How to create a successful customer loyalty strategy

How to create a successful customer loyalty strategy - Phoenix Business Journal:



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Every business owner knows that new customers will contribute to their business growth, but while they are busy marketing and chasing new prospects, they fail to realize that it's far easier and less costly to hang on to their existing customers.

Customer retention is incredibly important for growing a sustainable business. Because there is always a cost for acquiring them, you typically don’t even start making money until they’ve bought from you an average of two times. Creating a customer loyalty strategy to encourage repeat business can be both fun and rewarding.

Is it right for my business?

Customer loyalty strategies aren’t right for every business. If you have a business that sells frequently purchased products such as a sandwich shop, nail salon or ice cream parlor then it makes sense to remind them to come back to you. A real estate agent or car dealer on the other hand, doesn’t expect repeat business to occur for many years.

You also need to be able to offer something worthwhile. If you are in a low-cost, commodity business with no margins to play with, it’s difficult to create a loyalty system that anyone would find significant enough to care about. If your customers are already loyal, you’re better off sending them a thank you card every so often.

What can I offer them?

Figuring out what you can afford to offer them is the No. 1 consideration. You have to know your margins and how many times it would take for a customer to buy from you before it would warrant you providing them with a free offer.

Understanding your target market is also critical. If you’re selling to an older demographic on a fixed income, any type of discount will likely be most appreciated. A wealthier clientele might appreciate extra service perks such as free valet parking, complimentary coffee or free alterations.

You could also provide something extra at every sale, such as chocolate. Or work out a reciprocating arrangement with a non-competing business to offer a free service to each other’s customers. Using a lucky draw system is an example of an entertaining way to keep customers coming back.

Loyalty clubs

People have to see the benefit to belong to a loyalty club. They have to feel they’re working toward something or getting special treatment. There are basically two types of systems you can use: customers get a benefit after spending a certain amount of money, or visiting a certain number times. Or they get a benefit every time.

The simplest method is to give a customer a card and stamp it every time they’ve visited. Figure out your profit margin, make it as generous as possible and you’ll be the most popular business in town.

You could instead choose to use a credit system. For instance, for every $10 spent, the customer earns a dollar credit to be used on a future purchase. A points system can be similarly effective. $10 may equal 100 points that can then be used to buy something you sell.

Get the word out

Simply putting a sign in your window or a notice on your website that says “ask about our loyalty program” doesn’t work. You have to embark on an active campaign to get the word out. Mention it to every customer. Send them an email or a direct mail flyer.

To encourage your existing customers to return, creating a customer loyalty strategy can make an impact. A successful campaign only has to bring you in more money than you’ve invested in it to make it worthwhile. Even so, it’s vital to test and measure as you go so that you know your strategy is producing results.

Remember, keeping an existing customer is far cheaper than finding a new one.

Sheila Kloefkorn is CEO of KEO Marketing Inc and Firm Owner/Business Coach with ActionCOACH. She was recently recognized as one of the Top 25 Dynamic Women in Business by the Phoenix Business Journal. Sheila can be reached atsheila@businesscoachingaz.com.

Customers Hungry for New Menu Items Seen in Mobile Ads - eMarketer

Customers Hungry for New Menu Items Seen in Mobile Ads - eMarketer:



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Menu info in a mobile ad is biggest influence in deciding where to eat

When choosing where to dine, it comes down to the menu, not the restaurant, according to a December 2013 study by JiWire.

More than one-third of US mobile Wi-Fi users polled said that menu information in a mobile ad was the most likely to influence them to eat at a restaurant. Sales or coupons, often considered good methods to drive restaurant traffic, ranked second, at 24%, and location was actually third—indicating that people may be willing to drive a little farther to get something that looks tasty.

Nearly half of consumers had tried a new restaurant or menu item based on a mobile ad, and three-quarters said they were more likely to try a new menu item after seeing a mobile ad for it.

Read more at http://www.emarketer.com/Article/Customers-Hungry-New-Menu-Items-Seen-Mobile-Ads/1010634#9pLQdxprL1OurBhZ.99

Study: Social Media Driving Hyper-Growth for SMBs - SocialTimes

Study: Social Media Driving Hyper-Growth for SMBs - SocialTimes:



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There might be more big brands on social media these days, but according to a recent LinkedIn study, social media is an important driver of growth for small and medium businesses.

SMBs account for a huge part of the economy. Young businesses in particular are the biggest contributors to job growth and seven out of 10 new jobs are created by a small business, according to the study.

