How the Law of Reciprocity Can Influence Customer Loyalty and Your Bottom Line
The law of reciprocity is something you may not have considered when it comes to your business. This law is one of those concepts we are aware of vaguely yet never put a name to, and therefore don’t maximize the effect they could potentially have on our business.
Reciprocal loyalty is a very effective way to gain customer loyalty, and it’s somewhat a simple concept. Giving your customers some sort of gift, a small token of appreciation, discount, etc. will cause them to feel the natural urge to repay that act to you, and the easiest way to do that is to stay a loyal customer. Honestly, the act of giving is what counts the most. Two-way loyalty is a great way to stand out among your competitors.
The reciprocity norm, and how reciprocity can influence customer loyalty is a fascinating venture into human psychology that can give us as business owners a “leg-up” when it comes to keeping customers. Let’s explore some ways you can encourage reciprocity in your customer-business relationship.
What is the reciprocity norm?
Reciprocity is a principle of influence. In total, there are 6 principles of influence: reciprocity, consistency, social proof, liking, authority, and scarcity.
You can see reciprocity in relationships all around us. Have you ever returned a favor to a friend or a family member, like helping with a move or cooking dinner? Feeling the need to repay a gift or a kind act is the reciprocity norm in action.
Reciprocity is a natural behavior. As humans, we automatically have an urge to favor the kind. Everyone appreciates when someone tries to repay the favor—and your customers are no different.
How can reciprocity influence customer loyalty?
Showing your customers that you appreciate them and rewarding their loyalty is a great way to create a reciprocal relationship.
There’s no surprise that customers are more likely to stay with companies that appreciate and reward them.
How can you create a reciprocal customer-business relationship?
Here are some effective ways you can return the favor to your customers and increase your customer loyalty as a result:
75% of consumers say they favor companies that offer rewards. Reward programs are one of the most common but powerful tools you can use to increase customer loyalty. Reward programs give customers valuable perks, like a point system that will give them credit to buy products with you. It can really make you stand out from the crowd and be a determinative factor for your customer when choosing a company.
Offering perks will automatically urge your customers to repay the favor by remaining loyal to your business. This is the law of reciprocity in action.
Reward your new customers with exclusive welcome benefits. One of the most common ways to do this is by offering welcome discounts to hook people in and encourage them to make their first purchase with you. Putting a time limit on this is another effective strategy to encourage them to snap up the offer quickly.
Reward your loyal customers with exclusive treats on their birthday. You can offer them a freebie to redeem with their next purchase or a discount to use on their favorite products.
Reward customer feedback
Feedback is essential to your business’ success. Offering a perk, like a discount, to your customers for giving you helpful feedback is another way to encourage them to repay the favor in kind and return to use your business again.
Your customers hold the cards when it comes to getting your name out there. You should never underestimate the power your customers have when it comes to them sharing your name. Your reputation is in their hands, and if they have something positive to share about your business, you want them to put that out there.
Include freebies with purchases
Including small freebies with purchases is a great way to show your customers you appreciate them and encourage them to repay you with good feedback and may even inspire them to recommend you to others. If you don’t sell physical products, you could also share some free advice or offer a service to them for free.
Plus, people love sharing about free stuff they get on social media, so it can be a great way to get your name out there.
Many businesses crave loyal customers, and there are many theories out there on the best way to achieve this. It should be apparent now how the law of reciprocity can influence customer loyalty and be highly beneficial for your business.
There are many ways you can encourage reciprocity in your customer relationships. Rewarding your customers is one of the most effective ways to do this, and we’ve shared some of the best and easiest reward methods.
Any of these strategies should lead to a boost in your reciprocal customer relationship and positively impact your business.