Customer Loyalty: Why Enhancing Customer Loyalty and Satisfaction Matters

Customer loyalty starts long before a product is launched—it begins in its very design. At Vacuumlabs, we prioritize deep user understanding to create seamless, intuitive experiences that naturally keep users engaged.

Carolina Soares

18.02.2025
5 min read

How can you build customer loyalty?

You’re in the right place for this question, our product experts and engineers have poured a lot of time into understanding the customers our clients want to build for.

Customer loyalty begins when a user feels that a product was made specifically for them – when they find real value in it and it makes their life easier. When a product becomes seamlessly embedded in a customer’s daily life, there’s little reason for them to “look elsewhere” or consider alternatives.

This highlights an important truth: loyalty often starts at the very beginning, during the product’s creation. By building something meaningful that truly addresses user needs, the likelihood of fostering loyalty increases significantly.

At Vacuumlabs, this philosophy drives everything we do. Our process begins with a deep understanding of the user. Loyalty doesn’t just emerge after the product is built – it starts in the conceptualization phase. We invest time in researching the user, mapping their end-to-end journeys, and ensuring that every feature we develop solves a real, tangible problem for them.

That said, great conceptualization alone isn’t enough. Without flawless execution, even the best ideas can fail. Loyalty is also forged through the user’s experience—how intuitive the app is, how effortlessly they can navigate it, and how much time it saves them. These elements work on a nearly “unconscious level,” creating an emotional connection that keeps users coming back.

But what about your existing products? Is there a way to build loyalty?

Absolutely, building customer loyalty isn’t limited to new products. Existing products have immense potential to foster loyalty if approached thoughtfully. While you can’t rewrite a product’s origins, you can continuously evolve and adapt it to better meet user needs.

What is customer loyalty?

The elusive customer loyalty is a term that gets tossed around a lot. At first glance – it seems like common sense: don’t frustrate your customers and they will stick around. Especially when it comes to financial businesses, this simple definition gets complicated really quickly.

Loyal customers not only make repeat purchases but actively use your products, engage across multiple channels, and advocate for your brand through referrals and feedback. How can we achieve that? We’ve consolidated some of the most important factors in this article.

Types of customers:

Let’s start with a fun exercise: can you name all of the different types of customers? We’ll cover a few specific to the banking and fintech world:

The convenience seeker: This kind of customer is most loyal to their local and most accessible businesses. They don’t necessarily love your brand, but switching is just too much effort. Maybe their paycheck is already set to direct deposit, or they’ve been with the same bank for years and don’t want to go through the hassle of moving accounts.
The optimizer: This customer is always looking for the best deal—whether it’s cashback rewards, high-interest savings, or zero-fee transactions. They’re loyal as long as your bank or fintech offers the most competitive rates.
The truly loyal: They genuinely love your brand, trust your mission, and advocate for your services. Maybe they appreciate your ethical banking policies, sustainability efforts, or customer approach. They don’t just stay loyal, they bring in others through word-of-mouth recommendations.
The tech enthusiast: These are the customers that really do their research, so don’t think you can attract them with shiny new features – they are also looking for practical solutions. Always on the lookout for cutting-edge innovation, this customer sticks with fintechs and banks that offer the latest AI-powered tools and next-gen features..
The longtime customer: They’ve been with your brand for so long that they might not even remember why they chose it in the first place. While this customer might not actively engage with all your services, they’re still depositing paychecks and using your app out of routine.
The security-focused: For them, trust is everything. They stick with a financial institution that makes them feel safe, secure, and protected from fraud. Let’s hope you haven’t had a data leak in the news – because this type of customer definitely noticed it.

As you can see – each type of loyal customer has different motivations, and keeping them around requires a mix of trust, innovation, and value.

Why is customer loyalty important now?

There are several factors in recent times that have highlighted the importance of customer loyalty. As digital advancements continue to reshape the competitive landscape, there are several reasons customers have more power:

Rising competition: The digital world has made it easier than ever for new competitors to enter the market. You could even say the market is getting over-saturated, competition from both small and major players is growing, and customers have the luxury of choice.

Empowered customers: With instant access to reviews, price comparisons, and endless options, customers can switch brands with just a click. However, strong loyalty keeps them engaged and more forgiving of occasional missteps.

Stronger word-of-mouth: Digital platforms amplify customer opinions. Satisfied, loyal customers often become vocal brand advocates, spreading positive reviews and driving organic growth through social media sites and in-person communities.

