customer loyalty

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The ability to retain customers and to keep them buying what is on offer over a longer period of time than competitors. Recent trends point to growing customer dissatisfaction and turnover. Loyal customers are increasingly hard to develop and keep. Aspects of building customer loyalty include delivering a quality product or service which meets the customer expectation, and ensuring that customers are valued and looked after effectively. As far as the benefits of customer loyalty are concerned, research has shown that it can be up to six times more expensive to acquire a new customer than it is to retain an existing one. Customer loyalty is extremely important and highly profitable to a company. A continuous dialogue with customers gives increased contact and knowledge of customer needs and this understanding of customer needs means fewer returns and complaints and costs. Happy customers generate positive word of mouth recommendation that improves a company's competitive position and lowers marketing costs. Finally, well-serviced and satisfied customers are always less sensitive to price, enabling greater profitability.

Subjects: Marketing.

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