Blog Post

Repeat Customers vs. Loyal Customers

Guest Author Amanda Majewski, Director of Payroll Services at HireLevel

The payroll service industry is based on repeat customers.  Every week, every month, we process payroll and bill our clients.  But a repeat customer isn’t necessarily a loyal customer and knowing the difference can you help maximize revenue, minimize cost and pave the way to growth.

So what’s the difference?  Repeat customers purchase out of convenience, price, or simply familiarity.  For example, you probably repeat purchase gasoline at a station near your home or office.  But are you loyal to that station?  Would you continue buying if another nearby station offered a lower price or better service?

According to Gartner Group, a Connecticut-based research and advisory firm, loyal customers represent about 20 percent of a company’s total customer base can drive up to 80 percent of business. Further, a study by Bain & Company, a global management consultancy, showed that boosting retention rates by just five percent can, in turn, raise profits by 25 percent to 95 percent; and a 10 percent rise in customer retention can yield a 30 percent increase in the value of the company.

Unfortunately, many payroll service bureaus learn the hard way that repeat customers are not loyal customers when an aggressive competitor comes to market and many of their clients jump ship. So what should you do to avoid this potentially catastrophic situation?

Start by taking an honest assessment of your clientele by asking these questions:


  1. Do you regularly, and proactively, communicate with customers?
  2. Do you make time to spend face time with clients?
  3. Do your clients respond when you invite them to events, webinars, etc.?
  4. Do your clients provide you referrals?
  5. Are your clients’ billings increasing year over year or month over month?


If you’ve answered “No” to more than one of the above, take an honest assessment of the true loyalty within your customer base. If you sense that a client, or clients, are not loyal and at risk of leaving, what should you do?   There are actions you can take.

Follow-Through and Follow-Up.  Building loyalty relies on building trust and building trust relies on demonstrating your expertise and reliability.  Following through means simply that you do what you say you will do.  This is probably no different than how you operate every day.  But, take the next step to Follow-Up and communicate, document, and then communicate again.  Reach out proactively to your customers to touch base even when no issues exists.  Schedule regular customer calls, visits or video conferences to assure all issues are fully resolved and to discuss further proactive steps.  If you do it consistently, follow-through and follow-up, you will earn trust and loyalty.

Consistency is also the key to building your brand as a trusted service provider. Develop a consistent message that describes your core value and work diligently to spread that message throughout your community and your industry. Participate in community and industry events.  Attend the Chamber of Commerce, Rotary, or other community organizations.  Schedule speaking engagements, write a blog, participate in online discussions.  Whatever tactics you choose, be consistent and remain visible.

Woody Allen once said, “Life is 80% about just showing-up.”  It’s true of life and it’s also true of creating customer loyalty.  Showing up means being consistent, following through and following-up.   Focus on these simple strategies and you will create loyal long term customers.


This blog post is authored by Amanda Majewski, Director of Payroll Services at HireLevel, a human capital management company with 12 locations nationwide. Amanda can be reached at 618-993-8836 OR