Automation of loyalty program process flows
Posted: Mon Dec 23, 2024 6:37 am
Many organizations focus most of their marketing efforts and budgets on acquiring new customers. In doing so, they fail to nurture their existing customers, leaving many to seek products and services elsewhere.
Studies consistently show that retaining customers and selling to existing customers can improve a company's bottom line. Experts say the chances of selling to an existing customer are 60-70%. But the chance of getting a new customer to buy products is only 5-20%. Additionally, it's important to know that:
Repeat customers spend on average 31% more opportunity seekers email list than first-time customers.
A 5% increase in customer retention produces more than a 25% increase in profits .
Customers who feel an emotional connection to a brand have a 306% higher lifetime value (LTV) . They stay loyal to a brand for an average of 5.1 years versus 3.4 years, and are almost twice as likely to recommend brands.
A customer loyalty program is a very effective way to boost retention.
What is a customer loyalty program?
Wikipedia defines a loyalty program as "a marketing strategy designed to encourage customers to continue to make purchases or use the services of a business associated with the program." There are many types of customer loyalty programs. For example, earning points for each purchase and redeeming them later. Or, offering discounts for spending a certain amount of money.
Benefits of a Customer Loyalty Program
Customer loyalty programs offer a wide range of benefits. These include:
Boost customer loyalty
A loyalty program provides incentives for customers to stay loyal to a brand. For example, product discounts and a higher level of personalization. This helps provide a better customer experience and discourages customers from looking for your competitors.
Reduce costs
According to Bain and Company, acquiring a new customer costs 6 to 7 times more than retaining an existing customer. By increasing LTV, companies can reduce their customer acquisition costs.
Get social proof
Social proof has, in many ways, transcended conventional forms of advertising. Over 90% of customers say they are more likely to trust unpaid recommendations than any other type of advertising. Loyalty programs can encourage customers to post reviews, which can help generate new business.
Collect customer data
When a customer signs up for a loyalty program, they typically consent to the collection of personal information. For example, demographic information, interests, and geographic location. Customers can also participate in surveys to earn additional loyalty points. Organizations can use this data to provide customers with a personalized experience and to improve their products and services.
More customer recommendations
Studies consistently show that retaining customers and selling to existing customers can improve a company's bottom line. Experts say the chances of selling to an existing customer are 60-70%. But the chance of getting a new customer to buy products is only 5-20%. Additionally, it's important to know that:
Repeat customers spend on average 31% more opportunity seekers email list than first-time customers.
A 5% increase in customer retention produces more than a 25% increase in profits .
Customers who feel an emotional connection to a brand have a 306% higher lifetime value (LTV) . They stay loyal to a brand for an average of 5.1 years versus 3.4 years, and are almost twice as likely to recommend brands.
A customer loyalty program is a very effective way to boost retention.
What is a customer loyalty program?
Wikipedia defines a loyalty program as "a marketing strategy designed to encourage customers to continue to make purchases or use the services of a business associated with the program." There are many types of customer loyalty programs. For example, earning points for each purchase and redeeming them later. Or, offering discounts for spending a certain amount of money.
Benefits of a Customer Loyalty Program
Customer loyalty programs offer a wide range of benefits. These include:
Boost customer loyalty
A loyalty program provides incentives for customers to stay loyal to a brand. For example, product discounts and a higher level of personalization. This helps provide a better customer experience and discourages customers from looking for your competitors.
Reduce costs
According to Bain and Company, acquiring a new customer costs 6 to 7 times more than retaining an existing customer. By increasing LTV, companies can reduce their customer acquisition costs.
Get social proof
Social proof has, in many ways, transcended conventional forms of advertising. Over 90% of customers say they are more likely to trust unpaid recommendations than any other type of advertising. Loyalty programs can encourage customers to post reviews, which can help generate new business.
Collect customer data
When a customer signs up for a loyalty program, they typically consent to the collection of personal information. For example, demographic information, interests, and geographic location. Customers can also participate in surveys to earn additional loyalty points. Organizations can use this data to provide customers with a personalized experience and to improve their products and services.
More customer recommendations