The typical calculation for determining the cost of acquisition per customer can be derived by dividing all the costs spent on marketing and other acquisition efforts by the number of customers you have. This number will vary from one company to another, but it’s typically among the largest expenses of a business.
The cost of retaining a customer, on the other hand, is significantly less. You’re increasing revenue with minimal marketing efforts. So, how do you encourage repeat customers and customer loyalty?
Loyal customers are more likely to purchase from you than any of their competitors, even if those competitors offer a lower price point. If you’re looking for ways to increase customer loyalty, try the following:
Offer a Membership Program
While some customers want the cheapest item possible, most are looking for value. They want the best products or services for their money, and if it comes with exclusivity, that’s a bonus.A membership program can increase customer loyalty because they’re more likely to exclusively use your services for their related needs. They’ve identified your company as the best value in the industry, and they’ll continually come back for more.
Keep it simple and use a simple software such as MembershipWorks, which is an all-inclusive membership service including event calendars, online payments, donations, shopping carts, forms, and member only content. You can choose the features you’d like to include for your membership, and it’s much easier and more effective than creating a custom membership platform.
In order for a person to form a habit, the rewards center of the brain must be activated. Therefore, if you want to encourage a customer to purchase from you consistently, you can improve your chances by using rewards.
You could offer a loyalty program in which customers receive discounts, bonuses, gifts, and exclusive offers. About three-quarters of customers in a CrowdTwist survey reported that they were more likely to shop with a brand that offered a rewards program.
Rewards can also be given without a loyalty program. For example, you might include coupons for future purchases with the customer’s receipt or market freebie discounts to those who have purchased from you before.
To entice the intrinsic rewards center of your customer’s brains, consider making a charitable donation on their behalf. For example, the sock-making company Bombas donates one pair of socks to the homeless for every pair they sell. While making a purchase for themselves, customers can feel good about helping others.
Improve Your Customer Service
Poor customer service is among the top reasons that a customer chooses to go to a competitor. As reported by AccessDevelopment.com, 60 percent of consumers have abandoned an intended purchase because of a bad customer service experience. Furthermore, more than 50 percent have switched service providers in the last year because of the customer service.
With just a little less than half of consumers saying they would take their business elsewhere within a day of experiencing poor customer service, you can’t afford a bad service experience. Improving your customer service from the top down is essential to landing sale after sale.
Consider some of the top companies like Amazon, Trader Joe’s, Costco, or Netflix. Bad experiences with these companies are rare because they prioritize customer service over anything else. They’ve learned that the key to retaining good customers is proper service and care, and they practice what they preach.
Rely on Social Proof
Social media marketing and advertisements are likely your best tools for re-targeting customers. People’s devices are listening—they take note of every search and can even hear what their owners are talking about. As such, social apps deliver targeted advertisements perfectly formulated to the needs of your audience. Utilize these advertisements to maintain a strong customer base.
You can also use influential marketing to your advantage. Ask influencers to try your products and review them on their platforms. Influencers may include experts in the industry, celebrities, bloggers, or even well-spoken customers. You can also use user-generated content from satisfied customers to show that your product works.
More than 90 percent of customers rely on the words of others to help influence a purchasing decision, so use that on your social pages, and you’ll see your loyalty numbers increase significantly.
Video – What is customer loyalty?
Customer loyalty is all about customers coming back for more and more, i.e., returning to buy more things from you. It is different from brand loyalty.