The study, which included a survey of nearly 1000 SMBs in the US and Canada, indicates that SMBs are optimistic and focused on marketing in 2014. In fact, more than 90 percent of SMBs are either current users of social media or plan to use it in the future.

Among those currently using social media, nearly all are using it for marketing. The top reason for social media marketing according to the study? Simply to maintain a company presence and identity online. SMBs also use social media to generate word-of-mouth about the business, deliver content about the company, increase awareness and generate new leads.

According to the study, one in six SMBs on the grow are in what was referred to as hyper-growth mode. Indeed, companies experiencing hyper growth report a 73 percent increase in social media spend, indicating that social media is an effective tool for branding, generating word-of-mouth, content marketing and lead generation.

Nearly half of SMBs using social media also use it for learning and sharing resources. Not only are SMBs sharing with and learning from each other, they’re also using social media to keep tabs on financial trends and institutions, according to the study. The financial information SMBs are most interested in but not getting includes how-to guides and checklists, technological developments, new products, company background and industry news.

Based on the data, the study identified several opportunities and best practices for marketers, including targeting hyper-growth companies, taking advantage of unmet content needs and building credibility by creating open dialogue.

Innovation Firm ReD Shows Clients How to Use Philosophy to Sell Stuff - Businessweek

Innovation Firm ReD Shows Clients How to Use Philosophy to Sell Stuff 



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When the German philosopher Hans-Georg Gadamer died in 2002, at the age of 102, he was unaware of the impact he would posthumously have on mobile electronics, distilled beverages, and personal grooming, among other consumer-product categories. A giant in the field of phenomenology, Gadamer examined how human beings perceive and make sense of the world around them. He was celebrated for adapting hermeneutics—interpretive methods originally developed by Biblical scholars—to the study of human perception, but over his long career he also wrote about music, visual art, politics, medicine, and myriad other topics. He did leave some questions unanswered, however, such as: How can a low-end electronics company create products that wealthy consumers crave? And: What do women want in athletic gear?

According to two Danish strategy consultants, that was a lost opportunity. Gadamer’s hermeneutics aren’t only useful for understanding existence, argue Christian Madsbjerg and Mikkel Rasmussen; they offer insight into commercial questions as well. The two believe that Gadamer, his mentor, Martin Heidegger, French phenomenologist Maurice Merleau-Ponty, and any number of scholars considered abstruse even in the ivory tower can help companies solve some of their most complicated business challenges. To bring this form of problem-solving to theGeneral Electrics (GE) and Lululemons (LULU) of the world, Madsbjerg and Rasmussen built a consulting firm, Red Associates, around the Monty Python-like idea that corporate leaders need to channel their inner Heidegger.

“It’s applying very theoretical constructs to very concrete situations,” says Madsbjerg, a cultural theorist with the air of a precocious teen. “I think that’s the ultimate skill that’s here. I don’t think that the people that designed theories of identity ever, ever thought about toothbrushing, but it’s very, very helpful.”

Dustin Aksland for Bloomberg BusinessweekMikkel Rasmussen

“I’m probably more practical. I’m more interested in how you use this,” adds Rasmussen, a cheerfully argumentative economist. “Christian is very much into Heidegger, and I understand why, because once you get down to what it is he’s really trying to say, it is really inspirational. It gives you a completely new idea about ‘what is it I do, and how do I study something?’ ”

Since opening its doors in Copenhagen a decade ago, Red has signed up some of the biggest companies in the world, including Intel (INTC), Novo Nordisk(NVO), and Beiersdorf (BEI:GR)(makers of Nivea skin-care products). Samsung Electronics relied on Red’s research in designing what would become the world’s best-selling televisions. Red helped Adidas (ADS:GR) unshackle itself from its focus on competitive sports so it could capture much of the exploding fitness and sports-lifestyle market. With the firm’s advice, Pernod Ricard (RI:FP)figured out how to sell more vodka in a world where fewer people are drinking in bars.

“The great thing about Red is that they’re supersmart,” says Mike Milley, the director of Samsung’s lifestyle research lab. “They are an unparalleled deliverer of that well-framed idea that’s going to help tell the story of what we need to do.”

