Customer Loyalty, Do You Have It?
Customer loyalty helps businesses adapt to changing economies.“It is not the strongest of the species that survives, nor the most intelligent. It is the one most adaptable to change.” Charles Darwin
During an economic recession there is less money flowing in the economy. Companies are finding ways to eliminate wasteful spending and reduce operating costs.
Given the need to keep costs low, it is important that you focus on your existing customers through customer relations. Existing customers cost 6-8 times less than acquiring a new customer. That means that if it cost you $10 to contact an existing customer, it would cost you $60-$80 to acquire a new customer.
Loyalty programs help facilitate customer loyalty to your business and a loyal customer is worth 10x the value of a single purchase customer.
It just makes financial sense to build a relationship with a customer that has already displayed an interest in your products and/or service. Not to mention the fact that existing customers are 700% more likely to pay you a visit.
If that is not enough to convince you how valuable loyal customers are, here are a few more reasons:
• Having loyal customers insulates your business from competitive and economic assault which means that your income is consistent no matter what state the economy is in.
• Loyal customers generate repeat sales at a fraction of the marketing cost and effort required to find, inform, interest and sell prospects. As I said before, about 7x less money that you would have to spend to generate profits for your business.
• Loyal customers spread good will for your business and bring in a tide of new customers. They become walking advertisements for your business for free.
• Loyal customers are the best source of qualified referrals. Again, a source of free advertising.
• Customer loyalty account for higher buying rates and lower marketing and service costs than other customers. You can achieve more profits with the same marketing budget.
• Loyal customers respond to customer service that costs far less than the cost to recruit a new customer. Because they are already familiar with your business, better service is more reason for them to return which means more profits for you.
• Loyal customers lead to a loyal staff (and vice versa). This is because the longer term relationships create a pleasant environment in which to work and do business.
Gaining your customers' loyalty is simple and effortless, if you have the right tools and support.
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