Why Is Customer Loyalty Vital To Your Business?

Have you ever wondered why some businesses may set up shop in areas that might not be very conducive to business and do quite well, while others are placed at major thoroughfares where walk by and drive by traffic are all but guaranteed, yet within six months they fold and the place goes up for lease or sale? The truth of the matter is that success is not always determined by your location - although it does play a vital role - but more often than not it is dictated by customer loyalty.

Here are four reasons customer loyalty is vital to your business.

1. First and foremost is the fact that a loyal customer is a repeat customer. This person will know about your business practices, about what to expect from your goods or service, the advantages and the disadvantages, and she or he will do business with you in such a way that it is a mutually satisfying transaction.

2. As you establish a relationship with your customer, you are also establishing a relationship with the customer´s family. Thus, it is not uncommon to have the wife bring in the dry cleaning for the family and turns her mother, mother in law, aunt, and best girlfriend on to your business. As the husband is sent one day to pick up the dry cleaning he becomes familiar with the business, and he will tell his brother, business associates, and others who are looking for a dry cleaner. Thus, you are suddenly becoming a commodity which is being shared with others.

3. While family referrals are great, business referrals are even better. If you are a dry cleaner, you will want the dress maker down the street to recommend your services to its customers. Similarly, if there is bridal shop with which you may have some professional ties, then these business referrals are simply priceless! Customer loyalties when you have other business owners or clerks shopping at your store or utilizing your service are quite often the gateway to a great number of new walk in customers.

4. Yet the fourth and perhaps most important reasons why customer loyalty is vital to your business is that most of the sales are not made the first time a customer is contacted.For example, when it comes to email marketing the customer needs to be contacted at least seven times, before action is taken on the offer. In an off line business, any bigger purchases, for instance a new car is seldom purchased at the first visit.

So, to have the best possible success with your business, online or off line, you need a loyal steady customer base.Typically 80% of the business comes from 20% of the customers.