Red’s 70 consultants, hired mostly out of graduate programs in sociology, philosophy, political science, history, and anthropology, conduct a form of ethnography, embedding themselves in the lives of consumers the way Margaret Mead did among Samoans. They interview their subjects and the people around them, itemizing the contents of their kitchens and dressers while photographing and videotaping, and accompany them as they prepare a meal, or commute to work, or primp for a night out. Then they sift the resulting information for weeks, even months, looking for connections and telltale behaviors.

Several years ago, Lego turned to the firm. In an attempt to compete against the immediate gratification of PlayStations, the company was marketing easier Lego sets, action figure lines, and jewelry kits that weren’t really about building at all. Yet Red’s research showed that, while kids love video games, many also love things that reward time and patience and, importantly, allow them to show off their hard-earned skills. In an example that has become Lego lore, Red found an 11-year-old German boy whose most prized possession was a pair of skateboarding shoes worn down in such a way that it was obvious to his fellow skateboarders that he had mastered a specific trick.

Those were the kids Lego should be courting, Red argued, and they didn’t want easy Lego sets, they wanted hard ones. The insight helped persuade the company to jettison much of its product line, part of a larger refocusing that has put it at the top of the toy industry.

Winter Storm Pax Brings Hardware Store's Busiest Morning in 41 Years

Winter Storm Pax Brings Hardware Store's Busiest Morning in 41 Years 



Hardware store owner Henry Burke is cautioning customers to head home early, but he’s planning to work the full day.

With winter storm Pax beginning to hit Raleigh, North Carolina, Burke says business has never been better.

“This is the busiest morning I’ve seen in 41 years,” says Burke, whose father opened Raleigh's Burke Brothers Hardware in 1936. “If you had called this morning, we couldn’t have answered it. We have three lines, and all were ringing.”

Burke says yesterday he served more than 1,000 customers prepping for Pax. The winter storm has already knocked out power for a reported 200,000-plus homes and businesses in the Atlanta area, and is expected to move up the East Coast Wednesday into Thursday.

On his end, Burke says the price of rock salt has been up and down. “When it’s like this, you buy it: It doesn’t matter what the price is,” he says. Luckily, the store got a big delivery early Wednesday morning, helping Burke meet the demand.

Farther north, fourth-generation hardware-store owner Russell Hunter says it’s also been a banner year for rock salt.

“There’s been tremendous demand. So far I have not had an issue getting it … but my supplier did warn me he is starting to dwindle,” says Hunter, who runs Pfau’s Hardware Store in West Hartford, Conn. While rock salt is still in supply, Hunter says he just sold out of roof rakes.

Hunter says his supplier raised the price of rock salt a few percentage points, but he decided to keep his prices stable.

“I’m making a little less on it, but that’s OK. I’m hesitant to change it in-season: I start with a price and I like to keep that through the end,” says Hunter. He is selling 50-pound “Safer than Salt” bags for $26.

In East Northport, New York, Karp’s Hardware Store owner Alan Talman is having a harder time keeping salt in stock.

“There’s more people looking for rock salt than there is [supply] … The demand has certainly outstripped the supply,” says Talman. “We don’t usually get this much winter – we’re usually well prepared.”

Talman says this is only the second time in 24 years that he has seen this great a demand for snowstorm essentials like rock salt and shovels.  While he’s sold out for the moment, he is expecting a delivery tomorrow.

“Everyone is coming in. The phone is ringing dozens of times an hour, specifically for rock salt,” says Talman.

And though he can’t provide rock salt for the time being, Talman is still able to hand out some wise winter-storm advice.

“Stay home, drink heavily and don’t drive, and it will be gone before you know it. Spring is right around the corner,” says Talman.

How to Show Love for Your Customers on Valentine’s Day

How to Show Love for Your Customers on Valentine’s Day



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Valentine’s Day is all about showing the people we love how much we care, which typically prompts companies to court customers by busting out red flyers and heart-shaped decorations.

You don’t have to do that, of course. But, as a small-business owner, you would be remiss to ignore Feb. 14, especially if you offer a product or service that could make for a sweet, friendly, or romantic gift.

