How to Balance Attracting New Customers and Retaining Loyal Ones
Overview: In today’s competitive landscape, brands can’t miss an opportunity to convert prospects or encourage past shoppers to buy again. The stakes are high for advertisers to strategically entice consumers and carry them along the path to purchase.
While every brand strives to attract new customers and raise brand awareness in their respective industry, marketers can’t forgo opportunities to make past shoppers into repeat buyers. Given that, as a general rule, 80% of business comes from 20% of customers, encouraging repeat business presents a major sales opportunity.
However, winning repeat business is oftentimes easier said than done. With an abundance of choice, today’s consumers are more open to trying new brands and products (and from new channels), instead of sticking with ones they’ve bought before. This disloyalty means that today’s brands need to work smarter to retain the business of customers who have previously bought from them—while also seizing the opportunity to persuade those who have yet to.
Here’s how advertisers can entice existing and new consumers and contribute to the bottom line.
Differentiate messaging between audiences
Today’s customers want to be feel appreciated by the brands they frequent, rather than anonymous targets being sold to. But without the ability to identify unique shopper trends and preferences, advertisers are left to generalize promotions that speak to broader sets of consumers—consequently making advertisers’ efforts less effective on all of them.
Existing customers and prospects have different levels of familiarity with a brand and their offerings. Therefore, advertisers can’t expect that using the same messaging and campaigns for both groups to be particularly influential to either. Instead, advertisers need to build separate, tailored campaigns for each audience, which means they’ll first need a way to differentiate these key groups. In order to successfully silo campaigns by demographic, advertisers need to secure granular data encompassing both breadth and depth so that they can better understand a consumer’s relationship with a given brand. Using a robust analytics program that can perceive audience behaviors, advertisers can more informedly devise promotions that matter to consumers’ current wants and needs.
The ability to segment customers is particularly important for advertisers working with tightened budgets in the shadow of the pandemic, as advertisers will be able to target those high value, repeat buyers whose business will yield a stronger ROI and position themselves as top of mind to them.
Action tech-enabled promotions
With today’s consumers shopping online more than ever, the expectation follows that brands will deliver money-saving offers virtually—as opposed to paper coupons or mailers—to consumers’ devices.Because when using a digital device, consumers are only a few clicks away from acting on the offers they receive, this shifting preference presents an opportunity for advertisers to gain strategic consumer insights, as they can use technology to understand how shoppers respond to particular campaigns.
Given that, according to Nielsen research, 67% of trade promotions—equal to $400 billion—are wasted or barely break even, there currently exists a disconnect between the offers brands are putting out and what customers want. To avoid such missteps, which can result in major wasted spend on the part of brands, advertisers can again use an analytics platform to follow the trail of data created by consumers’ interactions with given promotions. This data can then be used to inform future offers and get closer to delivering on consumer expectations.
Make it easy to increase purchase size
Once advertisers attract consumers to their brand’s website, that website needs to encourage shoppers to make the biggest sale possible.
To increase purchases sizes, websites should offer product recommendations based on the consumer’s browsing or order history for them to add directly to cart. These recommendations affirm a brand’s commitment to deliver a seemingly personalized experience for each shopper, increasing their affinity towards the brand further. For this tactic to succeed, brands need to allow consumers to add the suggested products directly to their carts without having to go back through the website, as straightforward “Add to Your Cart” executions have been shown to drive 40% conversion (versus only 10% with traditional .com executions), according to our research. As with every component of brands’ websites, user friendliness is essential for increasing conversions; after all, competitors’ websites are only a click away.
Balancing past consumers and prospects can be a tough act, but advertisers shouldn’t resolve to deploying blanket campaigns that’ll inevitably leave all demographics feeling misunderstood. With the right data and strategies for actioning it, advertisers can acutely target consumers regardless of their relationship to the brand and persuade those individuals to keep purchasing time after time.