Businesses are made or broken by the customers they keep. The first time customers come through your door, they should be astonished by the quality of customer service. But one-time customers are only good for one sale. The greatest corporate empires in history understood that business requires repeat customers. Bringing your customers back again and again is critical to long term success. Everything about repeat customers is beneficial for your business. Repeat customers are valuable to your business because they already know you, they already know your product, and they have already provided their information. The hard work is done, but the intricate dance has just begun.
Repeat Customers: The Numbers Add Up
The benefits of reactivating customers are well known in the business world. Several studies have been conducted by groups such as the National Law review, and their revelations are startling. The National Law Review discovered that it can cost up to five times more to find a new client than to keep an old one. This isn’t just a financial cost either. The time, manpower, resources, and yes, money, the costs add up quickly. Bain & Co discovered that a 5% increase in customer retention can mean a 75% increase in profitability for those customers. In a similar study, Bain & Co. found that a repeat customer will spend 67% more over the next three years. That’s why it is imperative to keep your customers coming back for more.
Repeat Customers Mean Repeat Purchases
Staying on your customers good side is always a good idea, but there is a difference between “staying on someone’s good side” and “keeping them actively involved.” Customer relations is everything, and the benefits of positive word-of-mouth cannot be overstated. But it is imperative that your customers keep coming back for what you are offering. Repeat customers are great for your business for quite a few reasons:
They already know you: Customer loyalty Is worth its weight in gold. It isn’t unlike meeting a date for the first time. When you introduce yourself, you know nothing about who you are talking to. Everything is awkward. No matter how hard you try, you will always second guess yourself afterward. But the second date, or the previous customer, is so much easier. You already know what they want. They already know how you conduct your customer service. It’s not about good impressions anymore. Now, it’s business. Both sides have something the other wants. It’s your job to make the first move.
They understand your products: There is nothing worse than having to start from scratch in a business deal. Starting from scratch means that if something goes wrong, or there is a misunderstanding, you have no history to fall back on. Reactivated customers already know you offer a quality product. The only challenge here is to show the customer that their actually is an advantage to purchasing from you again.
Past customers have given you their information.
Giving out new information is always a risky business. As a consumer, you cannot know if the business will be responsible with your sensitive data. As a business, convincing a potential customer to trust you can be like walking a tightrope, blindfolded. With a reactivated customer, that awkward first step has already passed. You know their contact information, their preferences, and their history. In a world where knowledge is everything, you are ahead of all competitors. The trick is not to abuse this information. They have trusted you with it, now it’s time to earn that trust. Send out one message, maybe two. Don’t overdo it, or you’ll find out that an annoyed customer is worse than an inactive one.
Give Them a Reason to Come Back
Your customers didn’t actually leave, they are just content not to buy again. If you need to offer an incentivizing coupon to bring them back, it’s a good investment. It’s possible that they also don’t know what you are offering, so put together a newsletter. Or maybe when they purchased, their purchase satisfied the need they had. If your first product did such a great job, don’t be afraid to demonstrate how your other products can help them with new challenges. Figuring out how to reactivate your past customers is a great way to increase customer lifetime value.