The Insider Buzz With Loyalty MarketingMay 27th 2015
Loyalty marketing works to turn existing..Stats and Facts
By Kylee Geisler - September 14, 2014
Loyalty marketing is an approach to marketing that focuses on increasing business revenue by targeting existing consumers. While most marketing companies focus their entire efforts on finding new customers and most loyalty programs are made to simply reward customers who come in frequently; the concept of loyalty marketing suggests you actually track and target customers who have already come through your doors.
CityGro has developed processes and technology that dramatically simplifies the process of cultivating your existing customers and encouraging them to keep buying from you. The first way how loyalty marketing can help your business is using the CityGro kiosk to automate critical customer communication and grows your value to the people that matter most.
Current customers are more likely to come back than new customers. By bringing past customers back in you will see an increase of revenue. We’ve heard business owners say, “It’s easier to get an old customer to return than to bring a new customer in for the first time.” Past customers have already learned the route to your business, know the service they’ve received, and the quality of your product. However, it’s all too common to see the average business devote little or no effort into keeping in contact with past customers and will concentrate most of their resources trying to bring in new customers.
According to Marketing Metrics, the probability of selling to an existing customer is 60-70%. The probability of selling to a new prospect is 5-20%
In fact, it costs 6–7 times more to acquire a new customer than retain an existing one (Bain & Company). New customers are expensive to bring in because you have to educate them on your product and services. Use your existing customers to decrease your marketing costs.
For example, think of marketing channels as a series of rental networks—if you want to put your business in front of their network you have to pay the high cost to rent them. Businesses that capture customer data have the benefit of using their own network instead of renting others. They decide how, when, and what to promote to their network. Take away the dependency on other marketing networks and start building your own!
The fastest way to double your revenue is to get your current customers to come back twice as often. How do you get them to return? Refer to our 10 practical steps to customer loyalty. How loyalty marketing can help your business is most effective when based on data. We reach out to the customers who want communication. By first capturing customer information, tracking their behaviors, and then sending relevant messages, customers are more likely to keep coming back.
The best way to bring in new customers is by getting your current customers to share their experience with your business to friends and family. By utilizing your network of existing customers you can find new customers. Have you ever seen a movie or tried a new restaurant based on a friend’s suggestion? It happens ALL THE TIME. Encouraging your past customers to spread the good word can go a long way for your business. While the quality of your service is a big deal, why not build promotions to help existing customers bring in new friends?
Assuming you have already started tracking customer data, send a text message to all of your past customers, including an incentive to bring in someone that is not in your database. You’ll soon see the power of utilizing your past customers.