6 Ways to Measure Your Customer Loyalty

customer loyalty

marketing plan templateDo you know if your customers are loyal to your brand or business? Use these techniques to monitor how likely your customers are to return.

When you open a business, it’s crucial that you put your customers at the heart of your brand. It’s their loyalty that is going to help you make sales, and so you need to have the correct processes in place to measure their . Here are six ways you can get started with measuring your business’ customer loyalty.



1. The Customer Retention Rate (CRR) 

CRR is a rate that focuses on whether or not you are actually keeping all of your new customers. It mainly focuses on this equation:

(X (The customers you have right now) – Y (The number of new customers you have had in the last 6 months)) ÷ Z (The customers you had around 6 months prior) = Customer Retention Rate

This is going to help you figure out whether or not you are retaining the loyalty of your customers.

2. The Net Promoter Score

Another simple technique that you can look into to gauge your customers’ loyalty is the net promoter score. The question this score answers is “how likely are you to use our service again?” Usually, it is also accompanied by a score of 1-10. When they pick a rank, this defines them as:

  • 9-10: Promoters
  • 7-8: Passives
  • 1-6: Detractors

Keep an eye on these scores as they can help you figure out how you can improve your brand and appeal to more people.

3. Loyalty Customer Rate (LCR)

Similar to our first metric, the loyalty customer rate focuses on how many of your customers have made more than four purchases from you. Use the equation x (the number of customers who have bought over four times from you during 12 months) ÷ z (the number of customers you had during 12 months) to find out what your precise figures are.

4. Loyalty Schemes

If math is not your strong suit, don’t worry, there are simpler ways for you to figure out how your business is doing from your customers’ perspective. You can offer a survey or a loyalty card. The best grocery loyalty programs will offer discounts, free products and point tallying to bring in new customers. So, keep an eye on those statistics.

5. Repurchase Ratio

Ultimately, this measures how likely your customers are to rebuy a product from your store. Divide the number of customers that continue their subscriptions by those who cancel and you will have your answer.

6. Customer Loyalty Index (CLI)

CLI is a standardisation tool to track customer loyalty through a “yes”, “no” and “maybe” questionnaire. These questionnaires usually ask if you would use the service again, recommend it to a friend or try out a different product. Similar to the Net Promoter Score, you will find that this index is calculated on the responses. Once you add the numbers together, you will be able to discern their behaviour.

Are you measuring your customer loyalty correctly?

There are many ways that you can measure the customer loyalty of your brand. But don’t worry if you find it a bit too complicated. Just keep an eye on how many people are currently buying from you – this will help you increase your sales. With all this in mind, you have the information you need to begin measuring consumer loyalty, allowing you to build and sustain it for many years to come.



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Editorial Staff

This article was written by SBMarketingTools.com editorial staff.