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What Does it Take to Make a Customer Loyal to a Brand? – ReadWrite

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What Does it Take to Make a Customer Loyal to a Brand? - ReadWrite


It’s hard to overstate the importance of customer loyalty to the long-term success of a given company. When customers are loyal, they resist the temptation of even the most aggressive competitors and continue to generate revenue for your brand.

What Does it Take to Make a Customer Loyal to a Brand?

But what exactly is it that makes a customer loyal? Can you reliably increase the loyalty of your customers, even as a new business?

The Value of Customer Loyalty

Let’s start by explaining why customer loyalty is so important in the first place.

If a customer is loyal, they’ll be more likely to buy more products from you in the future or stay subscribed to your services. They’ll also be less likely to switch to a competitor. Overall, higher customer loyalty leads to a higher customer lifetime value, making every new customer you acquire more valuable to your brand.

But the benefits don’t end there. Loyal customers are also more forgiving of your mistakes and more willing to work with your customer service team to resolve issues. In addition, if they have a long history of positive experiences with your brand, they may even be willing to evangelize it – leading to an influx of new customers and greater revenue.

So what does it take to achieve these benefits?

Individual Differences

Before we dig into the key strategies and business elements that lead to higher customer loyalty, we should acknowledge that there are significant differences between individuals. What leads one person to commit firmly to a given brand could alienate another.

While the strategies I’m about to detail will work for many customers, they’re not foolproof – and you definitely need to take the time to research your audience and come up with tactics that work for them, specifically.

The Core Product/Service

The most important ingredient for higher customer loyalty is a core product or service that serves them well. If the product is good enough, there’s never going to be a reason for a customer to leave. Imagine the best restaurant in the world, with the best food you’ve ever tasted, a diverse menu with tons of options, low prices, and always a short wait time. Why would you eat anywhere else?

  • Solving a problem. Your core product needs to solve some kind of problem reliably. For example, you might help business leaders manage their marketing campaigns with an app or improve the fuel efficiency of motor vehicles – it doesn’t matter, as long as you do it well. If you make someone’s life easier or give them something they genuinely need, you’ll have a great start.
  • Value for cost. You also need to provide a good value for the price you’re charging. Your product might solve a problem exceedingly well, but if it’s too expensive or if a competitor offers something for a lower price, it might cause people to leave.
  • Convenience and accessibility. Don’t forget about convenience and accessibility. If your product is hard to get, hard to use, or otherwise inaccessible, it could be a major hiccup on the road to customer loyalty.

Competitive Differentiation

Unfortunately, even good companies can suffer from low levels of customer loyalty – if they face stiff competition. So if you have a lot of competitors or face competition in the future, it’s vital to find a way to differentiate your company.

  • Uniqueness. Overall, there should be something unique about your product or about your brand that sets it apart. For example, do you offer a higher quality than everyone else? Is there some feature that other companies can’t replicate?
  • Price and value. You can also be the top competitor just by offering a better value to price ratio. If you charge less money for the same product or offer better value for the same price, you’ll be in a great spot.
  • Branding and personality. Sometimes, you can close the competitive gap with the right branding and personality. A brand that’s specifically appealing to your target audience can make up for other flaws.
  • Other values. Of course, there are countless other ways you can differentiate your brand, from hiring the right people to expanding to a new market.

Customer Service

Sometimes, things go wrong. However, mistakes and accidents aren’t going to cost you customer loyalty as long as you know how to handle them properly.

  • Accessibility. Make it ridiculously easy to get customer service. For most brands, that means offering service across multiple channels and always responding to inquiries quickly.
  • Helpfulness. Don’t assume a simple apology is enough. You need to actually solve a problem (or make up for a mistake) when bad things happen.
  • Care. Passionate team members will make all your customer service experiences better in the eyes of your customers.

Staying Top of Mind

Happy, satisfied customers may drop your business to go with someone else. Why? Sometimes, it’s simply because you’re no longer top of mind.

You can increase your brand’s presence and memorability with strategies like these:

  • Logo and branding. Think carefully about your company’s logo and branding. A simple design with bold, instantly recognizable colors can make it easier to market your business – and potentially make your brand unforgettable.
  • Marketing and advertising. Your marketing and advertising strategies are also important. They’re not just a tool to attract new customers; they’re a way to remind existing customers that your brand is still around.
  • Email newsletters. Email newsletters and other regularly distributed forms of content will make it impossible to forget about your brand – and keep all your best customers “in the loop” about your latest offers.
  • Social media posts. Regular social media posts (and, of course, engagements with your fans and followers) are an easy way to keep your brand top of mind. It won’t cost you much time or money.
  • Engagement and outreach. Brand-consumer interactions define Brand-consumer relationships. Therefore, you need to reach out to your customers regularly on various channels to keep them interested.
  • New specials/deals. Occasional specials and deals can stoke interest in your brand – and revitalize enthusiasm from your oldest customers.

