It costs up to ten times more to obtain a new customer than having an existing customer buy from you again. Yet thousands of businesses continually invest most of their advertising and marketing dollars to get new customers.
It might be an exciting exercise for you to count the number of customers you have, the average amount they spend with you and the number of times a year they do that. Then, increase the last number by ten or twenty percent, recalculate the balance and see what the numbers on your bottom line now look like. It should be Impressive!
If the impact of a few more sales can be substantial for you, shouldn’t you be doing more to encourage it? The following are ways you might have your customers purchasing from you, not once more, but many times, to experience the increases yourself.
Customer-Loyalty Programmes
The first concept is a customer-loyalty programme. As businesses have recognised that building relationships with customers is paramount to success in the last few years, these programmes are becoming more evident.
Each time a customer purchases from you, they are rewarded with points or loyalty dollars or an equivalent. Once a customer reaches a certain level of points or dollars, they may redeem them for a range of rewards, such as free products or services, products or services at a reduced cost, or prizes.
The leaders in this area are probably the airlines, with their frequent flier programmes. Travellers receive points each time they travel, and these can be redeemed for free travel, upgrades, hotel accommodation or gifts.
Some credit-card companies have formed relationships with the airlines and now give frequent flier points for each customer's dollar. As a result, some other businesses following suit include fashion boutiques, department stores, restaurants, hairdressers and video stores.
Groups of businesses have also joined forces to cash in on this successful strategy. For example, the Coles Group in Australia, along with more than twenty partners, has established a loyalty program via the ‘ concept.
Each time a customer purchases a product or service from one of the companies in the alliance, they accrue points which can be redeemed for money off purchases at Coles Supermarkets, Kmart, and Target stores, as well as vacations and household goods.
The good news is that you do not have to be a multinational to cash in on the concept of customer-loyalty programmes. The programmes can be simple and can substantially boost the number of times your customers visit or buy from you.
It would help if you also used customer-loyalty programmes to measure how often customers buy and target those who have not bought from you for some time to capitalise even further. Then, please write to the customers in that category periodically, letting them know that they have not been in for a while and perhaps make them a special offer to come back in to kick-start their programme again.
Creating offers for existing clients
The most accessible people to get ‘through your door’ are the customers who have purchased from you before. Creating offers that appeal to them makes it easy for them to find an excuse to deal with you again.
Look at your customer base or targeted customers, and try to establish what presses their hot buttons. Then find something that you can offer to them when they make additional purchases from you.
For example, if you are a sporting-goods company, the chances are that your customers are into things like basketball, football, golf, and tennis. Your existing customer base and your notes on their purchasing habits will give you an indication of what their interests are and what offers will most likely appeal to them.
If they make purchases during a particular week, you might like to contact your customers to offer tickets to a basketball game or a football game. If the cost is prohibitive, you could run a competition where customers are entered into a prize draw for one or two outstanding prizes. Grand finale tickets, exhibition games, matches, and products, or posters autographed by sporting legends, make great prizes. Do not limit your thinking to creating offers involving your product or service. Many businesses do not have products or services that would be appealing as prizes to their customers. If, for example, you are a manufacturer and you are selling to wholesalers or retailers, look at what your customers might be interested in. Are they primarily men or women in decision-making positions? What are their approximate ages, lifestyles, and interests? Then find a product or service that appeals to them.
If you are selling to mostly women, offer them a day of pampering at a beauty salon or their choice of a weekend away at a nice resort. If it is men, try sporting goods or events, a Ferrari for a weekend or a case of top-quality wines. If younger people make up your customer base, tempt them with paragliding or white-water rafting experiences, tickets to a concert, or books of movie passes.
A builder’s equipment hire business in Sydney has a list of giveaways with gifts like the use of a Bufori vintage car for the weekend, a hot-air balloon ride, sporting equipment, wines, weekends away, and other adventures to give customers who hired more than a certain number of times a month.
Because you cannot know what everybody would like, you need to offer your customers a choice. Put together a list of things they could win if they purchase from your business, and let them choose their rewards.
You might like to try a special birthday offer for your clients. Just before their birthdays, give them a ‘because it special offer, one not usually available, to get them to buy. It may be a discount on your product or service or a special little gift they get when they purchase.
There are limitless ideas for making offers to your clients. Think about things like:
- Rainy day sales. Make it known that customers will get an additional 5% off their purchases on any day that it rains. Great for those quiet days.
- Product-of-the-week This one is great for always keeping something different happening in your store.
- ‘If your name starts with’ Give discounts or special offers for customers with names starting with a selected letter. Pick a different letter each week or month and let your customers know what the letter is around 1–2 weeks in advance.
- Trade in your lottery ticket sale. Let customers know that unsuccessful lottery tickets are worth something at your store. From time to time, make the offer for customers to bring these tickets in for a discount on your product or service.
Think outside the square. Remember, the point of these offers is to bring customers back more often than they usually come, so make sure that your offer does that.
Closed-door sale
This concept can work well and give you an excellent return for only one day's effort.
The idea is to invite the customers on your database to a special showing, launch, preview, test, or sale of a product or service. Make the event seem exclusive.
Hold it after-hours and stress to customers that it is entry by invitation only (of course, give them a second invitation for a friend). Let them know that by coming along, they will be able to see, try and purchase products or services either not available to others or not available at that price.
