Why is customer loyalty important?
Companies spend significant funds on retaining customers, combating outflows and maximizing profits from the client.
In recent years, companies have been spending their budget increasingly to measure customers’ loyalty and improve their satisfaction with the services received. According to the research by Gartner, half of all inward investment projects in 2017 focuses on customer experience. And this is not accidental.
The problem of quality customer service is complex. The market demands from companies to improve the service not to lose their target customers. It is proved that the increase in the share of loyal customers by only 5% increases a company’s profit by 50% or even more. Аccording to the estimations made by Bain&Company, attraction of a new customer is 4-10 times more expensive than retention of the regular one. A few practices of large corporations below confirm these facts.
The Apple retail stores managers get in touch with customers who put the lowest marks for service, within 24 hours after the NPS survey. The estimation of these customers’ expenditure on Apple products showed that on average each of them spent more than $1,000 over the following year, which is significantly more than dissatisfied customers not having been contacted spent. As a result, this strategy has provided the company with additional income of $25 million in the first year.
Finalta conducted a survey among clients of one large European bank. It showed that only 19% of clients that appealed to the bank support service and were dissatisfied with its work made a re-purchase. On the contrary, 75% of customers who faced the problem and was satisfied with the feedback returned to the bank again.
In its turn, the statistics of Phillips demonstrated that in the stores where NPS was increasing, the revenues grew up by 69%. Where it remained stable, the revenues increased by only six percent. And finally, in the stores where NPS had declined, the revenues fell by 24%.
Oracle and Dell surveys have proved that 86% of customers are ready to pay more for the same services if the level of service increases.
Along with this, 80% of all companies consider their services excellent. While in only 8% of cases, clients are satisfied with the quality of customer service. Therefore, if a proper system of quality customer service and customer satisfaction software is not developed, monitored and regularly assessed, the desired level of service will be impossible to achieve.
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