by Janet Kemmet, Graphic Response
When you are first starting out, your primary objective may be to generate traffic and bring in new customers. But once you have built a database of customers, you should capitalize on their positive experiences with your store and focus on customer retention.
Every customer you keep represents at least three that you don’t have to attract. Research indicates the cost of acquiring a new customer usually runs from two to four times the annual cost of keeping an existing customer. The largest percentage of your marketing budget should be spent on customer retention – keep the customers you have loyal and happy with your business. It is unlikely you have exhausted all of the potential opportunities with current customers. Begin your marketing efforts here.
Understanding who your customers are is critical to a successful customer retention/loyalty program. Keeping an accurate database will provide valuable insight when marketing to your customers. It will help you identify their buying habits and preferences – and when they last made a purchase at your store. Using the data to target accurately to an individual customer will help you earn credibility and loyalty.
Tap into the buying power of your existing customer base. Don’t let your customer get away without suggesting at least one other item that complements their purchase. If you are filling an online or phone order, you can make the suggestion by including product information that is relevant to their buying preferences. Consider including a small offer for their next purchase (i.e. a percentage off or free shipping). Always include an expiration date and make sure it is a small window of time. Make shopping with you a habit.
Do you have customers in your database that you haven’t heard from in a while? Reach out to them and let them know you have missed them and value their business. Make an offer to entice them to come back.
Whether you reach out to your customers by direct mail, phone or email – make sure each contact is meaningful. Reward them with value. Remember, your current customers are like money in the bank.