Marketing Budgets Down? 5 Ways to Increase Revenue from Existing Customers
In this blog, we will focus on how to increase revenue from existing customers. This becomes all the more important keeping the ongoing pandemic into consideration…
In today’s seemingly apocalyptic days, many businesses are struggling to remain viable. COVID-19 and enforced social distancing have created a massive strain on the global economy. As for any economical chaos, there are those who suffer from the disaster and those who find opportunities to leverage.
For many businesses, marketing budgets are down, while other brands are spending more and more on marketing efforts. However, you don’t have a huge marketing budget to continue generating revenue from existing customers.
In this article, you will learn about the impact of COVID-19 on marketing, and what you can do to increase revenue from existing customers. You will also learn from case studies, which review the customer loyalty efforts of two big brands.
The Impact of COVID-19 on Marketing
According to a survey by Influencer MarketingHub, the majority of brand respondents reported that they expect to decrease or have already cut down on marketing efforts due to COVID-19.
It’s not all hopeless. However, according to research by Klaviyo, around 22% of brands are actually increasing spending. These brands are making the most of the current market by highlighting ‘essential’ products and creating COVID-19 appropriate campaigns.
Of those industries struggling, luxury and travel-related brands, and politics are some of the hardest hit. In contrast, brands devoted to news, mental and physical health, basic needs, and technology seem to be doing well and even thriving.
The Importance of Marketing to Existing Customers
If you are one of the organizations decreasing your marketing budget during this crisis, you’re probably looking for ways to maximize the output from what’s left. Focusing on marketing to your existing customers can be a viable option. When you spotlight and acknowledge existing customers you can:
Increase retention rates—reminding customers that they are valued and remembered helps boost your customer relationships and reminds them of positive past interactions.
Boost product spending—engaged customers are more likely to make purchases and are more likely to spend more per purchase. Additionally, existing customers are easily identifiable, allowing you to restrict resources spending to those who are already interested.
Leverage social marketing—existing customers can help you generate new contacts and provide organic marketing. Reaching out to these customers can help you take advantage of these benefits while improving individual relationships.
How to Increase Revenue from Existing Customers
To ensure the greatest ROI for your efforts, you need to focus on strengthening your relationship with customers and increasing brand loyalty. Below are a few methods you can use to achieve these goals.
1. Start a customer loyalty program
Loyalty programs can help you individually reward customers for engagement and increase purchase frequency. While you may not feel you’re in a position to give discounts as rewards, there are many other benefits you can offer. For example, providing first access to new products or including “insider tips” in your communications.
It can be particularly useful to gamify programs. For example, issuing social media challenges or displaying progress bars on loyalty apps. In fact, according to contest statistics, they have a conversion rate of almost 34%, which is higher than other content types.
Additionally, awarding social media badges or honorific titles can make loyalty programs fun without costing you anything. For example, Sephora, a cosmetics retailer, offers the Beauty Insider program with rewards tied to a customer’s tiered status. In this program, members can “level up” based on their spending.
2. Onboarding program
Onboarding programs devote extra care and attention to your new customers. These programs help ensure that customers are able to quickly feel comfortable with your service or product and can have a significant impact on developing customer relationships.
While these programs can be resource-intensive, there are methods you can use to reduce costs. For example, creating an onboarding package with pre-recorded tutorials or graphic walkthroughs. Chatbots and wizards can also be useful for guiding new customers as long as you also offer an option for live interaction.
Have a look at how Heek, a website design tool, onboards its customer using a well-designed chatbot.
3. Communication calendar
Communications calendars are tools you can use to track customer communications and engagement. These calendars can be used to trigger agents or scripts when customers haven’t engaged in a while. For example, sending an email asking if a customer still wants to receive newsletters even if they haven’t opened on in a while.
These calendars and the communications triggered can help you reduce customer churn and remind customers that you’re aware of them personally. These communications can also provide timely opportunities to offer customers rewards or cross-sells. For example, offering a free gift on a birthday or refill packs for a product that they’re about to run out of.
4. Improve your customer support
Similar to onboarding, focusing on improving customer support can help you both secure and retain customers. Providing strong support from the start shows a dedication to customer outcomes and displays pride in your product or service. It can also be a valuable source of customer feedback.
While support can mean having dedicated, live agents, it doesn’t have to. You can also start building a solid support base by making sure that your product documentation is clear. For example, making a publicly available wiki that is searchable by topic. Creating blog posts with functional tips and tutorials is also a good place to start.
The Freshchat live chat offers a seamless customer experience with the help of increased personalization and recommendation.
5. Company newsletter
Company newsletters are a good way of periodically reminding customers that you exist and what you’re up to. These tools can help you advertise new products, highlight upcoming events, or provide interesting and engaging information to customers.
Newsletters can also be a fun way to encourage community interactions through included polls or challenges. These methods can keep customer attention a little longer and if crafted carefully can lead to free marketing. For example, a quiz that rewards customers with an Instagram-worthy graphic.
Learning From the Best: Customer Loyalty Case Studies
If you’re still not sure that focusing your current attention on your existing customers is worth it, consider the following examples.
Starbucks’ customer loyalty program
Starbucks, a global cafe chain, has a well known and used loyalty program. At first, this program rewarded all members equally. It grants points each time a member visited the chain, in addition to a variety of other benefits including free in-store refills and birthday rewards.
However, a few years ago, the company revised the program to provide higher rewards to higher spenders. As a result, many customers who were previously not using the program downloaded the loyalty app and even preloaded an account balance. In addition to this, Starbucks gained the added benefit of collecting valuable data from more customers.
Annmarie Gianni Skin Care rewards
Massive chains aren’t the only ones, benefitting from customer loyalty, however. Smaller businesses can also take advantage of the same.
For example, Annmarie Gianni, a small skincare and beauty products brand. This company used social media quizzes tied to special product offers to engage customers. The quiz gamified the customer interaction and the offers (including a specially priced sample kit, free shipping, a $10-promo code for the next purchase, and a free ebook) encouraged purchasing.
While this did cost the company a small amount to organize, the payoff was well worth it. From this effort alone, they managed to generate over 20k leads and $200k in just two months.
Marketing creates a connection between brands and customers. Your marketing efforts help inform your customers about new offerings, and ensure that existing customers are continuously engaged with your brand. To be effective, you don’t need a huge marketing budget. What you need is consistency. Create a channel of communication that ensures existing customers stay engaged with your brand and keep your brand in mind when they need to make a purchase.
This article is written by Chen Shem Tov from Agile SEO. They provide strategic SEO solutions to technology brands.