Do you know that it costs five times more to attract a new customer, than it does to retain an existing one?* That is just one reason why companies focus their efforts on customer retention.
THE VALUE OF CUSTOMERS
According to research conducted by Bain and Company, current customers are 50% more likely to try a new product of yours as well as spend 31% more than new customers. The study also revealed that increasing customer retention rates by 5% increases profits by 25% to 95%. Happy customers also send referrals your way and advertise your brand.
CUSTOMER LOYALTY PROGRAMS
A loyalty program does more than reward customer loyalty. It attracts new buyers and enables you to collect data about who is buying your products. This insight helps you to make informed decisions about marketing strategies that reach your target audience. The statistics also provide details about what products are preferred, which can assist when buying inventory.
Customer retention and referrals bring continued business while keeping costs to a minimum. There are many types of loyalty programs from which to choose. It all impacts your bottom line.
*Research by Fred Reichheld. Fellow at Bain and Company