9 Ways to Measure Customer Loyalty

Why is customer loyalty important? It's needed for long-term B2C success. In restaurants and convenience stores (c-store), it helps you keep your current guests. But keeping loyalty is a challenge. 

A 2022 survey shows that seven out of ten Americans say loyalty programs are a major factor in staying loyal to their favorite brands. This shows how important these programs are. But how do you know if your efforts are working? 

To measure loyalty programs, you need to track the right customer loyalty metrics. That lets you:

• See the success of your strategies 

• Improve what’s not working

• Get more profit

Let's get to it.

How to Measure Customer Loyalty 

Customer loyalty creates business growth. You need to know what keeps them coming back to your brand. Understanding the average customer lifetime value (LTV) and customer future value (CFV) shows what you can expect from your average loyalty program member. 

Measure loyalty using: 

• Customer Retention Rate 

• Net Promoter Score (NPS)

• Customer Lifetime Value (CLV) 

• Repeat Purchase Rate (RPR) 

• Customer Satisfaction Surveys 

We’ll take a closer look below.

Customer Loyalty Data 

Several tools help businesses track customer loyalty. Here are two:  

• CRM systems: Platforms like Salesforce, HubSpot, and Zoho provide a view of your guests' buying journey.
• Data analytics platforms: Tools like Google Analytics and Tableau let your business see customer data. 

4 Things to Learn From Customer Loyalty Data 

Data helps you take the right actions. Here are four examples:

1. Segmentation of Loyal Customers: A quick-service restaurant (QSR) finds that families with children visit most on weekends. Try discounted kids’ meals to boost these visits.  
2. Personal Loyalty Programs: Use customer purchase history to offer personal discounts. 
3. Predicting Retention Decline: Early identification allows your business to re-engage customers before they leave. 
4. Improving Customer Experience: A fast-food service may notice complaints about long drive-thru wait times. This can help the business improve the order setup.

Customer Loyalty Data 

Understanding customer loyalty involves both qualitative and quantitative understanding. This means knowing the most popular ordering times and whether a new product launch is profitable.

1. Qualitative

This focuses on understanding the "why" behind customer actions. It involves getting insights through:

• Customer feedback 

• Surveys 

• Reviews 

• Social media 

2. Quantitative 

This uses hard data, such as

• Purchase frequency 

• CLV

• Retention rates 

• NPS 

This data helps businesses understand customer behavior.  

How to Understand the Data 

Create customer groups based on behavior to improve your loyalty program.  See how your customers are feeling with: 

• Reviews 

• Social media

• Feedback 

Look at purchase patterns to help see what your customers will do in the future.

5 Guest Loyalty Data Points 

Figuring out total guest engagement with customer loyalty software is a must. Here are five ways: 

1. Customer Retention Rate

This tracks the percentage of customers who continue to buy from you.  

Formula:  

(Customers at the end of the period - New customers acquired during the period​) / Customers at the start of the period) x 100 

Example:  

• Customers at the start of the period: 200 
• New customers during the period: 50 
• Customers at the end of the period: 180 
• Result: 65%. There’s room for improvement.  

2. Net Promoter Score (NPS)

NPS tells you how happy your customers are and how likely they are to tell a friend. The scale is from 0 to 10.  

• Promoters (score 9–10): Customers who are likely to recommend your product or service. 
• Passives (score 7–8): Happy customers but probably won't tell others. 
• Detractors (score 0–6): Customers who won't recommend. 

Formula:  

NPS = % of promoters - % of detractors

Example:  

Out of 100 respondents: 

• 60 are promoters (score 9-10) 
• 30 are passives (score 7-8) 
• 10 are detractors (score 0-6) 
• Result: 50, which shows that most customers would recommend the business.

3. Customer Lifetime Value (CLV) 

CLV considers: 

• Purchase frequency

• Average order value (AOV) 

• Retention rate 

• Customer lifespan 

Formula: 

CLV = Average Purchase Value x Purchase Frequency x Customer Lifespan 

Example: 

• Average purchase value: $50 
• Purchase frequency: 10 times a year 
• Customer lifespan: 5 years 
• Result: $2,500 expected to be spent by the customer

4. Customer Surveys

Happy customers are more likely to become loyal. Surveys track customer engagement scores, which help predict future loyalty.  

