Do you know your customer loyalty quotient?

By Alan Chung

CEO of Perka

Business owners love talking a good game about the value of customer loyalty – but how many actually walk the walk? It's beginner stuff to know your 80/20 Rule – that is, 80 percent of sales are generated by 20 percent of your customers.

Other studies reveal that customers buy 20 percent more product and also accelerate purchase frequency by 20 percent when motivated by a reward.

But loyalty talk is cheap. Putting stats into measurable actions that drive your business goals forward is another matter entirely. Test your Customer Loyalty Quotient with this quiz — and see for yourself how well your business translates customer loyalty theory into what proves to be a remarkably profitable practice.

Quiz yourself

Compare yourself with other owners or managers of businesses like yours. Are these statements ...

A. More true of your business than your competitors?

B. Just as true of your business as your competitors?

C. Less true of your business than your competitors?

___ We have many repeat customers who visit our shop regularly.

___ My staff and I can greet our most frequent customers on a first-name basis.

___ We're good at remembering a regular's usual order.

___ Satisfied customers promote our business by recommending us to friends.

___ We currently offer a customer loyalty program or use punch-cards.

___ We offer discounts and rewards based on a customer's particular buying habits.

___ Our business stays active on social media sites like Facebook and Twitter.

___ We run exclusive promotions reserved for our very best customers.

___ Our customer service improves the way customers view our business.

___ We track measurable data about the buying habits of our most loyal customers.

Score yourself

For every time you answered (A), give yourself 10 points; for each (B) response you earn 5 points; and (C) answers are worth zero points.

A score of 70 or higher means you're successfully harnessing customer loyalty marketing to meet your business goals.

Between 40 and 70 puts you on par with most businesses. You're eager to put loyalty marketing to work for your business, but you're uncertain about which loyalty strategies help you move the needle. This may be due to an unclear loyalty strategy, a lack of reliable program tracking, or both.

Below 40? Your most regular customers aren't feeling the love, and that's a bigger problem than you may realize. Implementing a solid customer loyalty strategy can build lasting relationships with these customers — and prevent your competitors from luring them away.

Chung is the CEO of Perka, a mobile loyalty platform that helps retail merchants and consumer brands reward their regular customers.

Read more about customer service/experience.

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