What is your current Marketing Focus?
This article seeks to reveal some amazing facts related to the loyalty of customers in relation to the market and small businesses.
Generally, it is believed that focusing on acquiring new clients should be the focus of advertising. But the question is, does this truly lead to a more profitable business? This article analyses the figures in the background.
Customers who have visited at least 10 times are referred to as loyal customers and statistics reveals that they form about 20% of the entire Clientele base. This shows that 80% of your revenue is driven by 20% of your customers which actually are your loyal customers while 72% are just visitors to your business premises. Loyal customers can also account for up to 74% of total visits. For different outfits, here is the contribution of loyal customers to total number of visits:
• Retail – 60%
• Desserts – 65%
• Fine Dining – 70%
• Night Life- 70%
• Casual Life – 70%
• Coffee & Tea – 85%
Studies revealed that loyal customers spent 10 times more in spending over their lifetime. New clients are cautious when it comes to spending making the probability of a sale about 0.2. For daily deal customers, only about 30% will spend more than the discounted price of the deal while less that 20% of daily deal customers will pay the full price of the commodity. For promotions sent to new customers, the average percentage of sale is less than 1%.
Loyal customers are more likely to spread awareness about your brand, they are of more long term value to your business as they spend more time generating revenue for your business. They are interested in hearing from you with respect to promotions, coupons and updates from your business. As a result of this awareness, there is a high probability selling more to clients, an increased 60-70%. So it can be seen that the implementation of a modern digital loyalty program is an efficient way to grow and generate more revenue for your business.
Benefits of Loyalty Program
Here are some reasons why a loyalty program is the best way to grow your business.
1. With respect to your VIPs, it helps you keep track of them hence you can improve your service to them and reward them for continuous patronage.
2. A well-structured loyalty program increases visit of customers by 12-44%. This ultimately transforms to an increase of up to 44% in revenue.
3. Loyalty programs can turn casual or new clients to loyal ones. All you need is the right program targeted to a specific group of customers, transforming them to becoming repeat customers.
4. 73% of consumers look at price and value as the leading factor that determined brand loyalty.
5. 28% of consumers are loyal to their providers and brands.
In summary, make sure your focus is on loyal customers, by this, you will not leave extra revenue on the table.