Importance for growth: Additionally, we can see in a survey published by Salithru with Forbes Insight, you can see that while more companies focus on acquiring rather than retaining existing customers – it’s actually customer retention that grows the businesses the most.

In our next section, we’ll get deeper into what customer loyalty means for a business, but first we need to understand the nuances of customer retention.

What are the nuances of customer retention in banking and fintech?

Keeping customers in banking isn’t as simple as offering a great sign-up bonus or a sleek mobile app. Unlike retail or subscription services, where customers can hop between brands on a whim, banking relationships tend to be long-term, but fragile and more high stakes. Customers don’t switch banks often, but when they do, it’s usually for good. That’s why customer retention in banking is all about trust, convenience, and long-term value.

How does customer loyalty affect business?

Keeping customers coming back isn’t just a nice way to grow your brand, it’s essential for long-term success. Loyal customers don’t just stick around; they bring stability, valuable insights, and even free marketing. The more engaged they are, the more they contribute to growth in ways that go beyond just purchases.

With rising digital expectations, banks and fintechs are expected to offer things like mobile options and additional features. Thinking about service design and UX every step of the way, proactive support, and personalized financial tools to compete with fintechs and neobanks. True loyalty isn’t just about holding a checking account—it’s about keeping customers actively using your services by making banking effortless, insightful, and truly valuable.

Why customer loyalty is a game-changer:

Reliable Revenue

Loyal customers keep coming back, meaning you have a steady stream of income. They’re less likely to jump ship when competitors offer discounts, making them a solid foundation for long-term growth.

Better Insights

Repeat customers give you valuable data on what they like, how they shop, and what keeps them engaged. That means you can fine-tune your marketing, improve products, and deliver exactly what they want—before they even ask for it.

Cheaper Than New Customers

Let’s be frank: acquiring new customers is expensive. It can cost five times more than keeping an existing one. Loyal customers save you money by reducing marketing costs while still driving sales.

Higher Spending Over Time

The longer someone sticks with your brand, the more they’re likely to spend. Whether it’s upgrading to premium services, trying out new products, or simply buying more frequently, their lifetime value (LTV) grows.

Free Word-of-Mouth Marketing

Happy customers don’t just stick around—they tell their friends. From social media shoutouts to glowing reviews, loyal customers become your best (and cheapest) marketing tool.

Stronger in Tough Times

When the economy takes a hit, loyal customers are more likely to stand by the brands they trust rather than switch to something unfamiliar. A strong customer base can help keep your business steady, even in uncertain times.

At the end of the day, customer loyalty isn’t just nice to have, it’s what keeps businesses thriving even through tough times. Keep your customers happy, and they’ll return the favor.

Benefits of customer loyalty

When customers stick around, businesses spend less on marketing, earn more over time, and benefit from positive word-of-mouth. Here are the 3 key benefits to keep in mind as you build your next product or feature:

Steady revenue and higher customer value: Loyal customers continue to buy from you, providing a reliable revenue stream. Over time, they tend to spend more, whether through repeat purchases, upgrades, or additional services.

Lower acquisition costs and better retention: It costs far less to keep an existing customer than to attract a new one. A strong loyalty strategy helps reduce marketing spend while improving customer retention.

Stronger brand advocacy and referrals: Satisfied customers are more likely to recommend your business to others. Word-of-mouth, positive reviews, and personal referrals help bring in new customers without extra effort.

In a survey published by Salithru with Forbes Insight, you can see that while more companies focus on acquiring rather than retaining existing customers – it’s actually customer retention that grows the businesses the most.

Tips on how to keep customers loyal

To sustain meaningful customer loyalty, companies must adopt a mindset of continuous improvement. This involves regularly rethinking processes, staying attuned to emerging trends, and proactively adapting to customer needs. Listening to customers is paramount, through feedback, surveys, or analytics, to ensure their evolving expectations are met.

