6 Surprising Facts About Customer Loyalty Marketing
Finding and acquiring new customers is an essential ingredient in achieving business success, especially during its beginning stages.
In order to be recognized in the market, brands need to get the word out about their product offerings at the outset. People need to know your brand, what you offer, and why they should buy your product—all of which are crucial in successfully making a sale.
However, earning brand awareness is just the beginning, and being able to nurture the customers you’ve acquired is just as important as gaining new ones—perhaps, even more so. This is because doing so promotes customer loyalty, which is a key factor in ensuring a robust bottom line, as well as long-term success.
Here are a few surprising facts about loyalty marketing that you should be aware of.
1. Loyal clients make up 20% of your total customers, but drive up to 80% of your revenue.
This is a perfect example of the Pareto principle at work, which says that 20% of profit comes from 80% of work activity.
Productivity hackers are wont to quote this standard frequently since it allows you to focus most of your energy and resources on only a small percentage of your time, but gain the most from it.
Here’s another figure to think about as well: your loyal customers make up to 72% to 84% of the total visits to your business.
2. Loyal customers spend up to ten times more over their lifetime.
Without doubt, the lifetime value of a loyal customer is generally higher. They are likely to purchase more products from your business, spend more money on your brand, and thus, contribute significantly to your overall revenue.
Compare that to a new customer who will only buy from you 5%, to at most 20% of the time. They’re also more price conscious and will pay less attention to any outstanding features your product might have that will justify the cost.
3. Loyalty programs increase customer visits by as much as 44%.
Loyal customers are those who visit your store at least ten times, and those who participate in specialized programs such as customer loyalty programs or VIP campaigns will come to your store even more frequently—increasing the chances of more purchases and more revenue.
Aside from that, they’ll be more likely to tag along people they know during this visit, increasing your likelihood of acquiring new clients even more.
4. Loyalty program members are up to 70% more inclined to tell their friends and family about your business.
The right VIP programs that are properly executed can earn even more loyalty and strengthen the bond you’ve forged with current customers. These types of campaigns can also earn you brand ambassadors and rabid fans that will help spread the good word about you, without necessarily asking for it.
5. The right programs can turn a new customer into a loyal one.
When customer analysts and data are put to good use, it can be a powerful means of earning new loyal clients. You can target certain groups that fall within certain criteria and send them an email or discount coupon to encourage them to return, and hopefully purchase more.
6. Up-selling to loyal customers is as much as 70% more successful than up-selling to new ones.
With new customers, the likelihood is a dismal percentage—less than 1%!
Whereas doing the same thing to customers you’ve earned the trust and loyalty of will result in a more positive outcome, all the more reason to focus your energy on forming and nurturing strong bonds with your current clientele.
Acquiring new customers should not be the be-all and end-all of your marketing strategy. Take the time to come up with a customer loyalty program that fosters a strong relationship with current customers.
Doing so will ensure repeat clients, brand ambassadors, and delighted customers who would be more than happy to spread brand awareness on your behalf.