5 reasons why repeat customers are important to your businessBy Amirul Mokhtar · 2nd August, 2016
A person who buys from you once is a customer. When this customer comes back and makes a purchase from you a second time, he/she is a returning customer. And if that person comes back over and over again to buy from you, then he/she is a repeat customer. Many Ecommerce Entrepreneurs are still not convinced on the value of a repeat customer and pour most of their resources on strategies that will bring in new customers but not get them back to purchase again. A great example is putting all their eggs in an online marketplace. Yes, you get great exposure for your products but the chance of them buying from you again is very small due to the high competitive environment. Repeat customers are the key to a profitable business. In this post, we will look at the 5 reasons why they are.
#1 It costs lessYou’ve heard it over and over again. It’s cheaper to get past customers to purchase again than it is to find new customers. This is especially true in the crowded online business arena where ad impressions, clicks and conversions always seem to be increasing in cost. It can get up to 10 times more expensive to bring in new customers. Putting some marketing focus on existing customers will lead to a better return on marketing investment. This is because once a customer has bought from you, that person requires a lot less convincing to come back to your store and shop again.
#2 They help promote your businessThe most effective kind of marketing is word of mouth. Repeat customers are happy customers and happy customers will tell 4 to 6 other people about their experience, without much effort from your end. It’s like free marketing! And It is very effective because they are hearing it from someone they trust. If you really care for your existing customers, you can gain another level of advocacy. Not only will they help promote your business, but they will also back you up when people say negative things about your business.
#3 Increase number of transactionsAs mentioned earlier, they don’t need much convincing to purchase from you a second time, a third time, and so on. Having repeat customers will increase your business profits because they buy from you more times and they spend more compared to customers who only have bought once. Bain & Co. studied the online shopping habits of 522 users and found that in the apparel category, a given shopper’s fifth purchase was 40 percent larger than his or her first purchase, and the 10th purchase was a whopping 80 percent larger in value than his or her first one. So, get a customer to stay longer with you and they will tend to spend more.
#4 Help with product expansionDo you plan on introducing new products? According to Kotler, a great way to grow your business is to find more products that can be sold to the same customers. Cross-selling works better with existing customers because a relationship has already been established so they will be more open to new products by your business. Reaching out to them can be as easy as sending a newsletter of your new products. Even better yet, get them to sign up to an exclusive list where they can be the first to find out about new products from your business. Read: How to build an email list for your online store
#5 Gain better understanding of your target marketInformation about demographics, buyer behaviors, and interests are all valuable information you need to grow your business. These information help you find your customers and help to better satisfy your target market. Instead of going through the trouble of doing market research, you can get these information straight from your existing customers. EasyStore helps you on this by providing you with the necessary tools to better understand who your customers are and what are their behavior. Your customers’ information are all recorded in the customer management system and you can keep track of their purchases with you. This is a great tool to identify your potential repeat customers. EasyStore’s integration with Google Analytics, Hotjar, and Crazyegg lets you know exactly who is doing what when they visit your online store. (more tools in Apps Store) Send out a simple survey email to your whole customer database with the help of email marketing tools and get direct feedback from your customers. Use those feedbacks to satisfy more new customers and turn them into repeat customers. Now you know how valuable your existing customers are. Especially, getting them to come back and buying from your store over and over again. Hope you are convinced and start focusing on building loyalty towards your brand and your business.
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