Although customer acquisition must remain at the heart of your marketing strategy, in particular when launching your offer, the challenge of developing customer loyalty takes top priority today. ZIQY, the ultimate subscription management platform, explain to you how subscription has established itself as an essential lever within your customer loyalty strategy today.
Customer Loyalty vs Acquisition
Gone are the times when customer acquisition was the marketing strategy buzzword. It has now given way to customer loyalty, new brand strategy challenge. And in order to achieve this, many resources are available to you today: analytics, user experience, subscription…
What does acquisition consist of?
It is a question of developing different types of operation in order to promote the launch of your offer onto the market and to make it known to the maximum number of target customers. Throughout this stage, it is essential that you precisely define your targets, your strongest selling points and your key components of differentiation. Depending on the subscription offer proposed and customer engagement towards your brand, you must plan to some extent a permanent acquisition strategy.
What does customer loyalty consist of?
Once the prospective customer has become a subscriber, you must not let them go over to your competitors or let them stop subscribing!
Indeed, the cost of subscriber retention is on average 3 to 30 times lower than the cost of customer loyalty. Building customer loyalty is therefore a genuine long term winning strategy. And this starts from the moment the first customers are convinced and satisfied by your subscription offer. Be inspired by the customer loyalty strategies of Deezer or Spotify or of Glossybox or Beautiful Box.
Why create loyal customers
Creating loyal customers is a particularly important step in building your brand longevity and effectively increasing your sales revenue.
Some figures concerning the development of customer loyalty:
● According to a study carried out by Bain & Cie, a 5% increase in the rate of retention of your best customers can generate between a 25 and 55% increase in your profits.
● It is 7 times more expensive to recruit a new customer than it is to sell to an already existing customer.
● 68% of customers leave a company because of a lack of communication according to a study by Sage France.
● 98% of dissatisfied customers never let you know, they just leave you according to P.Fisk of Customer Genius
Some advantages of developing customer loyalty
- Recurring revenue: admittedly, this recurrence is already an inherent part of the subscription business; but it is equally important to ensure that your subscribers remain loyal to you.
- Saving money: on the cost of customer acquisition or the management of your After-Sales Service for example
- Loyal customers buy more than others: one opportunity to create loyal subscribers is to establish a genuine market place around your offer as a second step. Take the example of Birchbox: initially a business box, the site today is a genuine e-commerce dedicated to beauty.
- Loyal customers become your brand ambassadors: and word of mouth remains the simplest and most effective means of recruiting new subscribers.
- Your loyal customers will play a part in the improvement of your offer: you will be able to gather their opinions more easily and ask them directly the questions that you are asking yourself about the evolution of your offer
- Your loyal customers have a positive impact on the morale of your employees: and yes, as loyal customers are happy then it is always nice to move forward in a positive environment rather than being surrounded by unhappy customers.
Remember that the 5 key points of an effective customer loyalty strategy are:
- centralising and exploiting your customer base
- communicating regularly
- developing a lasting relationship with your customers & subscribers
- measuring results and monitoring your e-reputation, refining and adapting your actions. The test & learn methodology is at the heart of your customer loyalty strategy.
In order to set up an effective customer loyalty strategy, it is essential to perfect your customer knowledge and to constantly listen to your community. This generally gives you the keys to improve your offer and maximise your growth.
Subscription, essential lever within your customer loyalty strategy
Now that we have understood why customer loyalty is essential to ensure the perennity and growth of your company, let us try to understand the advantages of subscription as a lever in developing customer loyalty.
Although traditional levers in developing customer loyalty (emailing, promotional offers, loyalty card and program) seem to work, we can see today the emergence of new levers in developing customer loyalty such as:
- micro-targeted offers: setting up specific offers based on the segmentation of your customer base
- levelling: this involves rating your customers according to the level of their engagement with your brand on social networking sites
- gamification: integrating games into your brand strategy in order to make it more fun and to maximise your customer engagement
- user experience: letting your customers have a positive experience on different interfaces (website & mobile web, tablet, mobile app…)
Subscription is an essential part of your customer loyalty strategy. It will allow you to:
- respond to your customers’ changing consumption expectations
- be regularly on your customer’s mind
- let your customers have a positive experience by surprising them (stray from the path of traditional communication)
- maximise your customer’s engagement with your brand: a loyal customer is a customer who buys more and becomes ambassador for your brand
- have an omnichannel customer loyalty strategy by reaching out to your customers directly in their everyday life
Take the example of the Evian At Home brand and their frequency option which offers their customers a subscription that enables them to receive the desired amount of water on a weekly basis.
You will now have understood that today, the largest brands have decided to offer several product offers or subscription services to their communities in order to win their loyalty.
Subscription is a solution which greatly simplifies your customer’s daily life and allows them to have a regular positive experience: so what is stopping you from getting started?