It’s cheaper to retain an existing customer than to attract a new one. But did you know that returning customers also often bring in more revenue for your business?
On a month to month basis, returning customers in coffee shops bring in double the amount of revenue as new customers. For hairdressers it’s about 1 and a half times.
This applies across many industries, and shows how important it is to monitor and encourage your customers to keep coming back.
Because loyalty is key, it’s crucial to understand:
- How much of your business is driven by returning customers
- How to encourage first time visitors to return
- How you can make sure your loyal customers keep returning
1: Using your Yoco Business Portal to understand how much of your business is driven by returning customers
As you look to grow, your Yoco Business Portal is a great tool to understand your business and track your progress.
In your analytics dashboard there is a graph that shows your returning customers. Here you will be able to see what portion of your customers came back to your business in the last 7 days or last 30 days. You can then track your progress as you experiment with different strategies to increase loyalty. You’ll be able to get an idea of what works and what doesn’t by monitoring if your percentage of returning customers increases or decreases.
Simply log in here and see what proportion of your customers are regulars.
2 and 3: Keeping loyal and first time customers returning
If you’re a new business
For new businesses, it helps to set your focus in the first 6 months of operations to ‘acquire customers who will return to my business’. Easier said than done, but doing this gives you and your staff the key interaction to focus on to drive your business forward.
Try asking: What would make someone’s first experience so extraordinary they would have to return?
This could be anything from a warm greeting and complimentary snack upon arrival, to a free gift with a certain purchase. Handwritten notes are a simple touch but can go a long way in creating a good relationship that encourages your customers to come back to you (these work especially well for products like jewellery).
Loyalty cards where customers collect stamps for each purchase and get “Get your 10th muffin free” also work well.
If you’re an established business
For businesses that have been around for a while and have a steady flow of customers, it is useful to focus on making those customers come back to your business more often. In order to do this, you’ll need to understand their behaviour.
Try asking: Where else do they go and why? Is there a different product or service that would better serve them?
Once you have an idea of this you can figure out ways to incentivise these customers to choose your business over your competitor.
Try asking: How might we make our less loyal customers return more?
Once again, loyalty programmes are a winner. You could implement a “points” system where customers accumulate points for qualifying purchases, which they can then use for future purchases from your store.
Another option is to create a “club” where membership gives customers access to certain benefits. For example, a hairdresser might have a membership programme for a certain fee per month. Customers who belong to this club get exclusive discounts on hair products, treatments and a free manicure when they come for an appointment.
How do you encourage your customers to return to your business? Let us know on Twitter at @Yoco_ZA.