Bernard May is the CEO of National Positions, a 5-time Inc. 500 company, award-winning marketing agency and Google Premier Partner.
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When marketers and business professionals discuss marketing strategies, the subject of the almighty marketing funnel and corresponding budget allocation inevitably makes its way into the conversation. After 20 years in the business, I’ve been part of this dialogue more times than I can count.
Most of the time, these discussions center around the various marketing channels: How much should we spend on Google Ads, social media, web design, promotional messaging, etc.? And many assume that the acquisition of new customers is the answer when, in actuality, I’ve learned that repeat customers hold the power to sustain a brand in the long run.
Here are a few things about returning customers I take into consideration that I hope, by the end of this article, you will too:
• On average, DTC and retail brands note about a 60% rise in new customer acquisition costs, but 81% of customers will consider purchasing again if they get great service from day one.
• Your loyal existing customers have a 67% higher average order value than new customers.
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• The chance of converting an existing customer is 60%-70% as opposed to the 5%-20% chance with new customers.
• In the United States, over 80% of customers are loyal to at least one brand.
So, while it’s true that you will always need new customers, it’s time to uncover some of my favorite ways to nurture those existing customers you already spent time, money and effort to acquire.
Email Nurturing
It has been said that for every dollar spent on email marketing, businesses see an ROI of anywhere between $36 and $42 (depending on the source), and that’s nothing to sneer at! One thing that makes email nurturing so enticing is you are using existing customer contact information by default, so your biggest investment is time, not cash. Here are a few ideas beyond the tried-and-true abandoned cart and welcome emails we all know about:
• Automated post-purchase promotion: Since you need to send a confirmation email when a new customer makes that first purchase, why not include a promo code for their next purchase? Sending a quick “thank you” email with a discount is a welcome way to gain repeat customers fast. For example, “Thank you for your purchase. Use code MORE20 for $20 OFF your next order!”
• Purchase history email: Create custom email promotions for customer purchasing types, including seasonal customers, monthly subscription purchasers or even a complimentary product offer based on past purchases. Customizing to the taste of your customers shows them this promotion is specifically for them and not a spammy blanket email. For example, “Fall is here! Do you need more candles to keep your home glowing this season? Receive 20% OFF your entire purchase!”
• Customer anniversary email: Consider sending a promotional code (or free gift) to celebrate the anniversary of a customer’s first purchase, or commemorate your brand’s anniversary with a discount. An email corresponding to a specific date can drive a greater connection or affinity to your brand. For example, “We are celebrating 15 years and want to share this exciting benchmark with you! Use code FIFTEEN at checkout and receive a free tote bag!”
Loyalty Club SMS
What is more personal than a direct message sent to your mobile device? This strategy can be powerful, but there is a fine line between powerful and intrusive. Assuming you’re not going to be blasting out promotional texts daily, let’s look at a few ways you can nurture your customers using SMS.
It’s important to note that there are specific “opt-in” requirements that customers must be made aware of prior to sending that text. In short, customers must be notified that by providing their phone number (common with loyalty programs), they are providing consent to being notified about business-related promotions.
With that out of the way, here are some of my favorite SMS tactics:
• Special event promotions: Holiday weekends like Memorial Day or Labor Day are prime times for a promotion or sale. Sending out an SMS to your customers about your “40% off storewide sale that is this weekend only” promotion might light a fire and entice customers to head on over to your retail or digital storefront.
• Holiday season countdown: We all know that the months leading up to the holiday season are crucial and that a flood of purchase activity is on the horizon. Use SMS to promote a set of weekly deals as the clock ticks down. This not only gives customers something to look forward to, but as the weeks tick by, they are even more likely to be waiting for what you have to offer next. Keep them on the edge of their seats!
• Birthday SMS giveaway: Nobody likes to be forgotten on their birthday. So, send your customers an offer for a free gift, free shipping code or even simply a “Hope you have an amazing birthday” SMS message. This one is simple, personal and lets your customers know that they are top of mind to your brand.
Retargeting Campaigns
Retargeting needs no introduction. But, essentially, you are allocating part of your paid media budget (Google, Facebook Ads, etc.) to target those who have previously interacted with your brand. You are focusing on connecting with “warmer” prospects or even enticing customers to come back for more.
For example, marketers have seen conversion rates of over 60% from those opting into personalized ads and 54% have seen increased engagement with this personalized approach. So, there is no reason not to give this strategy a second look. Plus, retargeting is typically more cost-effective than “first-touch” paid media ads.
So, as you consider how to keep ROI high and LTV (lifetime value) growing, consider the built-in value of your current customer base. No business can count on (or afford) to rely solely on a consistent influx of new customers, but you can make the most out of the customers you have already worked so hard to gain. You already hooked them once—why not spend a little time reeling them back in?
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Author: Bernard May, Forbes Councils Member
