Which is more important? Customer acquisition or customer retention? It’s the chicken-and-egg debate of business ownership. For anyone who owns a franchise, the answer is both. In order to succeed, you’ve got to work hard at bringing in new customers across all your outlets while simultaneously building and nurturing established relationships. Consider the stats:
- Two-thirds of revenue at most companies comes from existing customers.
- New customers are expensive. It can cost up to 7x more to attract a new customer than to retain an existing one.
- An existing customer is more than 3x as likely to make a purchase during a visit to your business than a new one is.
- On average, the potential value of a repeat customer’s visit is up to 10x that of a new customer.
- 86% of consumers will pay more for a better customer experience.
- Customer experience is so important to consumers that 89% will choose to do business with a competitor rather than return after an unsatisfactory contact.
What can you do to improve CX and boost customer retention at your franchise locations? The latest technology offers cutting-edge tools that can make a significant difference.
Get friendly with your customers.
Know who is coming into your business. Familiarize yourself with your customers’ profiles, patterns, and preferences. Keep those data fields full and make each contact personal. Use your customers’ names in email subject lines and headers. Offers personalized deals and rewards whenever possible.
Even as you explore ways to improve business with technology, remember that personal interactions matter. Encourage employees to greet customers with a smile.
Crunch your numbers.
You’re going to lose some customers to issues beyond your control like relocation and death, but metrics can help you minimize attrition. How many new customers visited your business last month or last year? What percentage returned? What did their average purchase look like? Understanding these figures will drive the informed decisions that you have to make in order to cut costs and increase revenue.
You can get the data you need in many ways. Begin by tracking website activity with cookies, soliciting feedback with emailed surveys, and monitoring your Google Analytics.
Make sure you’re smartphone-friendly.
Regardless of demographics, the overwhelming majority of consumers own and use mobile devices. The Pew Research Center reports that 97 percent of Americans currently own a cell phone. Eighty-five percent own a smartphone, up from 35 percent only 10 years ago. Are you taking advantage of the new mobile marketplace? At this point, your website and emails are probably optimized for mobile use but there’s more you can do.
Use text messaging to offer special deals. Consider hiring a contractor to develop an app that allows you to take mobile orders, offer scanning, and enable contactless payment.
Up your game on social.
Americans spent an average of 1,300 hours on social media in 2021. Facebook was, and still is, the most popular platform, followed by Instagram. Younger users are flocking to TikTok. What are you doing to keep your business top-of-mind?
Populate your social media streams with fresh content regularly. Photos and videos are critical. Images of people are more personal and relatable than those without. They attract more viewership and engagement, so go ahead and post that selfie or a happy photo of employees enjoying their work.
Try some social media advertising. Offer exclusive deals and create discount codes just for followers, then use buttons that make it easy for them to click and spend. Track metrics carefully so you know what to repeat and what to change.
Finally, follow the competition. You’ve got to keep up on what others in your field are doing.
Implement a tech-based customer loyalty program.
There’s a simple reason that airlines offer frequent flyer programs: they work. The airline cultivates an exclusive relationship with a traveler and that repeat customer is rewarded for their repeat business with perks that keep them coming back again and again. That same “loyalty economics” mindset can have a significant impact on your customer retention rates and positively impact the bottom line. In one study, researchers from Bain & Company working with Earl Sasser of Harvard Business School found that increasing customer retention rates by five percent increased profits by a whopping 25% to 95%.
With an app-based Loyalty Management System (LMS), you can create the same dynamic at your franchises. Engage a service that helps you provide incentives and special offers and includes an integrated point-of-sale system.
Create a consistent customer experience.
Standardizing a consistent customer experience can pose a challenge for the 54% of franchise owners who operate multiple locations. Modern technology offers a solution.
Checklists are critical to the management of tasks related to opening, closing, daily operations, audits, and inspections. There was a time when owners and managers ensured compliance and quality control by handing employees a clipboard with a form and pen attached. And then what happened to the completed checklists? They were filed away in binders. They sat on a shelf and collected dust. Useful data that could have been used to improve operations was left unexamined. Time and money were wasted. Problematic operations continued and customers defected as a result. Businesses suffered.
- Boost customer retention by standardizing CX
- Monitor checklists and maintain brand consistency from anywhere using existing devices
- Increase local and regional manager efficiency
- Respond promptly to issues and concerns
- Observe, record, and address standards infractions
- Improve environmental practices by reducing supply consumption
Join the multi-unit franchise operators using MeazureUp’s digital field audit apps to track operations and ensure brand consistency.