Customer loyalty isn't created—it's earned. Here's how.
This post was last updated on December 6, 2022.
As a small business in an ocean of competitors, the struggle to distinguish your business is very real.
And while earning new shoppers is half the battle, it’s not easy to suss out the reasons why existing customers abandon ship, either. This is even trickier to do online, where you lack the ability to engage with your customers face to face.
But there are steps you can take to better understand customer sentiment, and to foster brand loyalty. Among them: create a sense of belonging, provide an outstanding customer experience, and earn your customers’ trust before they jump ship for a competitor.
A simple principle to remember is that happy customers make the most loyal ones. Use the methods outlined below to get your brand on the right track and to strengthen your eCommerce marketing plan.
How to measure customer loyalty
In order to improve customer loyalty, you need to know where loyalty stands today. Establish a baseline using the metrics below. These metrics can help you to spot potential issues and take corrective action before they become a bigger problem.
Customer satisfaction score (CSAT)
CSAT reflects how happy a customer is with your overall company or a specific action. It begins with one simple question: “How satisfied are you with [your purchase, your experience, our brand, etc.]?”
Have your customers rate their satisfaction on a scale of one to 10 or one to five, where the last two represent the most positive answers (e.g., nine is “satisfied” while 10 is “very satisfied”). Divide the total number of positive answers by the total responses you receive, then multiply this by a 100 to get your CES percentage.
CSAT is one way to quickly spot dissatisfied customers and to give your team an opportunity to turn a bad experience into a good one.
Customer loyalty index (CLI)
CLI factors in NPS, upselling, and more by asking three short questions:
How likely are you to recommend our company to others?
How likely are you to buy from us again in the future?
How likely are you to try our other products or services?
Using a scale of one to six (with one being 100% or “very likely,” and six being 0% or “not likely”), take the average score of the three questions to determine your CLI. While measuring actual customer behaviors provides more reliable metrics, CLI still provides a comprehensive, high-level gauge of your brand’s customer loyalty level.
Customer effort score (CES)
CES is a popular metric among customer support teams, used to measure how easy it is for customers to find answers to their questions or resolve an issue.
Similar to CSAT, a CES survey may include a question like “On a scale from one to five—one being ‘extremely easy’ and five being ‘extremely difficult’— how easy was it to find a resolution to your issue?” Or, “On a scale from one to seven—one being ‘strongly disagree’ and seven being ‘strongly agree’—rate this statement: [MyBrand] made it easy for me to handle my issue.”
CES surveys are usually sent right after a customer interaction (e.g., a purchase or support chat) takes place. The higher the score, the better. A low CES means that your user experience or customer support could use some improvement. Otherwise, you risk losing more customers.
Net promoter score (NPS)
NPS asks the question: “On a scale from 0 to 10, how likely are you to recommend our [store/product/service] to a [friend/colleague/others]?”
You can categorize answers into the following groups:
Promoter - gives a score of nine or 10
Passive - gives a score of seven or eight
Detractor - gives a score of zero to six
Then, calculate your NPS score by subtracting the percentage of customers who are detractors from the percentage of customers who are promoters.
In general, passive customers are satisfied with their purchase(s) but not emotionally tied to your brand or enthusiastic enough about it to recommend it to others. They are likely to shop with competitors for the same or similar products.
Detractors, on the other hand, are likely dissatisfied and more inclined to share about a negative experience with others. It’s a good idea to follow up with detractors to understand why they’re dissatisfied and attempt to remedy the situation.
(True story: sometimes the way you word your question can also have a dramatic effect on results. I once encountered a person who punched in as a detractor, only because he didn’t have friends in the industry to realistically recommend the product to.) When analyzed alongside customer data and demographics, an NPS score can help you identify your ideal customer or gauge product-market fit in addition to customer satisfaction.
Repeat purchase ratio (RPR)
While NPS is helpful, it’s important to recognize that NPS zeroes in on a customer's intent, not the actions they actually take. RPR helps to fill that gap by measuring the number of repeat purchases that actually take place. To calculate RPR, select a timeframe to analyze (e.g., one month, quarter, or year) and take the total number of repeat buyers divided by the total number of one-time buyers in that period. Use customer data and demographic information to help assess your RPR for strategy adjustments.
Customer lifetime value (CLV)
CLV allows you to determine or predict the total revenue attributed to a customer, and to identify your most valuable customer segments. First, multiply your customer's average purchase value (APV) by their average purchase frequency (APF). Then, multiply that number by the average customer lifespan to calculate your CLV.
How to build a customer loyalty program
When it comes to improving loyalty, there are various steps worth taking. One tried-and-true method is by creating a loyalty program that incentivizes buyers to come back.
Of course, some programs are much more successful than others. The best ones are well-researched, customer-centric, and regularly improved. Take these steps to create your own loyalty program:
01. Do your research
Take the time to figure out what your customers actually want out of a loyalty program and what it’s worth to them. Learn what motivates them to make a purchase and what products or programs they already favor.
Customer data is key to developing a strong loyalty program. Refer to your buyer personas, Wix Analytics, and any other data at your fingertips to drill into your customers’ needs, values, and desires.