What’s more, regardless of your industry, you can build customer loyalty by showing appreciation for your dedicated patrons on Valentine’s Day. Here are a few ideas for accomplishing that:

• Send branded valentines on social media. Thank your customers for their business with branded Valentine’s Day cards — digital missives that include your company’s logo and website address. As people share your love via social media, more potential customers will become aware of your brand. (This is an especially savvy marketing move if your customers pin or re-pin the card to a Pinterest board.)
• Step up your customer service. People often have high expectations for Valentine’s Day — and tend to psych themselves out when trying to get every little detail perfect. Erin Raese, president and chief operating officer of Loyalty 360, recommends that small businesses focus on customer service when marketing around Valentine’s Day. “Make this challenging holiday easier,” she says. “Then help your customer create a thoughtful gift or experience.” By being helpful and considerate, you will also “create an emotional bond with your customer, [which] should create future returns.”
• Stick to your brand’s ideals. If your business doesn’t mesh well with Valentine’s Day, don’t force the issue and risk coming off as insincere and cheesy. However, you can recognize the holiday without putting candy hearts on everything. For example, let’s say you run a pizzeria. Rather than forcing Valentine’s Day onto the brand, you could team up with a neighborhood flower shop to give its customers a coupon for a free order of bread sticks when a customer makes a purchase there, Raese says. By adding value to a purchase and offering something for free, co-marketing can help drive sales and boost loyalty for both businesses.
• Evoke emotion. Valentine’s Day is an emotional holiday, so it’s appropriate to play off that emotion to some degree. “A restaurant could give each woman a rose,” Raese suggests. It is the act of doing something thoughtful or making a customer feel special that triggers an emotional response. Customers won’t forget that little something extra you did for them, which increases the likelihood they’ll return on another occasion.

Figuring out the right marketing strategy to use this Valentine’s Day doesn’t have to be a head-scratcher. Just consider what your customers want and need — and the rest should fall into place.

Read more: http://blog.intuit.com/marketing/how-to-show-love-for-your-customers-on-valentines-day/#ixzz2t1mPk0C5

Retail spend on local campaigns up 433pc during holidays: Nexage

Retail spend on local campaigns up 433pc during holidays: Nexage 



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February 10, 2014

In the fourth quarter, retailers increased spend on local, mobile campaigns during the holidays by 433 percent for those based on ZIP code and 142 percent for those based on latitude or longitude, according to a recent report from Nexage.

The “Nexage Analytics Report: Brand Spend Takes Flight” report found that 46 percent of marketers and agencies thought that mobile was important as an advertising vehicle and 85 percent think it will be important in three years. Nexage claims that since more consumers have shifted to mobile, marketers and agencies are now playing catch-up.

"I think retailers are creating different geo-fence structures for different campaigns, which is giving them different methods of attracting consumers to events or stores," said Victor Milligan, chief marketing officer of Nexage, Boston, MA. 

"Larger geo-fences can leverage ZIP code, smaller geo-fences rely on lat/long," he said. "The portfolio of both gives retailers the greatest options and likely the best results.

"ZIP-based targeting can be a powerful method to extend reach, especially in areas where tight geo-fencing may inadvertently create reach scarcity. The trick is to play with the location structure that makes the most sense for the campaign, for different days of the week, among other considerations."

Catch-up
Now that mobile is becoming a more respected channel for marketing, ad spend is increasing. Total ad spend on the NexageExchange grew 80 percent during the holiday season.

Retailers in particular embraced mobile more aggressively. Brand spend specifically increased 135 percent during the holiday season, peaking at 70 percent of total spend.

There was a spike on Black Friday, topping the daily average the preceding weekend by 29 percent and the following weekend by 21 percent. During the three weeks after Black Friday, daily retail spend increased by 103 percent on Saturdays, compared to other days.

One of the main goals of retailers in the fourth quarter was to increase store traffic, so retailers pushed a lot of geolocated campaigns.

Local campaigns that leveraged ZIP codes or cities increased 433 percent, and hyperlocal campaigns that used latitude/longitude increased 142 percent.

While an increase was definitely expected around the holidays, Nexage expects this increase to kick-start a long-term acceleration in mobile ad spend. The company predicts that mobile spend will overtake online spend by 2017.

Mobile ad spend
As marketers realize the greater potential in mobile advertising, it is interesting to watch how the ad themselves evolve.

This past quarter seems to show a greater interest geolocated ads.

Last summer, marketers were focusing on real-time bidding, with Smaato reporting that its RTB ad exchange hit a $110 million annual run rate this month, while Nexage saw more than 50 percent of revenues on its exchange coming from RTB (see story).

"Retailers took greater advantage of mobile to drive more lucrative in-store sales," Mr. Milligan said. "Retailers like Walmart and Target have shown significant growth from 2102 on the Nexage Exchange, and it shows that the power of mobile is significantly enhancing holiday sales."