Customer Loyalty

Customer Loyalty is the ongoing positive relationship between a customer and a business.

It results from consistently positive emotional experiences, satisfaction, and the perceived value of an experience, including the product or services.

Loyal customers typically keep buying from the same brand, feel highly satisfied, and recommend the brand to others.1

Visual Representation

customer loyalty visual representation


The primary purpose of customer loyalty is to build strong, positive relationships with customers that drive business growth and profitability.

This relationship goes beyond single transactions and aims to create a loyal base of customers who consistently choose your brand over competitors.2


The importance of customer loyalty impacts almost every metric important to running a business.

If customers aren’t happy and continue buying from you, the business risks failing.

Acquiring new customers is typically more expensive, and they tend to spend less than loyal, repeat customers.

Loyal customers are more beneficial as they help the business grow and maintain high profits.3


Customer loyalty can be used in a variety of ways by businesses to achieve their goals.

Here are some typical applications:

  • Retail and E-commerce: Stores and online shops have loyalty programs that give customers points, discounts, or special offers to encourage them to keep shopping. For example, a customer might get a discount after spending a certain amount or get early access to new products.
  • Hospitality Industry: Hotels, airlines, and restaurants use loyalty programs to reward customers with points that can be exchanged for free nights, flights, or meals. This helps keep customers happy and coming back.
  • Service Providers: Companies like phone services, utilities, or subscription services offer perks like upgraded plans or better rates for loyal customers to keep them from switching to competitors.
  • Banking and Financial Services: Banks and financial institutions offer benefits like better interest rates or lower fees to customers who have been with them for a long time or who use multiple services.
  • Technology and Software: Tech companies provide loyalty benefits such as exclusive access to new updates or beta testing opportunities, which not only keep customers but also turn them into brand advocates.4


A coffee shop chain has created a customer loyalty program where customers earn a free coffee after every ten purchases.

Additionally, they keep customers engaged by sending out a monthly newsletter with coffee recipes and special deals and by organizing community events at their locations.

These strategies help keep customers returning and encourage them to promote the brand to others.

Related Terms


1. What is customer loyalty? definition & guide. Qualtrics. (2022, February 3).

2. AIContentfy Oy. (2024, January 23). The importance of building strong relationships with customers. AIContentfy.

3. The Importance Of Customer’s Loyalty. (n.d.). (n.p.): CIEL.

4. Pratminingsih, S. A., Lipuringtyas, C., & Rimenta, T. (2013). Factors influencing customer loyalty toward online shopping. International Journal of Trade, Economics and Finance4(3), 104-110.

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