In January 2022, Shopify had over 2 million online shops in the United States. A number that says a lot about competition and has one message to every Shopify merchant out there; You’re not alone!
However, if everyone is selling products online, what sets apart a successful Shopify store from a failed one? The answer can be summarized in what Jeffrey Gitomore, the famous American author, once said, “Customer satisfaction is worthless. Customer loyalty is priceless.”
Those who’ve heard of the Pareto 80/20 Principle know with their eyes closed that maintaining sales consistency depends on customer loyalty. With 80% of sales coming from 20% of customers, a loyal customer is the most valuable asset a Shopify merchant has.
Nurturing the relationship with customers, providing high-quality products and services, good communication, etc., are some tactics Shopify merchants follow to increase brand loyalty. This article will dive deep into the concept of brand loyalty, its value for Shopify businesses, and the most essential eight tips to boost it.
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What is brand loyalty?
Brand loyalty is a positive and devoted relationship between brands and customers. Loyal customers for one brand favor its products and services over competitors’ and tend to spread a good word of mouth about it. Brand loyalty can be measured by the repurchase and upsell ratios and customer lifetime and engagement indexes.
It is often confused with customer loyalty. However, the two concepts differ as brand loyalty is not related to the best offers and discounts; but to how consumers perceive the brand through previous experience, purchase, reputation, etc. In this context, we’ll demonstrate the three types of loyal customers to make things clear and later explain how to build brand loyalty:
Customers keep purchasing products simply because the prices and offers are better than competitors.
Customers like the ease of purchasing from a Shopify store, e.g., fast delivery. And, they don’t mind if they have to pay more sometimes for that ease.
Regardless of the price, offers, and ease, the customers will buy the products because they believe in the brand.
Why is brand loyalty important?
Brand Loyalty affects every single aspect of running a Shopify store. Having the best e-commerce store with top services and products is worth nothing without a base of loyal brand customers. They keep the business running and repeatedly purchase from the same Shopify store even with better competitor offers. Besides maintaining high revenue and helping in exposure, increase brand loyalty to gain its many advantages:
Retain customers and reduce customer acquisition costs
E-commerce businesses focus on acquiring new customers and spend more than 80% of their marketing budgets on new customer acquisitions. According to Forbes, it costs five times to acquire new customers than retaining existing ones, and the costly process has increased in value by about 50% in the last five years.
On the contrary, profits increase 25%-95% when customer retention increases by 5% and operational costs decrease 10% for a 2% increase in loyal customers. That being the case, when you increase brand loyalty, it significantly contributes to generating more e-commerce revenue and a higher net profit.
There is a 14 times higher chance of selling a product to a loyal customer than selling it to a new one. Existing customers are the real deal, and they’re the revenue generator as loyal customers tend to convert 9 times higher than new ones.
Increase brand loyalty, and customers will happily pay more for products with a higher average order value (AOV). A new customer who purchases for the first time has a 27% returning potential, but it escalates to 54% for those who purchase more than twice. Moreover, among loyal customers, the top 10% spend 3 times per order, and the top 1% usually spend 5 times per order.
Improve brand advocacy
Jeff Bezos, Amazon’s founder, and the e-commerce godfather, once said, “If you make customers unhappy in the physical world, they might each tell six friends. If you make customers unhappy on the internet, they can each tell 6000 friends.”
Besides being the most profitable for Shopify stores, loyal customers improve “word of mouth marketing” with positive reviews on different websites, comments on social media platforms, and online recommendations on forums. In other words, loyal brand customers are the real advocates every business needs.
Tips to boost brand loyalty for Shopify businesses
Unfortunately, magic tricks don’t apply to increase brand loyalty, and building it requires a well-developed strategy to be implemented over time. It’s an extensive, long-term, and effort-consuming process, and if you’re wondering how to build or improve brand loyalty, we’ll explain everything in detail.
Exceed customer expectations
If you’re wondering how to improve customer loyalty, you can start by going far beyond customers’ expectations because it pays off significantly. Who’s a better example to learn about building brand loyalty than the man behind Apple himself. Steve Jobs had a unique approach to building one of the most extensive bases of loyal brand customers, and his words are enough to define his method, “Our job is to figure out what they’re going to want before they do.”
Online e-commerce customers expect high-quality products and premium services. Therefore, offering that is not an advantage over competitors. Meanwhile, going beyond what they can expect will positively increase brand loyalty and impact their buying behavior. In other words, if you’re a Shopify merchant, never settle for the ordinary because millions of other merchants are doing the same.
Create a customer loyalty program
Loyalty programs are an impressive marketing approach to foster the relationship between customers and the brand. They were designed to recognize and reward customers in exchange for their particular activities. Shopify merchants should consider these programs to convert one-time buyers into loyal ones.
For example, reward recurring customers or the ones who leave positive reviews on social media platforms. You can also walk the extra mile and reward customers based on their purchase balances; the more they buy, the more they get, and their loyalty boosts. Utilize Shopify reports and third-party integrations to increase brand loyalty and monitor efficient customer loyalty programs.
Create unique offers to win the competition
Many Shopify merchants offer discounts to attract new customers. Although we can’t deny the importance of competitive prices, it’s not what every customer is looking for. Nowadays, online shoppers are interested in unique approaches more than before, and converting them requires thinking outside the box. Come up with a special plan and stand out from the crowd to win the competition and increase brand loyalty.
Have a Stress-Free Refund and Return Policy
Some customers find it tricky not to be able to examine products physically when shopping online. Despite providing thorough product descriptions and pictures, things could go wrong for some reason, and a customer might choose the wrong size or color.
Although having a return request is a total headache for every Shopify merchant, it’s best to be prepared for it by setting a precise yet simple return and refund policy. Flip the script and turn it into an opportunity to increase brand loyalty and convert a disgruntled consumer into a loyal one.
Provide Excellent Customer Service
Online shoppers will always have something to complain about. Whether it’s payment gateways, product fit, or shipping policies, there are tons of questions they would consistently ask. Not following up with them affects their buying decision and might negatively impact the online store’s reputation.
Tell a Great Brand Story
People buy stories, not products. In today’s competition, similar products are available via many Shopify websites, and sometimes, it’s provided by the same supplier. However, what sets e-commerce stores apart is the brand story behind each one of them.
In business, storytelling is a powerful method that must be used effectively. Stories evoke people’s emotional reactions; they interact and connect with them. After all, customers are humans, and they are motion-driven, so telling a brand story helps to increase brand loyalty and turns customers into brand advocates.
Engage Consumers Directly
Personalize the relationship with customers to build strong brand loyalty. Shopify stores have many third-party integrations you can utilize to engage with customers fruitfully. Connect chatbots to handle customer queries instantly and precisely, and reply to social media comments and reviews. Moreover, share the latest news and updates about your e-commerce store, and send direct email campaigns with promotions, product releases, and valuable tips.
Engaging with customers directly on a personal level isn’t just for closing deals; it’s about building a long life loyal customer and a brand ambassador.
Consistency transforms an average activity into operational excellence. Embrace your market position by following a consistent strategy to increase brand loyalty. Turning customers into brand loyal ones requires continuous effort to prove reliability. Customers will never engage with an e-commerce store unless they feel confident about its service level, which takes time and hard work.
Build Brand Loyalty for Your Shopify Store with Andava
Brand loyalty is a competitive advantage every Shopify store needs to ensure success, but not everyone has. Andava has extensive experience in every facet of Shopify e-commerce. We have worked closely with Shopify merchants from different industries and understand how building loyal brand customers dramatically impacts your ROI.