• Sunday, July 21, 2024
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Customer loyalty strategies for promoting informal sales revenue (I)

5 tips to boost sales without breaking the bank

Ensuring that customers come back to you a second time to demand what you are selling can be a big deal. If you think it is easy, try selling a homemade recipe to a next-door neighbour who is equally good at cooking.

You may soon find out that you will be your only customer!

Pushing products to final consumers and ensuring a lasting purchase relationship with them comes with a strategic process that goes well beyond branding and advertising normalities. If you asked top advertising firms how easy it is for them to secure brand loyalty from their numerous customer base, then, you may be close to understanding the challenges tied towards gluing products almost permanently to the hands of their teeming consumers whose options vary as wide as a spectrum of colours in a rainbow.

Some scientific research studies have shown that ensuring brand loyalty and gaining more customer sympathy towards products start right from the bargaining phase of product purchase. While this may depart from the traditional economic argument that recognises consumer utility maximisation from consumption as a function of an individual’s revelation of his preferences given his choices, later studies have extended this purview to capture customer-seller activities that occur before actual consumption of the product or service.

If organisations must secure their customers’ loyalty, they must be ready to promote strategies that must help them connect with their customers’ needs and wants. Organisations must also be prepared to deliver desired satisfaction more effectively and efficiently than their competitors within the same market space. If the appropriate strategies are well programmed then firms will tend to enjoy improved patronage from loyal customers who will keep coming back for more.

Read also: The X in the CXO: Three steps to attract the best customer experience officers to your firm

Ensuring that customers are given suitable attention, which promotes satisfaction, is crucial to making customers stick. With increased customer satisfaction comes enhanced loyalty, increased market share, improved performance and profitability, increased repeated sales, and increased in-person evangelism about the product.

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Indeed, when customers deem a service or product good enough to meet their immediate daily needs, such a product or service can satisfy the customer. Therefore, assessing the satisfying quality of a product or service can be done right from the purchase encounter of the customer. At purchase point, a customer’s bias towards his future commitment towards the product, service or seller commences, and his experience during that period is essential to gauge if he will consider a return purchase or not.

Observing activities in Nigeria’s large informal economy is one quick way to assess customers’ retorts towards purchasing or bargaining encounters vis-à-vis the tendency to attract their loyalty in the future. Undoubtedly, the informal sector prides itself as a chief absorber of labour; over 70 percent of employment opportunities in Sub-Saharan African (SSA) economies accrue to this sector alone. Also, the sector contributes close to 60 percent of overall economic activities in Sub Saharan Africa. The informal sector mainly houses activities of micro, small and medium scale enterprises.

In Nigeria, the informal sector also provides a significant economic boost towards daily living. Many formalised business activities also patronise some services of the informal economy to drive their daily activities. For instance, a finance firm’s IT department can hire the services of an unregistered, informal computer repair technician whose service cost is much cheaper than those of a more formalised computer repair firm.

Also, the informal sector in Nigeria is large enough to accommodate sufficient exemplary experiences since the sector is a significant employer of labour and the activities therein are diverse and commonplace.

Hence, it is imperative to examine some of the factors that characterise the purchasing or bargaining experience within an informal economy framework as carried out by a novel research team in Lagos, Nigeria, and how the experiences may enhance satisfaction and, thereafter, command loyalty among customers.

When a purchasing encounter ends with a good deal perceived by the customer, the customer has gained the upper hand in the bargaining process. The apparent gratification derived from the purchase activity culminates in the contentment of such customer. Such delight could lure the customer for a comeback, yielding increasing sales returns to the seller.

The scarcity of a product in circulation can be linked with limited knowledge about the product, thus, restricting the customer’s scope for bargaining. When a product is scarce, its price will be elevated beyond the norm and customers will be exposed to only slim chances at negotiation. This rather undesirable feature can lead to reduced satisfaction of customers.