Incentives

It also helps to have some incentive programs to keep users around.

  • Subscription models. Startups these days sometimes build their entire model around a subscription to keep users paying a consistent amount. If you make it slightly difficult to cancel and give users rewards for staying subscribed longer, it will keep your customers around and paying.
  • Discounts and freebies. Why not give your best and longest-paying customers discounts and freebies? For example, you can gradually reduce the cost of a monthly subscription for customers who have subscribed for years or host periodic giveaways to reward your best customers.
  • Loyalty programs. Thinking even more simply, a basic loyalty program can go a long way to securing the ongoing patronage of your customers. People love racking up points – and they won’t be eager to divide their spending across multiple competing businesses when those points are at stake.

Consistency

No matter what, one of your highest priorities also needs to be consistency. If your product only works sometimes, or if your brand values undergo a massive shift after a year, you’re going to lose some followers.

That doesn’t mean your business can’t change (as we’ll see in the next point), but you should strive for early consistency when possible.

Evolution

Only the most traditional, conservative, diehard fans of your brand are going to stay loyal to you if you remain exactly the same. It’s true that some brands draw their power from tradition – take Coca-Cola as an example – but in the modern world, you’ll have much better luck with customer loyalty if you continue to evolve.

Pay attention to feedback and reviews, and keep rolling out new improvements and updates. It’s going to make your most loyal fans even more loyal – and possibly win over some would-be fans from the past.

Conclusion

Customer loyalty is a difficult equation to solve for some brands, but if you have a solid product at the center of your business, you’ll already be in a good spot.

Pay attention to your target audience, your top competitors, and the market landscape overall – and always be willing to adapt in the face of new information.

Image Credit: antonio prado; pexels; thank you!

Timothy Carter

Chief Revenue Officer

Timothy Carter is the Chief Revenue Officer of the Seattle digital marketing agency SEO.co, DEV.co & PPC.co. He has spent more than 20 years in the world of SEO and digital marketing leading, building and scaling sales operations, helping companies increase revenue efficiency and drive growth from websites and sales teams. When he’s not working, Tim enjoys playing a few rounds of disc golf, running, and spending time with his wife and family on the beach — preferably in Hawaii with a cup of Kona coffee. Follow him on Twitter @TimothyCarter

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Fintech Kennek raises $12.5M seed round to digitize lending

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Google eyed for $2 billion Anthropic deal after major Amazon play


London-based fintech startup Kennek has raised $12.5 million in seed funding to expand its lending operating system.

According to an Oct. 10 tech.eu report, the round was led by HV Capital and included participation from Dutch Founders Fund, AlbionVC, FFVC, Plug & Play Ventures, and Syndicate One. Kennek offers software-as-a-service tools to help non-bank lenders streamline their operations using open banking, open finance, and payments.

The platform aims to automate time-consuming manual tasks and consolidate fragmented data to simplify lending. Xavier De Pauw, founder of Kennek said:

“Until kennek, lenders had to devote countless hours to menial operational tasks and deal with jumbled and hard-coded data – which makes every other part of lending a headache. As former lenders ourselves, we lived and breathed these frustrations, and built kennek to make them a thing of the past.”

The company said the latest funding round was oversubscribed and closed quickly despite the challenging fundraising environment. The new capital will be used to expand Kennek’s engineering team and strengthen its market position in the UK while exploring expansion into other European markets. Barbod Namini, Partner at lead investor HV Capital, commented on the investment:

“Kennek has developed an ambitious and genuinely unique proposition which we think can be the foundation of the entire alternative lending space. […] It is a complicated market and a solution that brings together all information and stakeholders onto a single platform is highly compelling for both lenders & the ecosystem as a whole.”

The fintech lending space has grown rapidly in recent years, but many lenders still rely on legacy systems and manual processes that limit efficiency and scalability. Kennek aims to leverage open banking and data integration to provide lenders with a more streamlined, automated lending experience.

The seed funding will allow the London-based startup to continue developing its platform and expanding its team to meet demand from non-bank lenders looking to digitize operations. Kennek’s focus on the UK and Europe also comes amid rising adoption of open banking and open finance in the regions.

Featured Image Credit: Photo from Kennek.io; Thank you!

Radek Zielinski

Radek Zielinski is an experienced technology and financial journalist with a passion for cybersecurity and futurology.

