You can probably name a few popular brands that have achieved a cult following of repeat customers.
While not every brand can be the Apple or Starbucks of their industry, any brand can become indispensable to their customers when they invest in their experience and prioritize the customer relationship. Put your customer first, and repeat sales are sure to follow.
Read on to find out 5 ways any brand can encourage repeat customers:
- Be helpful
- Create a memorable experience
- Give customers more choices
- Act on customer feedback
- Do something good in the world
What is a repeat customer?
Repeat customer and return customer are different but related terms.
- Return customer refers to someone who has made a purchase from your company once before and has come back to do so a second time.
- Repeat customer refers to someone who has purchased from your brand time and time again and is considered a loyal customer.
How do you identify a repeat customer?
Customer data enables a business to identify a repeat customer. For example, customer loyalty metrics such as customer lifetime value, customer retention rate, and repeat purchase rate.
To ensure a good customer experience, agents will need customer service technology that enables them to quickly identify a repeat customer when they reach out. Zendesk's customer service solution arms agents with relevant customer context, like a repeat customer's account type, contact information, or previous support questions.
After all, if a repeat customer has to repeat the same basic information each time they reach out to the business, they aren't going to remember the experience as a positive one.
Why repeat customers are important
We know that customer retention is cheaper than customer acquisition. In fact, a 5 percent increase in retention correlates with at least a 25 percent increase in profit according to Bain & Company.
- Repeat customers drive consistent revenue
True loyalty means customers are less likely to be swayed by competing offers or discounts, so you can feel more confident about money coming in.
- Repeat customers build stronger relationships
Repeat customers are often easier to sell to because they already have a relationship with you and feel more confident in your ability to deliver.
- Repeat customers result in word-of-mouth marketing
When you have a happy customer, they may recommend your product or service to friends or colleagues or talk it up on social media.
- Lifetime value
Repeat customers are likely to generate more value over their lifetime as they continue to try new offerings based on their relationship with your brand.
Repeat customers are an asset worth investing in, and these are a few reasons why:
Investing in retention strategies such as loyalty programs and good customer service can help you get the most value from your existing customers.
5 ways to gain repeat customers
Every company wants to have repeat customers. It's a strong indicator of brand health and success. But there's no shortcut to building a thriving customer base.
Here are a few ways you can win your customers' trust, respect, and hopefully, repeat business.
Research shows that nearly half of customers would switch to a competing company after just one bad customer service experience.
To keep customers happy, you need to help solve their problems and answer their questions—even the most unconventional ones.
Thrive Market, an online marketplace for organic and specialty food, once received a customer service request asking whether a particular brand of ghee was made under a full moon.
It wasn’t, but it turned out to be a lesson in good customer service.
“It’s a great example of how passionate our customers are and our desire to share and match that passion,” said Michael Shaughnessy, Thrive Market’s workforce management analyst.
Create a memorable experience
Brand recall is a top metric for marketers. It refers to the consumer’s ability to recognize and associate your products with your brand when they see your message.
Brands can cash in on recall by creating memorable experiences that set themselves apart, such as unique packaging, savvy social media posts or bold marketing campaigns.
In some cases, the novelty of the experience can be the very reason why your customers come back for more.
Johnny Cupcakes, “the world’s first T-shirt bakery,” is one example. The T-shirt retailer boasts a few fun customer loyalty stats, including more than 2,000 loyal customers who have the brand logo tattooed on their bodies.
Give customers more choices
It feels good to have options. Sephora, the beauty retail company that’s become a household name, disrupted the beauty industry by bringing multiple brands under one roof and giving customers the luxury of choice.
Now customers can choose everything from which free samples they receive to which rewards they redeem through their Beauty Insider rewards program.
Stitch Fix is another brand that is giving customers more choices. While they made a name for themselves selling stylist-curated clothing subscription boxes, they now give subscribers the option to supplement their boxes with a shopping experience that allows them to choose from a selection of clothes they can buy a la carte at any time.
The effort seems to have paid off, with Stitch Fix reporting a 9 percent increase in active clients year over year, despite COVID-19 challenges.
Act on customer feedback
If you want to encourage repeat buying, you need to have a customer feedback mechanism in place.
Customer satisfaction surveys are a good place to start, and many companies rely on a Voice of the Customer (VoC) program to glean insights from their existing customers. Acting on customer feedback shows your customers that you’re listening, and you truly care about their experience.
Here’s an example. Glofox, a startup that provides gym management software, pivoted their entire product roadmap to help customers who were struggling to transition to online fitness classes. They stopped everything they were doing and were able to develop this capability for their platform in about a month.
Listen to our conversation with Glofox on the Sit Down Startup podcast to find out how changing course earned them loyal customers for life (probably) and positioned the company for global expansion.
Do something good in the world
Increasingly, customers expect brands to take a stand on issues they care about. And yes, this affects customer behavior.
According to an Edelman study, two thirds of consumers buy based on beliefs. This means brands can no longer remain neutral, but you need to back up your values with action.
Donate to causes that align with your brand’s mission. Encourage employee volunteering in your community. Update internal policies so they reflect your values
For example, Starbucks recently announced that they will tie executive pay to diversity targets. Another example: In the lead up to the 2020 presidential election in the United States, more brands emphasized the importance of voting and some even offered reduced hours or paid time off for employees to vote.
The secret reason customers become repeat customers
At the end of the day, it's probably not discount codes or flashy stunts that will win your customers over and lead to a repeat purchase. It's the experience they had and how you made them feel that will make them a customer for life.
So when in doubt: Be kind, be helpful, and be human.