Did you know that boosting your client retention rate by 5% can increase your profitability by up to 95% (HBR, 2021)? However, far too frequently, businesses prioritize acquiring new customers over caring for existing ones. You understandably want to expand your customer base. But how can you keep the customers that are more inclined to purchase from you again? One solution is to establish a customer loyalty program that rewards repeat customers.
A specialized program with customer loyalty perks is an excellent way to express gratitude. It’s certainly beneficial to your customers, but what are the specific advantages of loyalty programs for a company like yours?
The truth is that there are several financial and non-financial benefits. We understand that money does not always flow freely in small enterprises. There are critical choices to be made regarding where to put your money. Should the focus be on attracting new clients? Or on ensuring that existing customers return again after a time? Retention is generally a more efficient approach to expanding a company. Customer loyalty is an important factor. If you’re confused about whether you should prioritize customer acquisition or retention, consider the following reasons. Customers say they would switch brands for a stronger loyalty program 75% of the time. And, according to a study made by KPMG, 52% of buyers will prioritize – and shop with – brands where they have points and rewards. Loyal customers are your lifeblood.