Understand your current users and customers: Loyalty starts with understanding your existing customer base. Dive into user feedback, analytics, and behavioral data to identify what works and where the pain points lie. This ongoing research helps you uncover opportunities.
Set the right tone with communications: This means adapting to customers’ needs, whether they want an AI chatbot that responds immediately or prefer to dial a number to get help from one of your agents. Providing options for how they can resolve issues is a simple way to make customers feel heard.
Show your customers you appreciate them: Remember, your customers are entrusting you with their finances and sometimes even paying for your more premium services. It can only help to provide the occasional discount code, free trial on a new feature, or extra bonus on rewards programs. This small investment can help secure your future.
Continuously work on your service: Adding more features and refining your product is a sure way to not only attract new customers but keep the ones you have. When customers see that you’re fine-tuning features and even adding exciting new ones, they are more likely to stick around. Not to mention and this is especially important for banks that need to compete with new fintechs.
Build a community around your product: A community is not just a way to give your customers extra value, it can be a practical way for them to navigate your services, feel more connected, and even introduce each other to new aspects of your product. Not everyone is a “lifestyle” brand, but even a small forum for your customers to gather or a strong social media presence can help.
Improve your loyalty program: If you’ve had the same loyalty program in place since the early 2000s, you may need to adjust the UX or even the rewards structure. Make sure that any programs you have are still competitive in today’s market.
Forgive mistakes: If a customer needs a refund on a payment they made or gets stuck in a foreign country with no way to withdraw funds, do you have a system in place to help them? Everyone can make mistakes or end up in unfortunate situations, and how your business helps a customer in a bad spot will leave a mark on their memory—take steps to ensure it’s a good one.
Make each purchase count: Keep any rewards or perks you have for your customers more accessible and relevant. If they can only achieve certain things with a million points or for big-ticket items, it may feel like a game they can’t win. Providing small rewards and a loyalty program for every level can be a huge help.
Start from scratch: Don’t be afraid to completely rethink loyalty programs or entire services. Sometimes, it’s best to start on greenfield to build something that will have lasting value for your customers and for your business.

What is a customer loyalty program?

A customer loyalty program is just one of many ways to build up your brand rep. We’ll cover some of its key principles here, but it’s important to explore other options.

In general, a customer loyalty program is something like a rewards system or program that keeps customers engaged and coming back. It can vary between earning simple credit card points to something as complex as gamifying entire products.

6 basic types of customer loyalty programs:

Points-Based Programs

The classic. Spend money, earn points, redeem rewards. It’s simple and works in almost any industry. Coffee shops, airlines, and retailers love this model because it gives customers instant gratification while encouraging repeat purchases. The trick? Make sure points actually add up to something worthwhile.

Tiered Loyalty Programs

Think of this like leveling up in a video game. The more customers spend, the better the perks. Bronze, Silver, Gold, Platinum—sounds fancy, right? Airlines, hotels, and luxury brands use this structure to keep customers striving for that next tier, unlocking bigger discounts, priority service, or exclusive products.

Subscription-Based Loyalty

Why wait for customers to earn perks when they can pay for them upfront? Programs like Amazon Prime, Costco memberships, or Starbucks Rewards charge a fee for immediate benefits—like free shipping, discounts, or exclusive content. If your perks are strong enough, customers will gladly pay to stay loyal.

Cashback and Rebate Programs

Spend money, get money back—it’s as simple as that. This works especially well for financial services, credit cards, and big retailers. Whether it’s 5% back on groceries or a rebate after a big purchase, people love the idea of “earning” money while they shop.

Gamified Loyalty Programs

If your loyalty program feels like a game, people will keep playing. Think spin-to-win wheels, surprise bonus points, and achievement-based rewards. This model encourages customers to engage beyond just purchases. Now famous brands like Duolingo use daily streaks, milestones, and leaderboard rankings to keep users hooked

Community or Value-Based Rewards

Not every reward has to be a discount. Some brands build loyalty by connecting with customers on a deeper level. Patagonia, for example, offers repair services to extend product life instead of discounts. Some companies donate a portion of sales to charities customers care about. Loyalty isn’t just about spending—it’s about belonging