02. Develop your strategy
Once you’ve done thorough research into your target audience, select a loyalty program model that best aligns with your business goals.
There are a variety of loyalty program models that you could incorporate into your eCommerce store. Here are the most common types:
Point-based programs - As one of the most widely-used loyalty program types, point-based programs allow customers to earn points based on completed actions (such as purchases, subscriptions, reviews, referrals, and more). These points can then be redeemed as discounts, coupons, or freebies. Set up a point-based system with Wix’s Loyalty Program tool.
Spend-based programs - Customers earn credits based on how much they spend. A well-known example is Kohl’s Cash. For every $50 spent, customers earn $10 in Kohl’s cash, which is redeemable on a future purchase within a specified timeframe.
Paid member programs - Customers pay an annual or monthly membership fee for access to exclusive perks, services, or discounts (Think: Amazon Prime).
Shared value programs - Your customers’ actions impact a shared value or goal. For example, you might donate a portion of each transaction to an organization or cause. Another method that’s becoming increasingly popular is to give customers the option to “round up” or to select/enter an additional monetary amount to donate during the checkout process.
Tiered programs - The more a customer spends, the greater the benefits or discounts that he or she receives. Each membership tier includes exclusive perks (think: Sephora’s Beauty Insider program, which includes tiers for Insider, VIB, and Rouge).
Gamification programs - Customers earn credits or points for purchasing specific products or taking certain actions. For example, each month, you could release a list of products and/or actions for customers to take, each with its own point value or other benefit (e.g., entries into a contest or raffle).
Partner (coalition) programs - Customers complete actions to earn credits redeemable towards a purchase at another partner store or site. For example, as a home decor company, you might partner with an interior design agency and offer discounts toward their services after spending a certain amount with your brand.
Pro tip: choose rewards that are generous and attainable
A generous and straightforward loyalty program can set your business apart from your competition. However, a reward program skewed too greatly in your business’s favor may be perceived as a gimmick to get customers to spend more. Your buyers likely won’t bother with incentives if they don’t feel they have a reasonable chance of benefiting from them or if the reward isn’t worth the effort. For example, if you give customers a $10 coupon for every $500 they spend, but your average item price is between $30 to $50, the reward may not be worth the investment for the customer. However, an award of $5 for every $100 spent feels more generous and attainable—and therefore is more likely to incite action.
The same goes for point-based programs. If the points expire too quickly, the reward loses its power to elicit a response. Avoid playing keep-away games with your reward system. Instead, develop a loyalty program that’s fun, generous, and adds value.
03. Build your program
Check with your eCommerce platform to see what loyalty program tools are supported. For example, Wix integrates seamlessly with apps like Smile, plus offers its built-in Wix Loyalty Program, making it easy to launch and manage your own program.
You can create a Member’s Area on your eCommerce site, letting customers log into their accounts directly from your store and access exclusive content or promotions.
For example, Jule Dancewear includes a Member’s Area that’s accessible from its homepage. A homepage popup, powered by Smile, further draws attention to its rewards program, breaking down all the ways a new member can earn points and redeem them. Jule Dancewear customers have the chance to earn points by following the brand on Instagram (among other things), which can translate to a coupon or discount off their next order.
04. Invite your customers
Now, it’s time to invite your customers to participate in your program and reap the benefits. Ensure that users know about your program by leveraging email, live chat, and other channels at your disposal.
Reduce barriers to entry by directing users to a signup or account creation page, plus providing a list of FAQs. Make sure to provide a way for them to follow up with any questions or feedback, too.
Once customers are signed up, consider greeting them with a friendly video that walks them through your member's area or the benefits of your program.
05. Measure your progress
A word to the wise: keep close watch over the performance of your program. Track important metrics like signup rate, average spend per member, and engagement—as well as the metrics mentioned earlier.
Compare the behaviors of those enrolled in your program against those who aren’t. Consider:
Are you seeing a noticeable improvement in customer satisfaction?
Do certain rewards or products resonate more with one group over the other?
What are some things that you should consider carrying over from your loyalty program to your general site or audience?
Take care to proactively identify and address any issues, plus find ways for you and your customers to get even more out of your program.
7 other clever strategies for building customer loyalty
It goes without saying that there’s a lot more you can (and should do) to raise your customer retention rate. Here are a few ideas to get you started.
01. Engage your customers
Don’t let your customers be strangers. A surefire way to help your shoppers feel like they truly belong with your brand is to regularly bring them into the conversation. As a few ideas:
Incorporate live chat. A live chat feature like Wix Chat can open up an avenue for engaging customers as they’re actively searching your site. Answer questions, recommend products, and personally greet customers on the spot—as you would in a brick-and-mortar setting.
Get social. Leverage social channels like Facebook, Instagram, and TikTok to engage new and existing customers. Respond to any questions or feedback. Develop unique campaigns (check out these holiday Instagram post ideas). Share your company values and expertise (LinkedIn, for instance, is a great forum for promoting activism). Whatever you do—get creative, and don’t simply focus on selling. Jumping into the conversation shows potential customers that you’re accessible and relatable, two praiseworthy qualities that will help etch your brand into their mind for future purchases.
