Customer Loyalty


Loyal customers and productive, loyal employees drive a company’s financial success. This really isn’t brain surgery or rocket science. It just makes sense. But backing up common sense is a growing body of research that supports the correlation between employee loyalty, customer loyalty, and the future profits of the business.

Employee Loyalty

Loyal employees enjoy their jobs and stay. The longer an employee stays with a company, the better they become at their job, the better they understand their products, and the better they will be at satisfying customer needs. As they stay loyal, turnover is reduced. As employee turnover is reduced, costs decline.
The result: loyal employees, better served customers, lower costs.

Customer Loyalty

Over time, satisfied customers generally become loyal customers (see further discussion below). As they receive consistently satisfying experiences, their trust and confidence increase—they keep coming back and they tell their friends. Revenue per customer increases as they buy additional products and services. The costs to acquire a new customer declines.
The result: higher revenues, more referrals, lower costs.

Despite the continued research on customer loyalty, many companies don’t really understand the long-term value of a loyal customer or employee. They will spend vast sums of money on advertising and promotions trying to attract new customers, while at the same time they neglect or spend little resources on the existing customers who are currently giving them business. Similarly, they will expend enormous resources on the hidden costs of employee turnover while they skimp on employee tools, training, and feedback.

Continuous Measurement

The overriding consensus of all the research is that there is a direct link between creating loyal customers and employees and achieving superior profits. The research supports common sense.

This finding leads us to our next obvious conclusion, which is if you never measure what customers and employees think, you won’t know how satisfied, loyal, and committed they are. Without continuously gathering real-time feedback, you’ll never know how to fix your deficiencies or emphasize your strengths. Consider these research statistics:

  • It costs 5 to 10 times as much to acquire a new customer than to keep an existing one.
  • For every customer that complains, 20 to 30 will not complain, they just won’t come back.
  • Each dissatisfied customer will tell 8 to 10 other people about the experience. (Or, maybe a million using the web.)
  • A whopping 60–70% of customers say they took their business elsewhere because of poor service.

Measuring customer satisfaction (at the unit level) drives loyalty

Are customers satisfied? Are they loyal? You’ll never know unless you ask them. Because customer experience happens at the unit level, that is where you’ll need to measure it. Then, let customers become your teachers. Seek their feedback (good and bad) and incorporate it into continual improvements in your operations. InMoment will help you do this.

Measuring employee performance improves employee satisfaction and productivity

Good employees want to be held accountable. Allow your customers to comment on employee performance, and give them an objective measurement of their service delivery. Managers can then fine-tune training to the individual employee. Additionally, employee satisfaction surveys can monitor how employees feel about their work environment.

Feedback should be real-time (not stale reports, filtered by a third party)

Waiting for customer feedback collection and analysis means that service lapses are perpetuated. Data should be collected daily and available for improvement and training immediately.

Customers should be your best source of innovative ideas

Often, companies overlook their best source of innovative ideas. Inviting customers into your R&D process not only provides a great source of innovation, but it also solidifies their loyalty to help you succeed.

The Solution

Research has shown that customer and employee loyalty are leading predictors of future financial success.

With InMoment, you will have at your fingertips real-time, actionable customer and employee information. InMoment helps you understand and resolve problems before you lose customer loyalty and employee commitment. You’ll have a system to help you predict future unit-level financial performance as you monitor your employees’ commitment and your customers’ satisfaction and loyalty.