8 Customer Loyalty Trends to Follow in 2020

Clint Fontanella
Clint Fontanella



Who is the perfect customer?


Well, if we look at the inbound flywheel below, it's someone who circles the wheel at the greatest velocity. These customers are constantly attracted to the company's offers, they actively engage with the business, and are consistently delighted by the outcome. They're even delighted enough to pursue new offers down the road because they trust that your product or service will play a role in their success.

nW30mysU4mEWRxcJc8R8mWAzpidhtPF71dMW7aUbJ_sau2BjTA-f-wC7RH95x985RC9-_Lm_sXhEVXA7Q25CoNcND2rLNsru4LecF21jVnIM6D3tnvJhcNLiWhYsW8qQON7uam04These customers are your loyal customers, and while they're a small group, they make a big impact on your business. Loyal shoppers spend more money on your products and are more likely to return for future purchases.

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While most companies understand this value of customer loyalty many have trouble finding and retaining loyal customers. Customer loyalty is an evolving field that has new trends arising each year which impacts customers' needs. If businesses expect to meet these needs, then it's important for them to monitor industry trends and statistics for changes that may influence customer loyalty.

If your company is looking to stay on top of the latest customer loyalty data, we put together a list of stats that you'll want to consider for 2019.

Here are some statistics on customer loyalty, as well as loyalty programs, that we have on our radar for 2019.

1. The top 10% of your customer base is spending 3x more than your average customer.

As we mentioned earlier, loyal customers will spend more money at your company than any other person walking into your stores. In fact, Adobe found that the top 10% of your customer base is spending three times more than your average customer — and your top 1% is spending up to five times more. This is why it's important for businesses to pursue customers who are more likely to become loyal, rather than just marketing to anyone.

Using tools like buyer personas and a CRM is one way for companies to highlight potential leads who are more likely to become loyal customers.  

2. 67% of customer churn is preventable if the issue is resolved during the first interaction.

If you're looking for a stat that proves the worth of your customer service team, this would be the one to mention in the next staff meeting: According to thinkJar Research, 67% of customer churn is preventable if the issue is resolved during the first interaction. This means that a good customer service team can be the difference between you losing and keeping a loyal customer.

It's important to invest in your customer service teams by providing them with the right tools that help handle customer interactions. Doing so can lead to an improvement in customer experience as well as customer loyalty.

3. Customers with an emotional connection to a brand have a customer lifetime value that's 4x higher than the average customer.

In a study of over 100k consumers, Motista found that customers who are emotionally connected with a brand have a lifetime value that's 306% higher than the average customer. Customer lifetime value is a key consumer metric because it tells companies how much revenue they can expect one customer to generate over the course of the business relationship. If your brand can create memorable and positive interactions, customers will be much more likely to buy from your company again, thus increasing lifetime value.

4. 47% of consumers won't engage with a business after a moment of brand disappointment.

Your business will make mistakes, and while it's important to learn from them you also need to keep in mind that these mishaps aren't inconsequential. Accenture has found that 47% of consumers stop doing business with a brand after the company disappoints them. Your business may not be perfect, and you will fall short at times, but it's important to remain dedicated to customers' needs — especially when you fail to fulfill them the first time around. If you don't, customers will likely look to your competitors who can meet their expectations.

One aspect of customer loyalty that has grown in popularity over the years is the use of loyalty programs. Customers can sign up for these loyalty programs to obtain continuous benefits from the company over time. As researches continue to look into the different elements of customer loyalty, many interesting statistics have surfaced regarding these memberships.

Loyalty Program Statistics

Loyalty programs are an effective way for businesses to optimize the value of their most loyal customers. If your company doesn't have a loyalty program or is looking to improve your existing one, take a look at these statistics which explain how using these programs can make your exclusive offers a bit more enticing.

1. 37% of customers will pay extra for an enhanced tier of membership.

Customers are always looking for more value from an offer, and many are willing to pay more to get it. In fact, Bond reports that 37% of customers are willing to pay more money to upgrade to an enhanced tier of a customer loyalty program. This presents an opportunity for brands to make more from customers who are looking to further engage with the company.

Instead of adding more options to one program and hiking up its price, brands can create different levels to their loyalty memberships that have varying benefits depending on what customers choose.

For example, you could create a program with a gold, silver, and bronze status. The bronze would have basic features, silver would have a little more, and gold would have the most. This way your business can continue to derive more revenue from customers who have already maxed out on their current loyalty plan.

2. 52% of loyal customers will join a loyalty program.

Don't have a loyalty program, yet? Well, it may be time to start drawing up plans for it because research shows that more than half of your loyal customers will join your loyalty program if you offer them one. Even if you just offer them discounts and sales, the reduced prices and increased customer satisfaction will only lead to more visits from these customers. Plus, they'll feel more incentivized to shop with your company because they're actively invested in your loyalty program. Loyal customers contribute some of the highest amounts of revenue to your business, so why not give them a chance to spend more.

3. 75% of consumers would engage more with loyalty programs that make rewards mobile-friendly.

Many companies will allow customers to claim loyalty rewards through their website. However, these rewards are often hard to redeem because the application they're displayed on isn't mobile-friendly. That means that when customers try to scan the discount in the store, the scanner can't read the code because it's skewed by the mobile screen. This can lead to customer frustration and negative customer experiences.

Businesses have been able to counteract this roadblock by offering their rewards through a mobile app. This is because 75% of consumers said they would engage more with loyalty programs that offer mobile-friendly rewards. Companies like Starbucks use their app to push out promos and discounts that loyal customers can download, and since the app is designed for mobile use, these discounts render properly on the mobile screen and are easily scanned.

4. 70% of consumers would be more likely to recommend a brand with a good loyalty program.

One intangible effect of loyalty programs is that it gives customers the feeling of being part of a community or group. This is because the people who belong to these programs have access to premium offers and information that other people don't. Luckily, customers aren't very humble and are likely to brag about their exclusive status to other customers who are shopping in the same marketplace. In fact, 70% of consumers are more likely to recommend a brand if it has a good loyalty program.

Think about brands like Amazon, who have created popular loyalty programs for their customers. Almost every Amazon Prime member loves to boast their free two-day shipping status whenever they place a new order. That excited feeling about getting a good deal is what makes customers share their experience with other consumers who are looking to achieve the same result.

Adopting a customer loyalty program is a great way for your business to identify and retain loyal customers and investing in it over time can lead to increased customer referrals, positive customer reviews, and improved customer satisfaction.

For information about building and managing customer loyalty, read about customer loyalty analytics.

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