Why Customer Loyalty Is More Important in 2023 Than Ever
In these unprecedented times, COVID-19 has taken a huge toll on the world, and put global communities under immense pressure. From an economic point of view, not since the 2008 global financial crisis has the world economy been hit so hard.
Some industries are suffering more than others – for instance, commodity prices around the world have fallen a record-breaking 20%.
Meanwhile, the aviation industry all but ground to a halt for a while, with 90% of the global fleet sitting idly in hangars and dormant airports during 2020. As such, the tourism sector shrunk drastically.
However, as restrictions begin to ease around the world, businesses everywhere have reopened their doors.
Your existing customers can help your business bounce back
Any loyalty marketer will tell you that retaining customers is far more important than acquiring new ones. This is truer now than it ever has been before.
Increasing your customer retention by just 2% is equal to cutting costs by 10%. Increasing it a further 3% can result in as much as a 125% rise in profits. This is because existing customers typically spend two-thirds more than new customers do.
These statistics count for a lot in this new environment, where consumers are hesitant to part ways with their hard-earned money.
As a provider of digital loyalty program solutions, Stamp Me has clients all over the world – we compiled our data of global café loyalty transactions since the outbreak.
While the trends naturally show a clear mid-March 2020 drop across the globe, the data reflects that loyalty transactions rose again as lockdown measures eased in certain countries.
“Mere weeks after certain countries began to ease their lockdown policies, we saw a steep peak in businesses wanting to implement a digital loyalty program,” says our Head of Marketing, Michaela Ward.
How has COVID-19 affected customer loyalty?
Customer loyalty is more important than ever in 2023.
Consumers are eager to support small independent businesses. There was a drastic increase in the purchase of gift vouchers as a way to keep local businesses alive while their doors were closed.
Merchants that make it easy for existing customers to support their business will bounce back faster than those that don’t. This is where a good loyalty marketing plan can be the difference between success and failure in a post-COVID-19 economy.
So, how can businesses entice their existing customers back to the shelves?
The pandemic has taught countless business owners some harsh lessons, but perhaps none has been more important than this: go digital, or go home empty-handed!
Businesses with little to no digital presence immediately lost all contact with their customer base. On the other hand, businesses with a digital connection to their customers (be it social media, email marketing, a digital loyalty app or other means) have maintained a direct line of communication throughout this coronavirus outbreak.
When communities started going into lockdown, not every company was in a position to shift its business to an ecommerce platform – for example, hair salons, dental clinics and other hands-on service providers really had no choice but to cease all operations.
However, many of these businesses have managed to keep their customers engaged with helpful tutorials, exclusive offers to be redeemed upon reopening, and other content that keeps the brand front of mind and strengthens the customer’s emotional connection.
These are the businesses that can count on familiar faces returning to their businesses now that the world is spinning again, because they managed to continue providing customers with a personalized brand experience even in the face of adversity.
In 2023, a good customer loyalty program has never been more important.
Stamp Me provides loyalty solutions to businesses large and small, from our own Stamp Me Loyalty App to fully customised loyalty and rewards programs for enterprises and brands.
Contact us if you would like to discuss a loyalty or rewards solution for your business or brand.