It costs up to five times more to acquire a new customer than to retain an existing one.
1. Retain more customers
67 % of customers adjust their spending habits to a loyalty program , which means your customers will not only be one time customers they will come back to redeem their loyalty points .
2. Customers purchase frequency will increase
Not only will customers come back , they will also come back in a quicker turnaround time . They will not just visit your shop again but they will come back more frequently.
" Numerous academic studies on loyalty programs found that if you provide your customers with a head start with some free stamps or points, they will be more engaged with your loyalty program and complete their card faster than if you provide them with a blank loyalty card "
This is known as the “endowed progress effect” .
3. Increase customers’ average order value
Typically, consumers spend more when they belong to a loyalty program.
According to the 2016 Bond Loyalty Report, 66% of consumers modify the amount they spend to maximize points. On the one hand, loyalty members buy more often and spend more than non-loyalty members, resulting in a 5-10% revenue increase.
4. Increase customers lifetime value
The way to increase customer lifetime value is inherently simple: Give customers a reason to spend more. This is where loyalty programs come in to help. Customer loyalty and lifetime value go hand in hand. Your most valuable, loyal customers are the ones who spend the most money, over the longest span of time.
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