There’s nothing more attractive than the promise of something new. The word “new” has some of the most alluring words connected to it: advanced, modern, pristine, fresh…
For a small business owner, new can mean so many great things: new store, new location, new equipment, new sale, new customer…well, you get the picture.
We all love new things.
With the thousands of tasks that run through a business owner’s mind on a daily basis, acquiring new customers and boosting sales make it to the top three, most vital.
With so much time being dedicated to the new, generating new business from existing customers is in danger of falling through the cracks, or even dropping off your radar completely. Studies show that an increase in spending by existing customers by only 5% can boost a company’s profits by as much as 95%. Given all that, can you really afford to forget about repeat customers?
If the above stat didn’t grab you, here’s more about why you need to be focusing on delighting existing customers and offering targeted opportunities for them to re-engage, and what you might be missing out on (hint: money) without it.
1. Buying New vs. Maintaining Old
It costs 6-7 times more to attract a new customer than it does to keep an existing one. Acquiring a new customer takes a special amount of effort and money, whether it’s through new marketing campaigns, advertisements, social media or cold calling. With all the work you’ve put in to get your existing customer through the door that first time, why waste that effort? Although it’s important to continue to attract new customers, you don’t want to lose customers with whom you have invested so much time, money, and effort. The lifetime value of a returning customer for your business can equal 10 times the value of someone new.
2. Existing Clients Spend More Money
On average, current customers spend 67% more than those who are new to your business. Current customers know your business, are satisfied with the service you’re offering, and are more open to upsells. Make sure you’re fostering relationships with your existing customers because their loyalty increases your revenue.
3. Existing Customers Attract New Customers
Your existing customers are the ones that are most likely to post online reviews, which is important for finding new customers. 85% of customers use online recommendations to find local businesses, so you want to make sure that the feedback continues and grows. With widely popular online review sites like Google, Yelp, and Yellow Pages, you want your new customers to be able to check out the feedback others have left about your business and make their decisions based on that. This is where growth from existing customers comes in…and how we lead to our next point…
4. Existing Customers Love Online Reviews
Think back to your customer reviews and referrals: the good, the bad, and the ugly. For all those great, positive, reviews your business has received, how many of them are from customers that are looking to come back to your business? Good experiences lead to good reviews, and your repeat customers are the ones who are enjoying their experience with your business the most. Maintaining relationships with these customers and finding ways to retain them is key for keeping up your online reputation. With 92% of consumers believing these types of recommendations over other forms of advertising, it’s obvious to see why this is important.
5. Competition Doesn’t Stand a Chance
This is where we come full circle: repeat customers breed customer loyalty. It can cost almost 10 times more to acquire a new customer, so you need to make sure you’re keeping your existing customers loyal to your business. No matter what method you use, from a point system to exclusive promotional offers for your most frequent customers, your loyalty program will keep your competitors from encroaching into your customer-base. The competition doesn’t stand a chance against your business, especially if you’re offering them something they aren’t -- special rewards for their loyalty.
Think of your regulars and think about why they keep coming back to your business. Just imagine a world in which you can create relationships similar to the ones you have with them, but with all of your customers. Repeat customers are the key to growing your business, both in size and revenue. Have we convinced you yet?
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