“An exploration of the power that brand loyalty can have on long-term business sustainability — JK
Ecommerce companies devote significant resources to acquire new customers and create demand for their product or service. But with growing competition for customers, many struggle to keep revenue strong and customer acquisition costs low.
One way to overcome these challenges is fostering strong brand loyalty with your existing customers. According to Rosetta, engaged consumers buy 90% more frequently, spend 60% more per transaction and are five times more likely to stick with a brand. This means engaged customers deliver three times the value over the course of a year which makes creating and nurturing loyal customers essential for ecommerce businesses.
The Importance of Repeat Customers
Advertising can be effective in getting you more customers but it can be expensive and risky. In contrast, repeat customers are already aware of you and, if they had a good experience the first time, they are much more likely to buy from you again. You have a 60–70% chance of selling to an existing customer while only a 5–20% chance of selling to shoppers who have not previously bought from you.
Repeat customers are not only more likely to buy from you again, they are also more likely to have a stronger attachment to your brand and willing to pay more for your products. Some companies have built such strong brand loyalty that even when they make a misstep, their customers will stick it out with them.
Loyal Customers Can Be Your Best Sales People
Loyal customers will not only buy more from you, they can also increase your sales by recommending your products to others. There’s no better advertising than word-of-mouth with peer recommendations being the most trusted source for product information.
According to a survey by Neilsen, 92% of shoppers trusted word-of-mouth referrals and recommendations from family and friends over all other sources of product information like advertisements. In fact, friends referring friends is so powerful that it’s the only form of marketing that can actually stop potential customers from doing research and persuade them to make a purchase outright.
How to Earn Your Customer’s Loyalty
To ensure customers keep coming back, the most important factor is ensuring customers have a good experience with every aspect of your product or service. According to a survey of US small business owners, the primary driver of repeat business is well-established relationships with your customer base. This includes having a solid product that provides a lot of value and backing it up with good service and a brand that aligns with the values of your customers.
Consumers want to buy from companies they like, know and trust. Having a brand that is authentic and transparent not only enhances your credibility with existing customers, it also helps you attract new customers. For example, quickly responding to negative feedback or replacing a defective item can help you gain credibility and trust. And if your brand is credible, you’re far more likely to get the sale.
Building Customer Loyalty Needs to be a Priority
Since acquiring new customers is often a costly process, enticing customers to come back time and again is critical to yourlong-term business sustainability. By establishing strong brand loyalty with your customers, you can cut down on acquisition costs and bring in strong revenue from your existing customer base.
Plus, you get the added benefits of positive word-of-mouth referrals, enhanced brand credibility and a boost to your customer lifetime value — all of which positions you well to be a powerful and long-term player in the competitive digital landscape. In short, creating brand loyalty with existing customers is one of the best investments a company selling online can make, so make sure your customers know that you appreciate their business by delivering value and great service.
Originally published at www.kiwaluk.com.