The Best Ways to Build Customer Loyalty Around Your Franchise

Taking steps to build customer loyalty is an essential process for most franchise businesses; it helps attract customers and encourages them to stay. Nurturing brand loyalty will not only allow you to save money on marketing and lead generation, but also attract additional customers through word-of-mouth referrals.

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Here’s a widely accepted fact: it costs significantly more money to acquire a new customer than retain an old one. In fact, findings by Invesp demonstrate just how lucrative customer retention can be:

• Acquiring a new customer costs five times as much as retaining an existing one

• The success rate of selling to an existing customer is between 60 and 70 percent; the success rate of selling to someone new is between five and 20 percent

• Increasing customer retention rates by just five percent boosts your profit by between 25 and 95 percent

Some business owners believe they should be acquiring new customers all the time if they’re to be successful. But, as you can see, retention is often more valuable than acquisition when it comes to making sales. Here are seven of the best tips for driving customer loyalty.

How to build customer loyalty

1. Choose a franchise with great values and then nurture them

Investing in a franchise with wide-reaching brand awareness can put you ahead of the game when it comes to developing customer loyalty. If the company already has a pool of followers around the country, or the world, you should have a long-term customer base from day one.

But starting to build customer loyalty is about more than just investing in a household name. The best franchises understand the importance of customer relationship management and exhibit principles people appreciate. According to a Harvard Business Review study, 64 percent of long-term business customers cited shared values as the main reason for their loyalty.

If you can demonstrate your brand’s values in everything you do, from operations and staff recruitment to marketing, you’ll be able to create a genuine connection with customers. And if you’ve already invested in a franchise, consider ways to make the business’s core mission shine through.

2. Focus on first-class customer service

Improving your customer experience is one of the most effective steps for increasing loyalty and advocacy - and not only because the individual will be tempted to visit again. If you make your customers happy, they’ll promote your business for you.

According to American Express, a happy customer will, on average, tell nine people about their positive experience with a business. But if someone receives poor customer service, they’ll tell 16 people about it.

Focus on customer experience in your employee training programmes, development schemes and your culture. And as consumer behaviour shifts and new trends come along, be sure to do your research and explore new ways to keep customers happy. By working out how to build relationships with customers with your specific operational model and industry, you’ll be able to generate results.

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3. Focus on employee satisfaction

Employee wellbeing is vital to the success of any business, whether staff members interact with customers or not. Of course, if your business does involve face-to-face contact with customers, workers are more likely to exhibit a friendly and amenable attitude towards others if they’re happy personally. Nurturing employee satisfaction should have a knock-on effect for customer satisfaction.

So, how can you build customer loyalty through employee satisfaction schemes? Well, 81 percent of employees say they’re driven to work harder when their boss appreciates their efforts (Glassdoor). Making sure you recognise the work your staff do could have a significant effect. You could show your appreciation by:

• Introducing an employee incentive programme to reward great customer service

• Investing in a personal development scheme so employees feel appreciated

• Organising relaxed work socials and fun events

• Introducing flexible working policies to help employees optimise their work/life balance

4. Organise customer-focused events

You may be interacting with customers on a daily basis, but arranging special events gives you an opportunity to establish a deeper connection with those who use your business. It shows you’re interested in more than just making money, and gives people a chance to mingle and try something new.

Why not organise an open day to showcase your services while offering free food and drink? Depending on the type of business you run, you could arrange workshops, taster days, in-store exhibitions or deals and discounts for your neighbours. You could even offer the use of your premises for a community event.

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5. Ask for feedback (and learn from it)

You can improve your ability to build customer loyalty by adapting your business in line with customer preferences. Find out what people value most about the company, and which aspects they think you could improve. Popular franchises act on feedback and are prepared to evolve to keep customers happy, which builds trust and, therefore, loyalty.

Although gathering feedback might seem like a lot of hassle, it doesn’t have to be. You could launch a survey on your website or social media profiles, or even via email. Or you could collect insights from reviews or social media engagement with customers. You could even just learn more about your customers by interacting at the till.

6. Prioritise consistent and personalised marketing

Firing off a load of emails to advertise your latest product drop and falling silent until you next have something to promote can reduce the level of trust among customers. Try to keep your marketing consistent and engage with your customers on a regular basis.

As well as highlighting new items, you could share news and shine a light on special staff members, for example. You can also build customer loyalty by tailoring communications to the individual. Try sending a birthday greeting or deals relevant to purchases they’ve made.

7. Develop a customer loyalty programme

One of the most obvious ways to build customer loyalty is to introduce a dedicated rewards programme. It doesn’t have to be complicated or particularly technical, as long as it helps customers feel appreciated. The key is to encourage people to value your business and buy from it again.

Research shows over half of customers would consider spending more money at a business with a loyalty programme - and 46 percent already do (ClickFox). So, get creative and think about what your customers would value; it could be discounts, freebies or a more personalised offer.

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