Building customer loyalty through workable programs should be a priority for top companies in 2021. Else, such companies may not reach their marketing goals for the year. Howard Schultz stated that “if people believe they share values with a company, they stay loyal to the brand.” Besides, statistics show that 20% of the current existing customers of a brand are responsible for driving 80% of future profits of that brand.
This fact indicates that businesses that thrive more in the coming days need to spend more effective time building and to sustain a customer loyalty program. Achieving this feat ensures that the company brand achieves maximum profit that can stand the test of time. Also, there are tremendous reasons why businesses don’t get the expected results due to several reasons. However, this article focuses more on the right strategies to build a formidable customer loyalty program.
Best Strategies to Build Excellent Customer Loyalty Program
- Increase the Probability to Sell to Existing Customers
When approaching a new customer, the probability of eventually selling to them is only between 5 and 20%. On the other hand, the probability of selling to an existing customer is between 60 and 70%, which is a greater chance. The fact is simple: existing customers already have some level of trust for your brand, and you may not have to spend much time and resources to convince them, unlike new customers.
Similar to an increased probability to sell to existing customers, the knowledge and experience of these customers. Therefore, when you recommend a brand product or service to both new and existing customers, the latter is more likely to buy due to the existing relationship. Consequently, the company can profit from extra sales without spending so much money on marketing.
- Work more on increasing positive customer feedback
The impact of positive feedbacks and customer reviews cannot be overemphasized as one of the most profitable marketing and brand-building strategies. When new customers try out your product, service, or interact with any of your brand interfaces and get excellent quality, they are willing to leave the right word behind to convince others. These useful reports or feedback can also build a brand reputation and make it easier to reach more potential customers.
However, customers look out for brands they can quickly and emotionally connect with, where the bonding builds a lasting relationship. Such satisfied customers readily provide great feedback in honest opinions and respond to relevant queries about the product and service satisfaction. This feedback can also constitute part of customer endorsement of brands, which has shown its effectiveness in growing a business.
- Incentivize your Business Referral Program
Many top businesses are presently using affiliate programs to boost their marketing and conversion chances. There is a viable way to combine both referral programs and loyalty programs towards the most significant yield of productivity. In other words, referrals can get new customers while loyalty programs can make them stay for longer fruitful relationships. Some of the specific areas where your affiliate or referral programs can bring profit include:
- The use of targeted promotions
- Using a robust network of advocates for the business brand
- Use of personalized incentives for the customers, a form of customer loyalty reward program
By the way, a loyalty program is slightly different from a referral program. The latter instead incentivizes customers so that they may convince their family and friends to purchase the product. On the other hand, a customer loyalty program encourages targeted existing customers to make repeated purchases from the company brand. Therefore, the ability to retain such customers can further build upon customer acquisition through referral programs.
- Personalize your marketing programs
As competitive as marketing programs are, a business brand must always be aware of the existing competition in the market and actively seek ways to stay afloat. One of the recommended ways to maintain a viable relationship with new and existing customers is the communication process, which must also be personalized to get great results. With personalized marketing strategies, brands can attract customers and gradually build trust and a good reputation.
Personalizing your marketing efforts also allows your targeted audience to make the difference between your brand and your competitors. However, personalization depends on the ability to acquire some customer data through business marketing intelligence. The vital information may include customer’s preferences of product type, shopping choices, location, spending habits, online behaviors, buying decisions, shopping time, and other business-related details.
- Decrease the cost of new customer acquisition
Ideally, the cost of acquiring new customers through new marketing strategies can be relatively high. For instance, a report showed that it takes up to five times the effort of selling to an existing customer to sell to a new customer https://www.invespcro.com/blog/customer-acquisition-retention/. On the other hand, customer loyalty programs enhance the chances of making more sales through existing customers than new ones. Already, statistics show that a larger part of a company’s income comes from the existing customers rather than the new ones.
While it is not bad for a company to always look for ways to acquire new customers, more efforts should be channeled in keeping the existing ones. This management can work through a viable business strategy such as customer loyalty programs to build a stable and robust customer base. As a result, the reduced cost with marketing to a new audience results from getting so many positive results from the existing customer base.
Before we call this article a wrap, every big brand must actively create a loyal customer base that continually patronizes them. Besides, they also need to invest their time and efforts in profitable strategies that can further enhance the business reach, stature, and productivity. So, instead of spending a large chunk of your marketing budget on acquiring new customers, a business brand can use some of the strategies above to retain existing customers towards more profit. Simultaneously, the size of the business does not matter in determining the productivity of this business strategy.