Formula:  

Average Satisfaction Score = (Satisfaction Scores of all respondents / Total number of respondents) 

Example:  

• Survey of 5 customers: 5, 4, 5, 3, 4. 
• Result: 4.2 out of 5, which is strong. But you can still improve.

5. Repeat Purchase Rate (RPR)

This shows how often customers return to make more purchases.  

Formula: 

Repeat Purchase Rate = (Number of customers who made more than one purchase / Total number of customers) x 100

Example:  

• 50 customers made repeat purchases out of 200 total customers. 
• Result: 25% come back for more. 

How to Measure Brand Loyalty 

Brand loyalty is more emotional than customer loyalty. It’s when customers have a strong preference for a brand. They associate themselves with the brand’s values. Understanding your guests better than your competition is why customer loyalty is so important.

4 Ways to Measure Guest Loyalty

Here are four ways: 

1. Brand Equity: This is the value a brand adds to its products based on how customers view your brand. It’s often measured through customer awareness, brand associations, perceived quality, and brand loyalty. 
2. Common Methods: Surveys ask your customers to share how they feel. 
3. Share of Voice (SOV): SOV shows how often your brand is talked about. It can be measured through social media mentions, online reviews, or advertising. 
4. Customer Advocacy: Tracking referrals, online reviews, and the customers who tell others about your brand.

Brand Loyalty In Marketing 

Use what you learned about brand loyalty in your marketing:

• Emotional Connections: Share stories, experiences, and values that match your audience’s beliefs. 
• Loyalty Programs: Design loyalty programs that reward your customers. 
• Watch Competitors: Adjust what you do based on what is working for competitors.
• Brand Experience: Your customers should always enjoy the experience.

6 Loyalty ROI Examples from Paytronix Clients

Our own data shows the power of loyalty programs across restaurants and convenience stores.

1. A C-Store Chain's Success

One example is a c-store chain that overcame Shell Rewards' competition. It partnered with local football teams and targeted energy drinks.

This resulted in a 5% increase in in-store sales, with both unique account visits and spend per visit going up by 50%.

The brand showed energy drinks as their "Best Category." It created campaigns around this guest preference.

2. One Pizza Brand's Payoff

A pizza brand used playoff excitement with click-to-load rewards that created: 

• 171 first-time guest visits

• 75 brand new registrations in a month

• 4,241 redemptions and $31,616 in redemption spending

3. QSR Brand's Double Points 

Another QSR brand discovered that double-points campaigns performed as well as dollar-off discounts. They showed that bounce-back offers had the same redemption rates but drove higher third-visit frequency.

These results show how strategic loyalty makes more sales without big discounts. 

4. Full Service Restaurant's Growth

Full-service restaurants have seen better enrollment with Paytronix's platform. One brand used a limited-time BOGO appetizer offer. It produced an 81% enrollment attribution rate, with 36% of new members joining the next campaigns. 

5. Restaurant Brand's New  Offers

Another restaurant brought back their win-back campaigns with updated offers. It produced 11.5% visit lift and 3% spend lift.

6. C-Store Loyalty Program Restructuring

A convenience store chain's program changed to a click-to-load model. It:

• 2x daily registration volume

• Increased mobile app usage by 34%  

• Achieved double-digit growth in visits, unique visitors, and gallons purchased

Frequently Asked Questions About Measuring Customer Loyalty  

What are the ways to measure customer loyalty? 

• Customer Retention Rate
• Net Promoter Score (NPS)
• Repeat Purchase Rate (RPR) 

What is customer loyalty analytics? 

• CRM Systems: Tools that track customer data and loyalty marketing strategies. 
• Data Platforms: Platforms that show customer data to find trends.

How do you measure brand loyalty? 

• Brand Equity
• Brand Attachment
• Share of Voice (SOV):
• Customer Advocacy 

How many customers should you survey? 

It depends on your business size. But the larger your sample size, the better your results. 

The Bottom Line 

Beyond measuring restaurant customer loyalty and improving loyalty programs, you must track customer and brand loyalty. When you know this, your business can:  

• Change its strategies

• Find areas for improvement

• Change efforts to meet customers’ expectations 

Understanding this helps you keep customers and get new ones.  The benefits of loyalty programs include:

• More profits 

• Keeping more guests

• More spending by your customers

• Repeat visits

Ready to apply what you learned to your loyalty programs? Book your demo now.