Cloud Sherpas reviews the three different types of customer loyalty (retention, advocacy and enrichment) and shares tips on how to measure each one for your business.

1. Tips to
measure
Customer Loyalty

2. Existing Customers Matter
It’s 7x more expensive to
acquire new customers
Sources: “Fastest Way to Lose Customers.” KISSmetrics blog.
Murphy, Emmet and Mark Murphy. Leading on the Edge of
Chaos: The 10 Critical Elements for Success in Volatile Times.
Did you know...
decreasing costs by 10%
A 2% increase in
customer retention
has the same effect as

3. Loyal Customers = Success
Retention
Enrichment
Advocacy
There are three ways to
categorize customer loyalty:
1.
2.
3.

4. What is Retention Loyalty?
A customer's willingness to
Without these satisfied
customers, there’s no base
of customers making
repeat purchases.
remain because they value
your product and/or service.

5. Measuring Retention Loyalty
Customer Surveys
Attrition Rate
Customer Sentiment
No single metric can measure
retention, but a combination of these
methods will help:
1.
2.
3.

6. What is Enrichment Loyalty?
Measure customer
satisfaction first, then take
Driving repeat or
additional purchases of
a product and/or service
advantage of upsell and
cross-sell opportunities.

7. Measure customer spend year-over year
Determine if spend per customer has
increased or decreased
The higher the increase, the greater your
enrichment loyalty
Measuring Enrichment Loyalty

8. What is Advocacy Loyalty?
Customers who refer your
business to others -- a
powerful tool!
On average, a business
Source: Keck, Chad. “What is a customer
recommendation worth?” Promoter.io. May 28, 2014.
generates roughly 60% of
its new customers from the
recommendations of the
existing customer base.

9. Measuring Advocacy Loyalty
Measure what customers say they
Net Promoter Score (NPS)
Social Media Activity
1.
2.
will do and what they actually do
to promote your business using:

10. Drive Long Term Success
Instill best practices that drive loyalty by
Measuring key indicators
Identifying loyal customers
Tracking improvements over time
1.
2.
3.

11. Want more on CX?
Download the Position Paper
The Power of Customer Experience:
Why Improving the Customer Experience is
So Valuable (And How to Do It)