Studies from Bain & Company show that customers who are promoters of your brand are 2-6x more valuable on average over the course of their customer lifetime, as compared to detractors.
A customer’s experience with your company influences their thoughts, feelings, and decisions about your company and your products. Those sentiments have big implications, so it’s vital that data about their customer experience factor into your business planning and approach.
For example, customer lifetime value (CLV) is a key metric to measure, and when used alongside customer experience (CX) tools like the Net Promoter System (NPS), companies can understand how and why customers interact with brands and, importantly, capture how they feel about doing so. Most importantly, they distill which customers are promoters and detractors.
Loyal promoters are more valuable customers because they:
Happier customers return for more and stick around. Whether it’s from exceeding customers’ expectations or an exceptional customer experience, they want to spend more time with your brand, learn more about your products, and be part of the culture of your company. This translates to more sales over time.
Loyal customers are more likely to purchase more of your product. This can mean increased sales and adoption of new products when they’re released.
Recommend to friends and colleagues
When you enrich the lives of your customers, they’re much more likely to share the great customer experience with their friends and family. Word-of-mouth and personal recommendations are unmatched in value - and that means lower costs to acquire new customers.
Cost Less to serve
Customers who have an outstanding customer experience throughout their customer journey are less likely to seek additional support or require costly incentives and promotions. In the end, that translates to lower costs to retain customers.
Provide ideas and feedback
Capturing meaningful responses, inputs, and ideas from loyal promoters can drive better products and services, and give customers a sense of ownership and being heard by your brand, which can lead to increased customer loyalty. Think about this: doesn’t it feel good to be listened to?
The bottom line
Loyal promoters provide so much value to companies and organizations beyond their point of sales transaction.
That’s why it is vital to have a successful customer experience management program within your company to better understand:
what creates loyal customers for your company,
how to maintain that base of loyal promoters and keep them happy, and
how to turn detractors into more valuable promoters over the long-term.