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45% of your customers won’t come back.
Let that sink in.
Unlike the most recent Lego Movie, 45% of one time customers won’t come back in most businesses. And think about it, why would they? They have no loyalty to you. There is a good chance they can find what you’re selling elsewhere if they wanted to. They are your customers, not your friends. The key to getting customers to come back is to give them something that makes them feel like a friend, feel like a part of something, feel like they’re getting a deal they can’t get anywhere else- and they will be. This all starts with a loyalty strategy.
1. Use a loyalty program
Your business runs on customers. Suffice to say, the more customers you retain, the more successful your business will be. This makes loyalty programs imperative for customer retention and acquisition. A four year study done by Brian Woolf, a leading expert on retail loyalty, shows that between around 95% of new customers stopped coming back within a year’s time. By offering a loyalty program, customers have a tangible reason for continuing to come back and buy things at your store. You reward them where others don’t. Increasing your retention rate by even a few percentage points results in an exponential increase in cash flow- and who doesn’t love some good cash flow?
2. You get what you give
Creating an escalating reward system is a great way to not only keep ‘em coming back, but also to get consumers to spend more. This is the way it works: you offer higher rewards for reaching specific spending targets over a period of time. With this, customers will want to keep coming back in order to reach these thresholds. You’re basically making shopping at your store into a game that your customers win by spending more. Sounds like fun for small business owners and shoppers alike.
3. If they are your VIP customers, let them know
You should thank the people who spend the most at your store because they are the source of a good chunk of your profit. You can do this by focusing on a reward program for your best customers. This way, you can ensure that the rewards are being given to qualified customers and they’ll be spending even more because they’re getting a deal. Give your A+ customers the gold star they deserve.
4. Happy customers spread the word
People are much more likely to listen to a friend or a co-worker that refers them to a store than any type of advertising material. Because of this, it’s important to not only have loyalty programs, but loyal customers as well. The happier your customers are, the more likely they are to talk about your business and recommend it to a friend. Being nice is free and can lead to new customers, so remember… always keep your customers happy!
How close are you with your customers? Let us know in the comments!
This week, we talked to Johanna Chan, the Greater China distributor of Ril Creed, a Tokyo-based handbag brand. Not only did she introduce Ril Creed from Tokyo to the biggest department store in Hong Kong earlier this year, Johanna also launched their products 2 months ago in Taiwan.
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