Benefits of customer loyalty

Tips on how to keep customers loyal

Understand your current users and customers: Loyalty starts with understanding your existing customer base. Dive into user feedback, analytics, and behavioral data to identify what works and where the pain points lie. This ongoing research helps you uncover opportunities.
Set the right tone with communications: This means adapting to customers’ needs, whether they want an AI chatbot that responds immediately or prefer to dial a number to get help from one of your agents. Providing options for how they can resolve issues is a simple way to make customers feel heard.
Show your customers you appreciate them: Remember, your customers are entrusting you with their finances and sometimes even paying for your more premium services. It can only help to provide the occasional discount code, free trial on a new feature, or extra bonus on rewards programs. This small investment can help secure your future.
Continuously work on your service: Adding more features and refining your product is a sure way to not only attract new customers but keep the ones you have. When customers see that you’re fine-tuning features and even adding exciting new ones, they are more likely to stick around. Not to mention and this is especially important for banks that need to compete with new fintechs.
Build a community around your product: A community is not just a way to give your customers extra value, it can be a practical way for them to navigate your services, feel more connected, and even introduce each other to new aspects of your product. Not everyone is a “lifestyle” brand, but even a small forum for your customers to gather or a strong social media presence can help.
Improve your loyalty program: If you’ve had the same loyalty program in place since the early 2000s, you may need to adjust the UX or even the rewards structure. Make sure that any programs you have are still competitive in today’s market.
Forgive mistakes: If a customer needs a refund on a payment they made or gets stuck in a foreign country with no way to withdraw funds, do you have a system in place to help them? Everyone can make mistakes or end up in unfortunate situations, and how your business helps a customer in a bad spot will leave a mark on their memory—take steps to ensure it’s a good one.
Make each purchase count: Keep any rewards or perks you have for your customers more accessible and relevant. If they can only achieve certain things with a million points or for big-ticket items, it may feel like a game they can’t win. Providing small rewards and a loyalty program for every level can be a huge help.
Start from scratch: Don’t be afraid to completely rethink loyalty programs or entire services. Sometimes, it’s best to start on greenfield to build something that will have lasting value for your customers and for your business.

Why are customer loyalty programs important?

While they are just one path to customer loyalty, these kinds of loyalty programs have several advantages and can engage your customers in a variety of ways. There is something suitable for every business. Also – customers have simply come to expect them. The real trick is to implement them in a way that works well and doesn’t feel like a chore.

What are the must-haves in every loyalty program?

Keeping customers coming back isn’t just good for business—it’s essential for long-term success. Loyal customers don’t just stick around; they bring stability, valuable insights, and even free marketing. The more engaged they are, the more they contribute to growth in ways that go beyond just purchases.

How to build a customer loyalty program that actually works:

A great customer loyalty program is like a good cup of coffee—simple, rewarding, and keeps people coming back for more. But not all loyalty programs are created equal. If your system is confusing, slow, or feels like an endless grind for tiny rewards, customers will lose interest fast. So, how do you create a program that keeps people engaged and excited? Here are the key ingredients:

Keep It Simple

If customers need a PhD to figure out how your loyalty program works, you’ve lost them before they even start. Keep it straightforward: earn points, get rewards, repeat. No complicated rules, no hidden expiration dates, and definitely no fine print that requires a magnifying glass.

Make It Easy to Join

If signing up for your loyalty program feels harder than opening a new bank account, people won’t bother. Remove barriers—skip long forms, unnecessary details, and annoying requirements. A one-click signup at checkout or a quick opt-in through your app makes all the difference.

Let Customers Earn Points Fast

Nobody wants to collect points for months only to get a 5% discount on something they don’t even want. The best programs let customers start earning and redeeming quickly. Give small rewards early on to build momentum and make them feel like progress is happening right away.

Offer Rewards That Actually Matter

What’s worse than a slow-earning loyalty program? One that offers rewards nobody wants. If your customers are racking up points for keychains and tote bags, don’t be surprised if they stop caring. Make sure your rewards are valuable, relevant, and personalized—discounts, free products, exclusive experiences, or early access to new releases.

Keep It Fun and Engaging

A loyalty program shouldn’t just be about spending money—it should feel like a game worth playing. Use challenges, limited-time bonuses, birthday perks, and milestone rewards to keep people engaged. The more they interact, the more likely they are to stay loyal.

Add Some Surprise and Delight

Nothing builds loyalty like a good surprise. Unexpected discounts, free gifts, or bonus points just for being a long-time customer make people feel valued. These small gestures turn casual buyers into lifelong fans.

At the end of the day, the best loyalty programs are easy, rewarding, and genuinely enjoyable. If customers feel like they’re constantly working for small, meaningless perks, they’ll walk away. But if you make it effortless, fun, and packed with value? You’ll have them coming back again and again.

Let’s sum it up: how can you maintain customer loyalty?

In the digital age, maintaining customer loyalty presents a unique challenge. With the rapid pace of technological advancements, constant innovation, and the ease of information sharing, customers are exposed to a myriad of alternatives. This dynamic environment means loyalty isn’t a one-time achievement – it’s an ongoing journey.

At Vacuumlabs, we’re really enthusiastic about this journey for both our clients and their customers. We consider the end user from the very beginning of an idea to the final launch. Not sure where you get started or want to test out a bold idea? Check out our Spark program – a product discovery module that can kickstart your ideas with thorough research, user testing, roadmapping, and more.

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