You might be surprised to know that the key to growing your business isn’t attracting new customers. Rather, the key to growth is getting your current customers to keep coming back. Leverage this principle, and you’ll see your business boom.
Returning Customers Fuel Revenue
If you’re investing all of your advertising dollars in drawing in new clientele, you’re missing your No. 1 source of revenue: returning clients. Getting customers to return time and again is the best way to ensure that your profits will increase from year to year.
According to one statistic, all it takes to see your financial picture improve by 10 percent is to get 1 percent of your customers to use your products or services again. Getting them to come back just one time has the power to exponentially increase your revenue.
Here’s another bit of market wisdom that points to the value of customer retention: You should be able to count on about one-fifth of your present customers to be responsible for generating 80 percent of your future earnings.
Furthermore, it’s a lot less expensive to get repeat customers to come back than it is to continually search for new business. Research indicates that it costs 25 times as much money to advertise to new clients than to entice previous customers to come back.
Loyal Customers Create New Customers
Of course, you would probably appreciate having a mix of old and new clientele for your business. Thankfully, you need not fear that focusing on customer loyalty will keep your company from growing. That’s because loyal customers have a tendency to become brand ambassadors. They become the ones who drive new business toward your doors.
When their friends ask them to recommend a provider for the product or service that you offer, your name will be right at the top of their lists. There’s a good chance that their friends will listen to what they say. In fact, people are 92 percent more likely to respond to a friend’s advice than they are to a company’s advertisements.
Effective Loyalty Programs Are Key
It’s clear that if you want to increase and expand your business and your earnings, you have to encourage customers to return time and again. Loyalty programs are designed to promote such behavior.
Loyalty card programs are one of the best-known approaches to encouraging repeat business. Typically, making purchases allows customers to accumulate points, which can then be redeemed for rewards.
Businesses that value customer retention must invest in keeping their loyalty program at the forefront of customers’ minds. Online account management is one of the best customer loyalty trends because it allows participants to keep tabs on their rewards.
Effective loyalty programs must provide rewards that appeal to customers. In general, customers love free things, so giving small gifts as a reward for making a purchase is a wise move. It’s also smart to give customers variety by changing up the available rewards from time to time. This keeps customers coming back to see what new surprises they can earn through their loyalty to your brand.
One-and-done customers aren’t the secret to business success. What you need are loyal customers who will return over and over again, and effective loyalty programs can help you achieve that goal.