Customer Loyalty – Its Significance and ways to Measure it

What is customer loyalty?

Customer loyalty is the readiness of a customer to do business with a company on a regular basis. This is usually owing to their positive and memorable experiences with that brand. Customer loyalty builds brand trust, improves share-of-wallet, and allows your company to expand without having to recruit new customers.

 Loyalty is defined as the degree to which customers like or trust a particular brand. It is reflected in the fact that the customers are ready to make repeated purchases in the future.

In the context of brand loyalty, loyalty can be viewed in a variety of ways. People are loyal to a brand because it provides them with a favourable experience, such as excellent customer service, a sense of connection to the brand’s principles, or quality of the products or services offered by the brand.

It’s not about a single product or service; loyalty develops over time as a result of a series of positive experiences that lead to a sense of trust. It also doesn’t imply that each interaction must be flawless.

Why is Customer Loyalty important?

 Client loyalty should be encouraged as loyal customers can help you develop your business more quickly than your sales and marketing teams.

If consumers keep coming back to you for business, then your products and services must be good enough for them to promote them to others. Customers that are loyal to a brand tell their friends and colleagues about it, which promotes referral traffic and word-of-mouth marketing.

Customer loyalty is beneficial to efficient planning. It allows organisations to better foresee growth, which aids in financial planning. Marketing teams can identify loyal clients who can be counted on, making it easier to make budget-based decisions in advance.

Customer loyalty also builds a strong bond of trust between your company and its customers. When clients choose to return to your firm on a regular basis, the value they receive from the connection outweighs the potential benefits they would receive from a competitor.

Customer loyalty is beneficial to efficient planning. Customer loyalty allows organisations to better foresee growth, which aids in financial planning. Marketing teams can identify loyal clients who can be counted on, making it easier to make budget-based decisions in advance. Customer loyalty is usually associated with high levels of customer satisfaction.

Measuring Customer Loyalty


Net promoter score, also known as NPS, is a sort of customer satisfaction metric that assesses client satisfaction and loyalty. Companies use this tool to find out how likely their customers are to refer them or their products to others. The question in most NPS surveys is structured as follows: ” How likely are you to recommend our brand to family or friends on a scale of 0 to 10?” This question can be phrased differently depending on the firm, but it will always inquire about the customers’ willingness to suggest the company or its products. NPS surveys can be easily launched using online survey tools

Customers who are most inclined to refer the firm or its products/services to others are known as promoters. Promoters aid in the enhancement of the company’s brand image and the acquisition of new customers.

Respondents who are passive are those who are uninterested in the company. They aren’t likely to say anything negative about the company, and they aren’t likely to say anything positive about it either. They may enjoy working for the company, but not enough to promote it to others. The most detrimental to a company’s reputation and brand image are detractors. These customers are dissatisfied with the company and its products, and they are unlikely to have anything nice to say.


Customer satisfaction score (CSAT) is a customer loyalty and satisfaction indicator that assesses how satisfied your customers are with a business action or specific products/services.

Customers are asked to rate a product or service on a five-point scale in CSAT surveys: 1 indicates that the customer is extremely disappointed with the product, whereas 5 indicates that they are extremely pleased.

Enterprise survey softwares having customer experience tools can be utilised to launch CSAT surveys.

Customer satisfaction scores are beneficial when they are collected following a customer-service encounter. When customers are able to acquire a resolution and no follow-up is initiated within 24-48 hours, this occurs for most customer service teams. These are important checkpoints, and the time frame can signify the amount of effort required by the customer. CSAT, on the other hand, may be utilised for a lot more than just customer service data.

It can be used as a touchpoint measure to collect feedback following specific customer interactions at any point along the customer journey. This assists in determining customer satisfaction at each stage of their journey and might indicate areas where the company may not be offering a positive customer experience.


Customer effort score (CES) is a metric that is commonly used to assess the impact of various aspects of your product or service on the customer experience. It allows you to see how much work a consumer has to put in to do a job using your product or service. In most CES survey questions, the responder is given a statement and asked to select their level of agreement with it.

CES Surveys can be launched online, offline or as telephonic surveys using CATI Software.

Why is it important to track customer effort scores? Consider the last time you had to call a company’s customer care department. Were their contact details readily available in their programme or on their packaging, or did they have to press 10 buttons and wait half an hour to reach their customer support staff through text or phone call?

The latter can be deemed bad customer service, and you would be quite justified in leaving a negative review and taking your business elsewhere.

Even if their customer service is able to rapidly remedy your issue, you may be tempted to transfer brands due to the inconvenience.