You might like to hold a closed-door sale promoting:
- New products
- Discounted products (to get rid of them)
- Everything at 10% off
- Two-for-the-price-of-one
- Gift-with-purchase offers
- Buy-two-get-one-free
Remember to make it exclusive and unique. If customers think that they can get this deal at any time, they will have no incentive to come to your store at a particular time. Try some gimmicks like blacking out the windows, having it catered, or having some entertainment. Of course, these ideas depend on your probable sale proceeds, margins, and costs of holding the event. If you are selling $1.00 items, you will have to sell a lot to cover your expenses, so maybe go easy on the entertainment if that is the case.
Do not think this concept cannot apply to you because you do not have a retail store. It can. If you are a builder, have a preview night of some of the latest designs, materials, and projects available. Give the customers an offer, say a complimentary garden setting or, if the projects are of higher value, something like a spa (which you can pass on at cost, although the customer will see the value at retail price).
Attracting attention to yourself
Another great way of getting people into your business is to hook up with someone in the public eye. If applicable, book a sporting hero or a well-known personality to make an appearance at your business. They may be able to give away autographs, posters or books, or even small novelties. Hire a clown for the kids or the latest popular movie or cartoon character.
Some coffee shops have free psychic readings for all patrons on a specific day of the week. Please have a look at them; they are full on the days they do it. If that is not up to your alley, try a caricaturist, a magician, a mind reader, or a balloon sculptor.
Make sure that the local papers and radio stations know all about it, invite them along, and you should get lots of press coverage. Of course, make sure you do this before the event, so you can capitalise on it. You (or they) might also like to donate some of the proceeds to a charity, local organisation, or school, and that will also give you good publicity.
If your business is more serious, you can still get mileage out of this concept. Remember, it does not have to be something linked directly to your product or service. For example, if you are a financial-services business, you could book a well-known authority to talk on a particular subject to make money or invest.
Why keeping in touch is crucial!
Just keeping your name in front of your customers will result in more sales for you, and it also allows you to promote more of your products or services to encourage them to buy more often.
If you have established a buying circle, use this information to market your offers to your customers between their probable buying items.
Newsletters
An excellent way to keep in touch with your customers is through newsletters, and businesses that do this well have a much better relationship with their customers.
The newsletters do not need to be Gone with the Wind or literary masterpieces, and they do not need to be expensive to produce. If you have or know someone with a computer, some good software, and a laser printer, you can probably get it done ‘in-house’. Not you, however; you will be too busy managing all the other marketing initiatives. You will, however, be responsible for the design of it and making sure that it is geared to a response; that is, at least more inquiries if not more sales.
Creating Advocates
The more excitement you create about your business, the more business you will have. Therefore, you should use every opportunity to get more people introduced to your business.
With all of the concepts outlined above, you should be aware that there is an opportunity to leverage your marketing and also introduce new customers to what you do. But, of course, the people who can do this for you are your existing customers.
Ask your customers to include their friends in your promotions. For example, when you invite customers to a closed-door sale, also include an invitation for them to bring a friend.
If you have an ‘if your name begins with’ day, let them know that they can bring friends or know of next week's promotion if any of their friends qualify.
Please do not limit your promotion to your clients, although it is the best place to start. Instead, look for every opportunity to work in the three areas of business growth. Indeed, each concept lends itself well to one area over another, but with a little creative thought and adaptation, you can capitalise on its investment by obtaining benefits in the other areas.
Working your peaks and troughs
Marketing your business is essential and something you should constantly be working at. Successful businesses never ‘drop the ball’ in this area – there is always something going on.
However, when planning your marketing activities, consider that there are peaks and troughs in trading that you should be looking to fill.
For example, if you are a pool builder, promote solar heating installations just before winter. Also, look at marketing pools at that time, and let your customers know that they will have their pool ready for summer if they purchase now.
If you own a garden-care business, you will realise that your work drops off in winter. At the end of summer, you might like to promote a yearly package service, where for a certain amount each month, customers will have a certain number of visits per year.
Marketing is also about timing. In this situation, both you and the customer are winning. The customer gets to even out the expense, and you get to boost your cash flow during the slower months.
Whatever business you are in, measure when your peaks and troughs occur. Your peaks will usually be when your business is going smoothly, so really get stuck into your marketing efforts just before the troughs. So here is your checklist of things to do:
Develop a Customer-Loyalty Programme
- How will it work?
- How will we implement it?
- How will we promote it?
- What will we measure through it, and how?
- What information will that give us, and how will we use it to market further?
- Special offers we will promote the offer by:
- The targeted result of this offer is:
- We will measure it by:
Closed-Door Sales
- We can have these to promote:
- The plan for this sale is:
- We will promote it by:
- The targeted result for this sale is:
- We will measure it by:
- Keeping in touch can get publicity by:
- Organisations we will talk to are:
- Our timetable is:
- We will stay in touch with clients by:
Peaks and troughs
- Ours are:
- We will fill the low spots by:

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Information contained in this document constitutes general comments only for the purposes of education, and is not intended to constitute or convey specific advice. Clients should not act solely on the basis of the material contained in this document. Also, be aware that changes in relevant legislation may occur following publication of this document. Therefore, we recommend that formal advice be obtained before taking any action on matters covered by this document. This document is issued as a guide for clients only, and for their private information. Therefore, it should be regarded as confidential, and should not be made available to any other person without our prior written approval.