3 Ways Your Current Customers Can Boost Sales Now
With the so-called retail apocalypse on everyone’s mind, companies devote much of their time to acquiring new customers, sometimes putting existing ones on the back burner. However, research suggests that your current customers are far more valuable when it comes to driving sales. Let’s first explore why this is true, followed by strategies you can use to increase customer value.
How Current Customers Drive Sales
Your repeat customers are one of your most effective forms of advertising. They not only spread the news about you by word-of-mouth, but they also post positive reviews online, which potential shoppers use when deciding to make a purchase. Additionally, they spend 67% more than first-time customers, and, on average, “spend more than twice as much as their original expenditure after they have been a customer for more than two years.” As for acquiring new customers, research indicates that the conversion rate for prospects, in general, is from 5-20%, while the conversion rate for prospects in eCommerce is anywhere from 1-4%. What’s more, it typically costs between six and seven times more to acquire new customers than to retain current ones. On the other hand, the conversion rate for existing customers across multiple channels is 60-70%.
Unlike shoppers that haven’t converted yet and could just as easily do business with your competitor, repeat customers are more likely to buy from you, “even if you sell the same product at a higher price.” Second-time customers also refer an average of three people to a business, while ten-time customers refer an average of seven people. In fact, word-of-mouth recommendations alone influence 80% of purchases, and people who are referred to a business are 3-5 times more likely to become repeat customers themselves.
How to Increase Customer Value
The statistics above show what your repeat customers do, but how do you keep them loyal? Here are three tips on how to increase sales in retail by promoting reviews, repeat purchases, and social media sharing.
Tip #1: Ask Them for Reviews
One of the most convenient ways to increase customer reviews is through transactional communications such as digital and print receipts, order and ship notifications, and digital and print packing slips. Through our line of digital post-sale communications, customers can easily share their experience by clicking on the smiley face icons within the e-receipts and packing slips or the “Write a Review” link within the order notifications.
These review reminders are effective largely because they reach customers while their experience is still top-of-mind, but follow-up emails sent a few days later can also be valuable. This is especially true if your product requires customers to try it out to see if it meets their expectations. No matter what medium your customers use, review prompts ensure they never miss an opportunity to tell potential customers about your product and brand experience.
Tip #2: Reward Repeat Purchases
Another way to increase customer retention is to incentivize them through loyalty club membership, coupons, and product recommendations found in our dynamic post-sale communications. Email and SMS receipts garner open rates of up to 70% and click rates of up to 15%, making them an ideal avenue for driving repeat purchases. For example, in our recent e-receipt campaign with GNC, the health and wellness company saw a 10x lift in sign-ups for their paid loyalty program, My GNC Pro Access. Additionally, over 10% of customers opted in for an auto-delivery plan from a prompt within the e-receipt, while 7% of sales from digital receipts came as a result of product recommendations.
Tip #3: Offer Incentives for Sharing on Social Media
In the same way that transactional communications can promote repeat purchases, brands can use promotions on social media to keep customers loyal. Whether your customers tell their followers about a positive experience with your brand or share photos and videos of themselves using your product, they are a crucial link in reaching new prospects. In order to ensure that customers continue to promote your brand, offer incentives with a specific call to action, such as, “Post a photo of yourself using [product name] for a chance to win [a cash prize, merchandise, etc.]”
Although rewarding customers with something tangible for promoting your brand is an effective strategy to boost sales, Social Media Explorer points out that simply acknowledging them can be a reward in itself. The article says the more you acknowledge your customers (e.g. by reposting or commenting), the more likely they are to promote your brand and products to friends. As basic as this might seem, it reminds us that brands don’t always have to rely on discounts, giveaways or big-budget ad campaigns to retain customers and even acquire new ones.
Repeat customers are not only more profitable to your brand than new prospects, they’re also your best brand evangelists. They’re able to influence and even convert their peers in an era when people trust personal experience over advertising. Using the above strategies, you can cultivate loyal shoppers who drive both sales and new customers to your door.
DON’T MISS OUT ON FULLY LEVERAGING YOUR CUSTOMERS
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