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30.01.2020 15 BUSINESS The value of investing in loyal customers AS you prepare to hit "re- fresh" on your marketing strategy for the year ahead, remember, "out with the old, in with the new" does not ap- ply to everything. Acquiring new customers is vital to fu- ture growth. But acquisition should not come at the ex- pense of existing customers. Loyal customers lead to growth Keeping your current cus- tomers happy and making repeat purchases is key to growth for almost every busi- ness. Data shows customers who are devoted to your busi- ness and brand are better for your bottom line. • According to Marketing Metrics, the probability of selling to an existing custom- er is up to 14 times higher than the probability of selling to a new customer. • Bain & Company and Har- vard Business School report that "increasing customer re- tention rates by 5% increases profits by 25% to 95%." • Research found that exist- ing customers are 50% more likely to try new products and spend 31% more, on average, compared to new customers. • New customer acquisi- tion costs have increased by almost 50% in the past five years. Existing customers become brand advocates In addition to the fact that loyal customers are more like- ly to buy from a brand they trust, they are also more likely to advocate for your company. And with social media being a driving force in referrals, any- one with a computer, tablet or mobile phone can be a brand ambassador. According to Temkin Group, 77% of customers would rec- ommend a brand to a friend after a single positive experi- ence. These "mini-marketers" can supplement your own marketing efforts and sales team to bring in new pros- pects, cutting out a few steps in the customer acquisition process. They provide some- thing of value for a friend or colleague by passing along a valued referral, and you save time and money with the pos- sibility of acquiring new cus- tomers. Win-win. Special treatment Your loyal customers are in a relationship with your brand, so don't treat them like strangers. Consider what mechanisms you have in place to capture valuable data about your cus- tomers' purchases and pur- chase behavior. Then use that data to strengthen your rela- tionship. Are they due for a service call? Send them reminders. Acknowledge milestones. Has it been six months or a year since they bought that big-ticket item? Check in to see if they are satisfied. Keep them updated about promotions or product updates. Tailor your communications as much as possible. Person- alized messages make cus- tomers feel valued, stand out in their inbox and contribute to brand loyalty. There are numerous stud- ies that demonstrate the ef- fectiveness of personalized communications, email in particular. According to research, add- ing personalization to subject lines can increase open rates by 26%. Loyalty programs are anoth- er great way to create long- term relationships and boost sales. According to the 2018 Bond Brand Loyalty Report: • 77% of consumers say they are likely to stay with a brand that has a loyalty program. • 70% of consumers are more likely to recommend a brand with a good loyalty program. • 63% of consumers say they're prepared to modify their spending habits in order to maximize the benefits of a loyalty program. Reward those who are loy- al to your brand. Send out coupons and promotions, or create a point program. Fea- ture member-only discounts or special sale preview hours that incentivise loyal custom- ers to shop. Do keep in mind loyalty pro- grams don't need to be just about freebies. Find creative ways to let your loyal cus- tomers know you appreciate their devotion to your brand and give them a good reason to shop! Show them they matter Stay in touch. Don't only reach out to customers with sales opportunities. If it's been a while since you've heard from a customer, reach out just to say hello. A small touch, like an email or a birthday greeting, may not directly tie to a sale, but it will help keep your brand top of mind. Chances are at one point you've received a survey in your inbox at the end of the year asking, "How did we do?" Customer surveys are great vehicles for feedback, but in- stead of asking how their ex- perience was, how about ask- ing how you can help make the coming year even better? Skip December and send something in January focus- ing on improving customers' experience with your brand. What would they like to see from you in the coming year? What would keep them com- ing back to your product or service? Would they recom- mend your product or service to others? Their responses can help you focus your marketing ef- forts and your customers will feel valued. Despite the overwhelming amount of data, few compa- nies make customer retention a priority. Companies are missing out on the benefits of nurturing those existing relationships. As you begin to tackle 2020, remember to leverage your existing rela- tionships to help achieve your growth goals.

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