Smart small business owners understand the value of repeat customers—who, research shows, spend 67 percent more than other customers. What’s more, it costs five times more to acquire a new customer than to keep a current one.
To earn more repeat visits, you need to build better, stronger customer relationships. And how do we begin to build relationships? By getting to know people—and we don’t just mean recognizing their faces and remembering their first names.
You need to learn everything you can about your customers, their spending habits, and how they interact with your store—from the first time they read your online reviews, through the purchase experience, to the loyalty texts or marketing emails you send them to make sure they’re satisfied.
Let’s go over the key steps toward improving your customer list and building better loyalty.
Identifying who your customers ACTUALLY are
First, in order to use customer data to create stronger customer loyalty, you actually need to HAVE customer data, and the sad fact is, very few small businesses actually know who their customers are, other than a few regulars.
Many small business owners believe they have a good bead on what types of people spend money at their stores. However, often times they find, once they are presented with actual data, their customer base is widely more varied, or even comprised primarily of another group entirely.
Here’s one example of a Womply small business customer who was surprised to learn that her customer base was significantly different from what she had assumed, and this data helped her grow her business in new and profound ways.
So rather than getting wedded to the idea of who you think your customers are, start working to determine who they actually are.
For example, you might assume your customers are mostly older married couples, but you could be ignoring the large number of younger, single people who are actually adding significantly to your business’s bottom line.
Or you might be confident that it’s your “core base” of repeat customers that are the most valuable to your business, when in actuality your make far more money from first-time (and even one-time) purchasers.
With more detailed (and correct) customer data, you can develop and distribute more effective marketing campaigns to build customer loyalty and exceptionally valuable repeat business.
So now that we’ve discussed how valuable correct customer data is… how to you actually get it?
Transaction data is the gold standard for building customer loyalty
Today, outside of the rare, holdout “cash only” car detailer or roadside pie stand, pretty much every successful local business needs to accept credit and debit cards. Research shows that nearly all small businesses see a significant boost in revenue when they start accepting these more “modern” types of payments, despite the fees charged by the credit card issuers and processing companies.
And while this increase in revenue is absolutely desirable and valuable, what can be even more impactful on small businesses is the customer data associated with these digital transactions, as long as you have the right software to collate, organize, and exploit it.
For example, transaction data is one of the most accurate and effective ways to fuel customer relationship management (CRM) software.
Are your customers mostly regulars who spend relatively little each visit? Or do they come in once a year but spend hundreds or thousands? Which customers should you target with your loyalty marketing efforts? The only way to get these valuable insights is with the right software that can gather and interpret all of your transaction data.
You can guess and speculate and posit about who your customers are and how they spend with you, but nothing is quite as accurate as cold, hard transaction data, telling you exactly how customers spend, how much they spend, and when they spend.
In combination with the latest small business software, digital transaction data (from credit and debit card purchases) gives you the most correct and up-to-date view of your customer interactions.
Accurate customer data stretches your marketing dollar
Once you have a handle on who your customers are, how they spend, and what types of offers they may be interested in, you can engage far more effective marketing campaigns, including timely reminders, birthday promos, special sale items, loyalty programs, and other incentives that will be more likely to convince your customers to come back and spend with you again and again.
With the right small business software solutions that integrate seamlessly with your payment processing service, you can create better customer relationships, attract more new customers, and increase loyalty with existing customers—all without spending time you don’t have.
- The 6 elements of an effective loyalty program
- 3 creative ways to start a customer loyalty program
- The small business marketing success guide
Go beyond “gut feelings” with business insights informed by transaction data
Transaction data is useful in more ways than customer relationship management and loyalty efforts. It can enable real-time business analytics to help you make smarter business decisions more quickly.
For example, do you actually know how you compare against your local competition? Do you have a true view into what your revenue trends look like on a yearly, monthly, weekly and daily basis?
Do you know when your best sales periods are, and which need more support? (Not “gut feelings”… do you actually know?)
Without transaction data and the software to organize and interpret it, the answers to all of these crucial business questions are simply guesses.
Some payments processors include basic business analytics tools with their platforms, and these can be useful. However, many successful small business owners opt to purchase dedicated software that permits broader-view benchmarking against their local competitors, historical data and more.
Womply’s business intelligence software, built from the ground up for small businesses, combined with Womply’s unique CRM functionality, can help transform your customer loyalty efforts and help you drive business and revenue growth. Click for a free demo, or fill out the form below.