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Politics

Fortune 500’s race for generative AI breakthroughs

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Deanna Ritchie


As excitement around generative AI grows, Fortune 500 companies, including Goldman Sachs, are carefully examining the possible applications of this technology. A recent survey of U.S. executives indicated that 60% believe generative AI will substantially impact their businesses in the long term. However, they anticipate a one to two-year timeframe before implementing their initial solutions. This optimism stems from the potential of generative AI to revolutionize various aspects of businesses, from enhancing customer experiences to optimizing internal processes. In the short term, companies will likely focus on pilot projects and experimentation, gradually integrating generative AI into their operations as they witness its positive influence on efficiency and profitability.

Goldman Sachs’ Cautious Approach to Implementing Generative AI

In a recent interview, Goldman Sachs CIO Marco Argenti revealed that the firm has not yet implemented any generative AI use cases. Instead, the company focuses on experimentation and setting high standards before adopting the technology. Argenti recognized the desire for outcomes in areas like developer and operational efficiency but emphasized ensuring precision before putting experimental AI use cases into production.

According to Argenti, striking the right balance between driving innovation and maintaining accuracy is crucial for successfully integrating generative AI within the firm. Goldman Sachs intends to continue exploring this emerging technology’s potential benefits and applications while diligently assessing risks to ensure it meets the company’s stringent quality standards.

One possible application for Goldman Sachs is in software development, where the company has observed a 20-40% productivity increase during its trials. The goal is for 1,000 developers to utilize generative AI tools by year’s end. However, Argenti emphasized that a well-defined expectation of return on investment is necessary before fully integrating generative AI into production.

To achieve this, the company plans to implement a systematic and strategic approach to adopting generative AI, ensuring that it complements and enhances the skills of its developers. Additionally, Goldman Sachs intends to evaluate the long-term impact of generative AI on their software development processes and the overall quality of the applications being developed.

Goldman Sachs’ approach to AI implementation goes beyond merely executing models. The firm has created a platform encompassing technical, legal, and compliance assessments to filter out improper content and keep track of all interactions. This comprehensive system ensures seamless integration of artificial intelligence in operations while adhering to regulatory standards and maintaining client confidentiality. Moreover, the platform continuously improves and adapts its algorithms, allowing Goldman Sachs to stay at the forefront of technology and offer its clients the most efficient and secure services.

Featured Image Credit: Photo by Google DeepMind; Pexels; Thank you!

Deanna Ritchie

Managing Editor at ReadWrite

Deanna is the Managing Editor at ReadWrite. Previously she worked as the Editor in Chief for Startup Grind and has over 20+ years of experience in content management and content development.

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Politics

UK seizes web3 opportunity simplifying crypto regulations

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Deanna Ritchie


As Web3 companies increasingly consider leaving the United States due to regulatory ambiguity, the United Kingdom must simplify its cryptocurrency regulations to attract these businesses. The conservative think tank Policy Exchange recently released a report detailing ten suggestions for improving Web3 regulation in the country. Among the recommendations are reducing liability for token holders in decentralized autonomous organizations (DAOs) and encouraging the Financial Conduct Authority (FCA) to adopt alternative Know Your Customer (KYC) methodologies, such as digital identities and blockchain analytics tools. These suggestions aim to position the UK as a hub for Web3 innovation and attract blockchain-based businesses looking for a more conducive regulatory environment.

Streamlining Cryptocurrency Regulations for Innovation

To make it easier for emerging Web3 companies to navigate existing legal frameworks and contribute to the UK’s digital economy growth, the government must streamline cryptocurrency regulations and adopt forward-looking approaches. By making the regulatory landscape clear and straightforward, the UK can create an environment that fosters innovation, growth, and competitiveness in the global fintech industry.

The Policy Exchange report also recommends not weakening self-hosted wallets or treating proof-of-stake (PoS) services as financial services. This approach aims to protect the fundamental principles of decentralization and user autonomy while strongly emphasizing security and regulatory compliance. By doing so, the UK can nurture an environment that encourages innovation and the continued growth of blockchain technology.

Despite recent strict measures by UK authorities, such as His Majesty’s Treasury and the FCA, toward the digital assets sector, the proposed changes in the Policy Exchange report strive to make the UK a more attractive location for Web3 enterprises. By adopting these suggestions, the UK can demonstrate its commitment to fostering innovation in the rapidly evolving blockchain and cryptocurrency industries while ensuring a robust and transparent regulatory environment.

The ongoing uncertainty surrounding cryptocurrency regulations in various countries has prompted Web3 companies to explore alternative jurisdictions with more precise legal frameworks. As the United States grapples with regulatory ambiguity, the United Kingdom can position itself as a hub for Web3 innovation by simplifying and streamlining its cryptocurrency regulations.

Featured Image Credit: Photo by Jonathan Borba; Pexels; Thank you!

Deanna Ritchie

Managing Editor at ReadWrite

Deanna is the Managing Editor at ReadWrite. Previously she worked as the Editor in Chief for Startup Grind and has over 20+ years of experience in content management and content development.

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