Or perhaps there is a better promotion around the corner.īut there are customer loyalty marketing strategies you can use to make sure your customers are sticking around for as long as possible. Another brand may be more accessible, or they may just want to change and try out a new brand.
A loyal customer can jump to another brand for a ton of different reasons.
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How to use customer loyalty to grow your brandĬustomer loyalty is tricky because customers are not bound by anything to stick with you. These statistics show that customer retention is inevitable in the long-term profitability of your company and is something you should focus on right away. Global research and advisory firm Gartner Group also released a statistic on customer loyalty that stated 80%of your company’s future revenue will come from just 20% of your existing customers. On the other hand, the probability of selling to a new customer is 5-20%. Existing customers already have prior knowledge and experience with your brand, so it seems easier to convince them to buy from you.Īccording to the book Marketing Metrics, the probability of companies selling to an existing customer is 60-70%. It’s easier to sell new products to existing customersĮngaging existing customers is not only cheaper, but also easier. But that being said, if you don’t already have a solid customer loyalty strategy in place, we suggest you spend more effort thinking about it. Of course, a business cannot survive on just its existing customers. When comparing the customer acquisition cost, or CAC, of a new customer to an existing one, it’s clear that focusing on existing customers makes better financial sense-which is why customer engagement and loyalty are essential to any growth marketing strategy. Since they already know you and have first-hand experience with your products, you can just jump straight to giving them a good deal. You could easily skip most of the steps where you educate them about your brand. Now, imagine you were trying to convince an existing customer to buy from you again.
Once they’re on, you have to impress them enough and provide a seamless user design flow to help make purchasing easier. Then you have to convince them to take the first step in checking out your website.
You have to make them aware that your brand exists, tell them what you do, and explain why you do it better than other brands. Think about all the steps you need to take before a potential customer decides to buy from you. How expensive? According to Forrester Research, about five times as much as it is to retain existing customers!Īccording to data from Forrest Research, it costs five times as much to acquire new customers than it does to keep current ones ( how to lower your customer acquisition costs here!).
Loyalty marketing focuses bringing back and retaining existing and past customers with initiatives and incentives-which is better for your business. Most often, these strategies involve incentivizing purchases and building up customer loyalty-but more of those specifics in a minute. Loyalty marketing is a strategy that encourages your customers to do repeat business with your company again and again. In this guide to loyalty marketing, I’m going to share what loyalty marketing is, why loyalty marketing works, and how to use this strategy to keep your customers coming back and to grow your brand overall.
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