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Study finds shift from acquisition to engagement
There is a shift occurring in the small business space: that of acquisition to engagement. According to new data out from Manta and BIA/Kelsey Group, SMBs are spending more to engage existing customers than to bring new customers into their business - because repeat customers are spending more with them.
"Our joint research shows that customer loyalty programs are starting to gain traction in the small business community," said Jed Williams, BIA/Kelsey's vice president of strategic consulting. "This finding aligns with BIA/Kelsey's analysis that over half of small businesses will launch customer loyalty programs by the end of 2014 to help their businesses become more competitive."
Some interesting takeaways from the report include:
• Half of SMBs rely on paper-based or WOM loyalty programs
• 66% of SMBs don't have a loyalty program
• 61% say half their revenue is from repeat customers
• Repeat customers spend 67% more than first-time buyers
What can SMBs do to better engage existing customers? Build a good loyalty/rewards program, say the experts. Offering percentage off deals or rewarding members for making purchases will keep them coming back - the key, of course, is to build a loyalty program that fits the customer.
Manta's experts say determining the audience and building a program around specific groups within that audience is one way to not only drive traffic but purchases because you're rewarding their behavior. The next step is to define the goals of the overall program, and don't make the goal to make more money because that is too broad. Create goals like increasing order size or decreasing customer churn so that you can have a specific strategy in place.
Image via Shutterstock
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