While a lot can be said about how to optimize your website to turn visitors into customers, the fact is that the most valuable sales you get are going to come from your existing customer base.
Acquiring new customers is important, but they are never going to be the driving force behind your bottom line in the same way that your loyal, devoted customers can.
Pull quote: Loyal customers make more purchases and spend more on those purchases than first-time shoppers
When you’ve locked customers into your brand and turned them into loyal advocates, you start to become as valuable to them as they are to you. There are a few key reasons why this is so, so let’s take a look at the top 3 areas why investing in re-converting your existing customers is good for your brand’s growth.
Existing Customers Know Your Brand Values
Every brand has a story, and the brands that are the most memorable and go the furthest are the ones that have a story. Those stories then drive the values that the brand embodies, and those are the values that make them so appealing to their large customer bases.
Think of the world-class brands you admire: Patagonia, Apple, Starbucks. They stand for something, whether it’s to “think different” or “to inspire and nurture the human spirit – one person, one cup and one neighborhood at a time.” No matter what type of business you run, you can make your brand’s values front and center so that when customers buy your products, they aren’t merely purchasing goods, but buying into the values that your brand represents.
First-time shoppers then have to be convinced that the values your brand emulates are values that they want to be associated with. After they have already made a purchase, they’ve already aligned themselves with you, making it that much easier to re-convert them.
The hard work is already done.
Existing Customers Know Your Brand’s Value
Of course, every purchase has a product or service at the center of it – there can’t be a transaction without one. One of the other challenges with first-time customers is that they don’t truly know what the value of what you’re selling yet.
You may have great social proof, the most powerful decision drivers, but until they get their own hands on your products for themselves the level of trust is never going to be complete. This is especially true for luxury brands, where it’s harder to know if the purchase will be worth the sticker price.
Pull quote: “A repeat customer is more than 20 times more likely to convert compared to a first time visitor” – Paul Ferris (Marketing Metrics)
Once they’ve made a purchase, they can experience the value of your brand for themself, and won’t have to rely on product reviews, testimonials, or user generated content to try and figure out if your brand provides value. They will know it themselves and will use that knowledge to make the path to a second purchase even easier.
Plus, with each additional purchase, they become even more likely to come back. The average ecommerce store has a conversion rate of roughly 1-3%, meanwhile, in his book Marketing Metrics, Paul Ferris describes how a returning customer has a 60-70% chance of converting. If that isn’t proof that loyal customers know the value of a brand, I don’t know what will.
Existing Customers Value Your Brand
The last of the three key reasons why its so worthwhile to re-convert your existing customers is that they value your brand, which is, in essence, a combination of the first two points.
Customers that know what your brand values, and know the value of your brand, can be empowered to not just know that your brand is worth the second, third, and fourth purchase, but to use their alignment with who you are and what you do to bring you even more customers.
A loyalty program that rewards both the sender and receiver of a referral motivates the trusted, word of mouth marketing that turns simply existing customers into truly devoted brand advocates. On top of that, the science behind the rule of reciprocity, developed by Dr. Robert Cialdini shows that because if the value you’ve provided your customers, they feel obligated to give you value back (even though they paid for the goods) by letting other people know how valuable it is.
When you’ve padded the referral with a reward, it then becomes even more of a no brainer for them to tell everyone they can about the value of your brand.
Your Existing Customers are Your Best Asset
No matter what way you look at it, the customers that you’ve already converted are the ones that you should be investing your time and efforts into. They can bolster the reputation of your brand by telling people about how valuable it is, as well as make more and more valuable purchases themselves the longer they remain a customer.