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Measuring Your Customers Loyalty

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Understanding and knowing your loyal customers is vital to your business. As a small business owner, you want to create consistent, positive experiences for your customers that result in repeat business. In fact, developing a strong base of loyal customers can make or break or company.


Customer loyalty is important

Loyal customers frequently spend money with your business and on loyal customers spend more during each trip. See these interesting facts about loyal customers:

  • The cost to bring a new customer up to the buying level of a loyal customer is up to 16x more, according to MarTech.
  • The probability of selling to a loyal customer is 60-70 percent, while the likelihood of selling to a new customer is 5-20 percent, according to Invesp.
  • A 5 percent increase in customer retention can boost profits by 25-95 percent, according to research from Harvard Business School.



3 statistics that help you gauge customer loyalty

There are many valuable statistics that can help brands measure customer loyalty, here’s a look at three to start:


Retention rate
This metric tells you the percentage of customers that you keep over a certain period of time. When measuring customer loyalty, your retention rate is crucial as it shows the percentage of customers that come back and shop again and again.

Customer lifetime value
How much profit do you stand to make from each customer over their buying lifetime with your company? That number is called customer lifetime value, or CLV. It’s a challenging number for brands to figure out, but it’s an important one if you’re measuring customer loyalty.

Net promoter score

A net promoter score tells you how likely a customer is to refer you to a friend. It’s a good barometer of customer satisfaction and loyalty. It’s typically a one or two question survey that is easy and fast for them to answer.

What is the best way to get the net promoter score? The easiest way is to send customers a survey. If you have customer email addresses, try creating a survey and the Oodles team can also help you.  If you have customer phone numbers, consider texting a survey with a tool with text features or also Oodles can help you with all of this.


Loyalty Facts

What impacts customer loyalty? Eighty-six percent of customers say likability is the primary driving factor, followed by trust.

To be likable, a brand must show its human side. Consumers don’t want to buy from faceless corporations; they want to buy from brands they can relate to. If you’re transparent about your mission and goals, make your customer service amazing, fix problems quickly, and reward customers who shop at your store, you’re already forming relationships with your customers based on trust. And that will keep your customers coming back to you instead of trying out your competitors.

Many businesses believe price drives customer loyalty. While it is an important factor, research shows 7 out of 10 customers are willing to spend more with companies that offer better service. Price isn’t everything; a great customer experience is often much more compelling.

How loyalty programs help measure loyal customers

83%  of loyalty program members say that rewards make them more likely to do business with a certain brand.

By setting up a tech-savvy loyalty program, you can not only retain customers through reward but also collect data to help you measure customer loyalty.


A loyalty program should give you:

  • Access to customer behavior data
  • Ability to segment customers
  • Ability to create and send promotions
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