Ask for feedback. Collect customer reviews, in addition to feedback on what customers would like to see out of your brand. Be it new products, better rewards, or faster shipping times—let your customer express their desires directly with your company. And remember to keep the dialogue going, providing relevant updates and showing that you care.
02. Personalize your offers, without being creepy
No two customers are alike. Hence why personalization is so widely championed.
“Consumers like personalization. They want brands to talk to them—but only if they’ve explicitly given them permission to do so,” says Tracey Wallace, director of content strategy at Klaviyo. “Brands need to collect [customer-first data], store it, and make it actionable. Keep in mind that customers are not only giving you permission to use it, but they expect you to use it. Neglecting to use their data for personalization is often viewed as a bad customer experience.”
Keep reading: How to 90x your email ROI: a Q&A with Klaviyo
To that end, there are many personalization examples and techniques worth testing. One idea: If a customer bought a pair of earrings, you could recommend a matching top or necklace from your catalog. The goal is to support and delight your customers with offers that complement their buying behaviors, versus sending a standard email to all customers with a one-size-fits-all offer.
03. Give all customers an equal opportunity
It may be tempting to reserve your best deals and promotions for new or at-risk customers. But doing so can leave your most valuable and loyal customers feeling alienated. Or worse, they might start jumping ship in search of a better deal elsewhere.
Instead, regularly reward all customers for positive behaviors (i.e., after a completed purchase, review, or referral). If a customer is at risk of churning, remind them of the uniqueness of your brand and gently guide them towards a positive behavior. Avoid simply relying on steep discounts or money-grabbing schemes to win their business, only to set the wrong expectations or cheapen your brand.
04. Create a consistent omnichannel experience
Your branding, service, and offers should be consistent across any and every channel you engage your customers on. Consistent branding doesn’t just cultivate trust; a strong omnichannel retail strategy also makes it convenient for your customers to shop your products however they’d like.
The same logic applies to your loyalty programs. For example, let’s say you run a point-based program. A purchase completed via a social app should generate points in the same way it would if the buyer were to complete the purchase directly on your website.
Their points should then be redeemable, whether they choose to shop in stores or online.
05. Accept pre-orders
Customers are bound to be disappointed if they come across a cool product on your site, only to discover that it’s out of stock. Prevent churning from situations like this by accepting pre-orders on your site.
All Wix merchants can easily take advantage of this using Wix’s native pre-order solution. Simply toggle the pre-order setting “on” for any product listing. Then, use Wix’s email marketing tools to keep customers up to date on the status of their products.
06. Build a real community
It’s hard to overstate the importance of community. For brands, there’s a clear opportunity to foster community among like-minded customers, though it requires time and commitment.
Community is the fabric of A Tribe Called Queer’s business. Through its online store, Instagram account, podcasts, community programs, and other events, the brand is able to reach LGBTQ+ individuals and businesses everywhere.
“Every aspect of my intersecting identity is deeply embedded in the foundation of A Tribe Called Queer, and also in everything we do,” says founder Sabine Maxine Lopez. “As a black, non-binary, queer person, it's imperative that I do my best to represent and serve my community in the best way possible.”
Their products are a symbol of the community they represent. All of A Tribe Called Queer’s clothing and accessories are gender neutral, plus size inclusive.
Read more: 5 LGBTQ+ entrepreneurs promoting inclusivity all year round
As you look to build a community around your brand, think first about your team’s purpose, vision, and values. Pick a cause you wholeheartedly believe in.
Leverage a blog, social media, an About Us page, or even a forum on your Wix store to spread your message and invite engagement.
07. Provide exceptional customer service
Last but certainly not least, create a brand that lives up to its promises and stays abreast of customer needs. Keep in mind that the way customers interact with brands never ceases to evolve, so you’ll want to make sure that the shopping experience and the support you provide are up to par.
Bridge the gap between online-only and face-to-face interactions by employing conversational commerce strategies. Use technology live chat, text, automation, and more to provide real-time support as shoppers navigate the eCommerce customer journey.
Regularly audit and optimize essential operations, such as the fulfillment process, manufacturing process, and more to deliver on your everyday promises (e.g., fast shipping, great product quality, and sustainable eCommerce practices).
Putting it all together
Improving customer loyalty requires dedicated time and hard work, but the reward is well worth the effort. Use the strategies listed above to build a solid customer base that isn’t simply at your store out of convenience, but rather, because they trust and believe in your brand.
Are you ready to increase customer loyalty and build your business? Test drive Wix's website builder for eCommerce.
Head of Product, Wix for eCommerce
Tamar has spent over a decade in product leadership with dynamic B2C companies, and is an established innovator in the field of eCommerce. As the head of product for Wix eCommerce, Tamar builds the tools that enable over 700k online stores worldwide.
Editor, Wix for eCommerce
Allison is the editor for the Wix eCommerce blog, with several years of experience reporting on eCommerce news, strategies, and founder stories.