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There are 31.7 million small businesses in the United States. Customers like you and me remain at the heart of each one.
Customer loyalty and retention have been instrumental in keeping small businesses’ doors open amid 2020’s craziness and a harsh economic climate. Just think about your favorite local restaurant, your go-to auto mechanic, or even your own small business and the gratitude that exists—and has only grown—for customer loyalty over the past few months.
All things considered, customer loyalty and retention predate—by a long shot—this pandemic. Since the concoction of small businesses (and the 40 hour work week) we all enjoy going “where everybody knows your name.”
*Cue Cheers theme song.*
So stick with us to read 21 customer loyalty and retention statistics for your business in 2021.
1. An existing customer is nine times more likely to make a purchase than a new customer. (Adobe)
2. A whopping 56% of customers will stay loyal to a business that “gets them.” (SmallBizGenius)
3. The likelihood of selling to a prospective customer is 5-20%. (Altfeld Inc.)
4. The likelihood of selling to an existing customer is 60-70%. (Altfeld Inc.)
5. Customer loyalty programs—such that allow customers to earn and spend points—influence 69% of people to choose a particular business. (Microsoft)
6. 54.7% of consumers join loyalty programs to save money, while 37.5% join to earn rewards. (Microsoft)
7. 54.7% of customers reveal that they’re truly loyal to five or less brands. (Yotpo)
8. 84.3% of people choose to shop with companies whose values align with their own. (Yotpo)
9. When surveyed, 75% of consumers admit to favoring companies that offer loyalty and reward programs. (Small Biz Genius)
10. People are 72% more likely to refer a brand to friends and family if they have a fruitful loyalty program. (Grom)
11. “Meaningful brands” outperform competing companies in the stock market by a 134% margin. (Vivendi)
12. On average, a United States company will lose 20-40% of its customers—a problem mitigated in part by improving customer loyalty. (Altfeld Inc.)
13. Existing customers spend 31% more on average than new customers. (Sailthru)
14. Decreasing your customer churn rate by just 5% can increase your profits up to 125%. (Fundera)
15. Only 15% of consumers will work with a brand who has questionable security practices (85% say no way). (Pwc)
16. According to the Pareto Principle of economics, nearly 80% of a business’s profits come from only 20% of its customers. (Forbes)
17. There is a 54% repurchase rate from retained customers who had their customer service complaints resolved. (Altfeld Inc.)
18. There is an 82% repurchase rate from retained customers who had their complaints resolved quickly. (Altfeld Inc.)
19. People believe in philanthropy. 53% of consumers believe businesses have a duty to be involved with at least one social issue outside the realm of their industry. (Edelman)
20. When a company has excellent customer service, 93% of consumers are more likely to serve as repeat customers. (HubSpot)
21. 32% of consumers would completely stop doing business with a brand because of one bad customer service experience. (Pwc)
Now that you understand the importance of customer loyalty and retention, you may be asking yourself “how do I know if I’m doing it right?”
Cross reference your current business model with the following tips to optimize your business’s customer loyalty statistics.
Your customers are more likely to return if they have a little motivation. As mentioned above, 69% of consumers make purchases based on the availability of loyalty cards and programs.
Check out this article for more information on how to set up digital loyalty cards on any budget.
It takes a whole lot of work to gain a customer and only a single negative customer service experience to lose them.
Ultimately, people want to be treated fairly by kind people, so keep a good pulse on your customer service department. Listen to your customers’ feedback and make necessary changes as you go along.
Your customers and your business will be all the better for it.
Business owners are consumers too; we’ve all surely felt misunderstood by a company a time or two before. Try hard to understand your clients’ needs and wants, as well as their frustrations with your brand or services when they arise.
Here are a few ways you can be more relatable to a wider variety of people:
Bonus tip: 100% of small businesses who stay tuned with GoSite for small business advice are happy that they did.