Loyalty Marketing Solutions Keep Customers Coming Back
By Jon Parrish - October 27, 2014
You’ve heard of marketing and you’ve heard of loyalty, but are you on top of loyalty marketing?
Where traditional marketing focuses on new customers, and other loyalty approaches typically focus on rewarding top customers, loyalty marketing solutions target customers who are NOT coming back and drives them to be more loyal. Loyalty marketing is changing the face of marketing as we know it.
Here are 5 reasons why targeting your marketing efforts to your current customers should be at the top of your marketing plan:
- It’s less expensive to get loyal customers to return than to bring in new ones. Here’s a stat for you:
“It costs 6-7 times more to acquire a new customer than to keep an existing one.” – Bain & Company
Every new customer you bring in has a learning curve, and you pay their tuition. They need learn your location, get familiar with your service, ask about your return policies, slow down your line to read the menu, etc. Does this mean you should stop marketing to new customers?
Not at all. You should simply make sure you are also targeting the customers who have already “passed” the learning curve.
- Loyal customers tend to spend more than new customers. Here’s another stat to think about: McKinsey and Co. claims that e-commerce spending from existing customers amounts to nearly double that of first-time shoppers. Loyal customers cost less to bring in, and they spend more. Do you think they are worth your marketing plan? I do.
- Returning customers are more likely to bring in their friends. Never discredit the effects of word-of-mouth advertising from loyal customers. When’s that last time you saw a great movie and didn’t tell someone about it?
In fact, I don’t remember the last movie I went to see that wasn’t in some way suggested by a friend. Even when I do see it advertised, I am likely to do my due social diligence and phone a friend. Create something for your customers to talk about, and let the chatter roll!
- Returning customers require less assets in the way of assets from your business. This topic relates to reason #1 but is worth hammering on. Every time a new customer comes through the door they are learning. What’s the food like? Where’s the menu? What’s good? What’s not? etc. But your returning, loyal customer has it down.
They come in, order what they love, know where the products they want to buy are, return items less, and make you more money without taking up the assets.
- The more customers return, the stronger their loyalty becomes. Loyalty becomes self-propelling as customers frequent your business more often. As creatures of habit, we (humans) settle-in, and the places we frequent become the places we find comfort.
The more experiences consumers have with your business, the more your business comes to mind. As customers become loyal, they’ll see products on the street that remind them of you. They’ll have good scents and designs remind them of you. Fonts, music, and more all will come to mind as customers associate things with your business.
Remember, your marketing plan shouldn’t stop when customers walk through your door; it should begin. Make loyalty marketing solutions a dynamic part of your marketing plan.
Engage and re-engage your customers and you’ll see a huge benefit to your bottom line. Your profit margins will go up, your revenue will go up, and your marketing spend will go down!
Have you seen the power of already-loyal customers in your business? Share your thoughts in the comments.