Your grocery store example nails why loyalty is so lucrative when competitors are basically the same.
Those Adobe stats say it all - a tiny 8% of customers drive 40% of revenue because they're the repeat, habitual buyers. The fickle singles don't move profit needles nearly as much.
It's the 80/20 rule in action. Convert casual buyers into fanatical repeat purchasers, and you've cracked the money printer code.
I saw this first-hand with a client obsessed with relentlessly acquiring new customers rather than cultivating existing ones. Their retention data was abysmal - almost mirroring those awful Adobe averages. Dump more into the leaky bucket's top while hemorrhaging out the bottom.
My fix? Focus on delivering outstanding experiences to engage and retain that small-but-precious base of existing buyers. Revenues skyrocketed as formerly fleeting purchasers turned into habitual subscriber life-forces.
Neela I love your example! I know how frustrating it is to work with clients who are obsessed with new customer acquisition, and take the current customer completely for granted. I hope your client changed their mind about customer retention (and reupped you at a higher rate)!
Another insightful article Mack.
Your grocery store example nails why loyalty is so lucrative when competitors are basically the same.
Those Adobe stats say it all - a tiny 8% of customers drive 40% of revenue because they're the repeat, habitual buyers. The fickle singles don't move profit needles nearly as much.
It's the 80/20 rule in action. Convert casual buyers into fanatical repeat purchasers, and you've cracked the money printer code.
I saw this first-hand with a client obsessed with relentlessly acquiring new customers rather than cultivating existing ones. Their retention data was abysmal - almost mirroring those awful Adobe averages. Dump more into the leaky bucket's top while hemorrhaging out the bottom.
My fix? Focus on delivering outstanding experiences to engage and retain that small-but-precious base of existing buyers. Revenues skyrocketed as formerly fleeting purchasers turned into habitual subscriber life-forces.
Neela I love your example! I know how frustrating it is to work with clients who are obsessed with new customer acquisition, and take the current customer completely for granted. I hope your client changed their mind about customer retention (and reupped you at a higher rate)!
YES and no lol