How to Grow Your Base of Loyal Customers

How to Grow Your Base of Loyal Customers
Your loyal customers will purchase more with you, and more often. And they can be an incredibly valuable marketing tool.
by Square Jan 17, 2020 — 5 min read
How to Grow Your Base of Loyal Customers

Racking up sales is wonderful, but it won’t keep the doors open if these are just one-time customers. You need to retain your existing customers and turn them into diehard brand loyalists.

Your loyal customers will purchase more with you, and more often. And they can be an incredibly valuable marketing tool that can help you grow your customer base through referrals and word-of-mouth.

If you don’t already have one, now is the time to put a plan in place to harness the power of your existing customers. Here are the steps you can take to engage them and build a loyal following for your business.

Understand Your Customers

Because you need your customers to relate to your brand, you have to understand what they’re all about. You accomplish this through market research.

Market research is gathering information about the market you want to enter or operate in — your target market. The end goal is to find out how successful your offering can be to customers in your target market, and to understand how best to engage those customers.

There are two approaches to gathering this information: primary (research you do yourself) and secondary research (public-facing research compiled by a third party).

Examples of primary research include:


For instance, with email surveys, you could ask your customers directly what new services or offerings they would be most excited about. This helps you prioritize opportunities to grow your business, and shows your customers that you care about their feedback.

Examples of secondary research, which can also help you analyze your competitors, include:


By searching Google for keywords that you know your customers are already using to find businesses like yours on the web, you can see who your competitors are, understand how they are messaging to their customers, and gain ideas on how to refine this for your purposes.

Using your point-of-sale as a research tool

Your point-of-sale is a powerful research tool because it automatically tracks sales across every location (as well as online) and it ties those sales to customers so you can better understand their purchase behavior, it is a great source of data to easily identify opportunities for growth.

Your point-of-sale gives you access to internal data that you’ve accumulated from each customer interaction, such as:


By analyzing that data, you can spot customer trends, as well as opportunities to grow your business. For example, if you notice that specific customers regularly spend more than others, you can make it a point to alert them each time you have a new promotion.

By learning your customers’ unique behaviors, you’ll be better able to market to them.

Don’t Just Market to Your Customers; Reward Them

One of the reasons you market to your customers is to grow your sales. But that doesn’t mean that it’s all about you. Think about marketing as an opportunity to create a win-win situation for your business and your customers.

While each of your marketing campaigns should be designed around solving a specific business problem you have, you can also use your marketing as a way to provide value to your customers. These are called customer engagement campaigns.

Suppose you’re checking your point-of-sale data on a regular basis, and you keep noticing that:


Let’s look at how you can solve each problem with different types of customer engagement campaigns.

If your problem is growing your base

You can use your existing customers to grow your base of new customers through a referral program.

Set up email campaigns to your existing customers to promote the program in which your existing customer gets a free gift or a free month’s subscription in exchange for successfully sending a friend to your website to sign up or buy something.

If your problem is growing your sales per customer

If you’re aiming to increase the number of sales per customer, you could start a volume-based discount program to incentivize them. Here, your customers would get a discount if they buy your product in bigger quantities.

Similarly, you could easily create an email campaign announcing this program and then even automate it to send reminders out to your customer base at regular intervals.

If your problem is retaining your customers

If your issue is customer retention, then you have to build loyalty in them to keep them coming back. Customer loyalty programs are ideal at achieving this, with research indicating a 40 percent increase in customer-visit frequency for sellers who use loyalty programs.

You might create a program where customers are rewarded with points each time they make a purchase. Over time, these points accumulate, with a specific number of points corresponding to a gift or one of your products that they can then redeem. The net effect of rewarding your customers like this is you motivate them to return to you.

You can design and manage an entire loyalty program right from your point-of-sale.

Maintain First-Rate Customer Service and Relationships

A separate Square study found that 63 precent of customers indicated that the No. 1 factor that keeps them loyal to a business is stellar customer service. And SCORE research shows that:


All the marketing in the world won’t help you if your customer service isn’t also top-notch.

You’ve already explored who your customers are as a group, but delivering great customer demands knowing who they are as individuals. By keeping track of them and getting to know their unique preferences, their purchasing behaviors, and their feedback about your business, you’re able to provide the best and most personalized customer service possible.

While manual, pen-and-paper lists may work when your business has fewer customers, your point-of-sale can help you keep track of all your customer relationships automatically no matter how large your customer base grows.

Automatically generate entries in your customer directory (right from your point-of-sale) to keep a running record of all your customers’ interactions with your business, like their past purchases, feedback, contact information, and specific preferences and behaviors. Equipped with this knowledge, you can provide customer service that is fully personalized to each and every customer.

For even more direct communication, there’s nothing like proactively asking for and addressing customer complaints and feedback—before they ever think about taking their issue to a public forum. By encouraging open channels of direct feedback in this way, you allow for private resolution of any problems, which keeps your customers happy and protects your reputation and bottom line.

Regularly Monitor Your Customer Sales Data

From time to time, the information you’re acting on can get stale and out of date. That’s why it’s crucial that you have the most up-to-date information for your customer engagement campaigns.

Let’s say that you want to set up a promotion to reward your most loyal customers. You can set up your point-of-sale to identify customers that visit your store 10 or more times a month, then you can create a marketing campaign that targets only those customers with a special promotion every month. The system will automatically keep this list of customers updated to ensure that only customers who still fit your criteria will keep receiving promotions.

By staying on top of this information, you can adjust your marketing campaigns to account for changes in customers’ spending habits, preferences, and behaviors. The result is happy customers, more consistently.

Besides reviewing your internal data from your point-of-sale, make it a habit to also regularly conduct the primary research we mentioned earlier on. Send your customers surveys and polls from time to time, asking them their opinions and feedback on your products or services, as well as how you can improve their experience.

In doing this, you’re not only providing great customer service, but you’re also engaging your customers, which is the hallmark of successfully growing your base of loyal customers.

The Bottom Line is brought to you by a global team of collaborators who believe that anyone should be able to participate and thrive in the economy.


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