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What Is the Connection between CRM and Customer Loyalty?

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  • Written By: Valerie Goldberg
  • Edited By: Angela B.
  • Last Modified Date: 03 November 2016
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Customer relationship management (CRM), is a process businesses use to keep track of customer contact. CRM can include tasks such as making follow-up phone calls, sending promotional emails and inviting clients to webinars. Loyal customers are those who give the same place repeat business because they are satisfied with the products and how they are treated. There is a connection between CRM and customer loyalty, because having a superb CRM process can help a business have higher customer satisfaction.

Companies can measure how CRM and customer loyalty go hand in hand in their business by conducting what is known as an A/B test. A sales team divides a list of recent customers in half and one team waits a week to conduct a follow-up phone call with clients. The other team waits only a day to conduct a follow-up phone call with clients. A week later, both groups are sent a survey regarding their overall happiness with the company. It is likely that those who got a follow-up call sooner will give the company a higher rating and will be more likely to buy another product from the same company.

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Loyal customers like to be kept in touch with and offered special perks. Having a CRM system with tracking features can help a marketing and sales team see which customers have received what offers. CRM and customer loyalty specialists can use software to figure out what time of day specific customers tend to open their email and which campaigns consumers opened or deleted from their email boxes. Using these results, marketers can begin to send customers only the types of emails they like at the time of day they prefer, leading to a higher level of customer loyalty and satisfaction.

Keeping notes on a customer and remembering things about him or her is another way to keep a customer loyal. CRM and customer loyalty professionals can use a CRM platform to do just this. Every time a sales associate ends a call, he or she should make notes in the system regarding issues such as whether a customer wants to be called back in three months to discuss an upgrade or needs to reschedule an appointment because he or she is going on vacation. This way, when a reminder comes across a sales associate's desk to call a specific client back, the associate can reference what was discussed in the last conversation — something many customers will find thoughtful and impressive.

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suntan12
Post 4

@SauteePan - I know what you mean. My husband is a frequent business traveler and because of this he has access to an exclusive member lounge available at every airport. He always accumulates points for free personal airline travel along with free hotel stays because he chooses the same hotel chain and takes advantage of the points that he accumulates. This really helps because when we go on vacation we usually only have to pay for food and maybe the costs of the excursions.

I know that my husband will not use another airline or hotel chain because of the incredible benefits that he receives for maintaining his loyalty. They have also invited him to participate in a focus group to offer opinions on how to improve the customer service levels of the hotel chain.

They usually offer compensation as well as a complimentary stay in exchange for my husband’s opinion.

SauteePan
Post 3

@Sunny27 - I agree that that is a great way to increase customer loyalty. I also think that recognizing the top customers publicly is also a great idea. Credit card companies do this with the stated level of the credit card, whether it is gold or platinum.

They also do this by the color of the card. For example, the American Express Black card is offered my invitation only. People that fit this profile usually spend at least $250,000 a year. Customers of this card get complimentary airline tickets and free hotel stays along with a personal concierge service at their disposal. They also have extremely high spending limits and the mystique of this card has made it a

coveted card that everyone recognizes for its exclusivity.

Cruise ships do this also with many repeat customers. They usually have different colored keys and get special benefits like private dining with the captain and access to exclusive cocktail parties on the ship that no one else is invited to.

These perks are easy ways for customers to remain loyal and many companies will ask some of these customers for input in order to improve the service level of the company.

Sunny27
Post 2

@Icecream17 - I think that offering better value in terms of price helps a lot of customers, but these customers are not necessarily more loyal to the grocery store chain. They usually shop around and find the store with the cheapest offers.

I think to build customer loyalty you really have to develop superior customer service and even remember the little things about the customer that will make them feel special. For example, I never worry about shopping at a particular big box retailer because I know that I can always return the product if it does not suit me because their customer service is top notch.

I also think that offering special promotional gifts for a customer’s birthday

is really nice too. Every year I always receive a $20 gift certificate from a handbag store that I can use towards any purchase. I think that programs like this really improve customer loyalty because I am more likely to buy a handbag at this store than anywhere else.
icecream17
Post 1

I wanted to say that I think that many companies in efforts to improve customer loyalty offer a rewards program that benefits the customers every time they make purchases. I know that at my grocery store, I was asked to fill out demographic information about my family and then I was given a rewards card that allowed me to receive special pricing and promotional coupons whenever I shopped.

The company in turns tracks my purchases and even gives me some targeted Catalina coupons for things that I regularly purchase. This really must improve customer retention for the grocery store chain because I do feel more inclined to shop there because of all of the savings that I get.

It seems that every week I get a $5 off coupon on my next grocery store purchase of $60 or more. This is definitely smart because in order for me to use the coupon, I have to come back and I usually do.

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