More is always better. The more often your customers buy from you the better. No matter what you sell, your goal should be to get your customers to come in to make more purchases.
While this is a general goal for business owners, you should note that the rate at which customers would buy a product would differ from industry to industry.
It does not make any sense to try to make a customer buy a house more than once a year, but it makes absolute sense to get them to buy groceries every weekend or month-end. This difference in frequency of purchase is a result of the durability and use of the product.
Before we proceed, we should define purchase frequency. This is the number of times a customer buys from a product or a business within a specific period, usually 365 days.
Why is it Important to Increase Purchase Frequency
There are many reasons why increasing purchase frequency is so important. Generally, the more purchases your customers make, the higher your chances of increasing the revenue of your business. Here are a few reasons:
2. A symptom of a Sustainable Business – The more of your existing customers that you can get to buy from you the more sustainable you prove your business to be in the long run. It means, you’re doing something right by your customers and that means your business has increased chances of staying in business.
3. Increase Profitability – The most obvious reason a business would want its customers to buy more frequently is that it is a great way to increase their revenue. A report by Adobe on e-commerce stores shows that although repeat customers were only 8% of a business’s customers, they contributed 41% of an e-commerce store’s revenue.
If you can get 41% of your revenue from 8% of your customers, won’t you want to increase that section of customers?
According to the Pareto principle, 20% of your customers can contribute 80% of your revenue – it makes sense to believe if e-commerce stores and other businesses can increase the purchase frequency of their customers, that segment of customers can account for a significantly higher portion of their revenue, thereby increasing their profitability.
Now, if these reasons are enticing enough to get you to ask how you can implement this strategy for your small business, we have highlighted a few ways to increase your customer’s purchasing frequency.
Four (4) Ways to Increase Customer’s Purchase Frequency
We’ve combed through different strategies that have been implemented over the years to highlight these 4 strategies for increasing purchase frequency. There are: –
1. Stay In Touch – The cliche “Out of touch is out of mind” is one because it is true. The less you interact with your customers the less they think about you. That is why big companies spend so much to run adverts every year to stay on top of their customer’s mind. But for most small businesses there are better ways to go about it.
You can use email campaigns to keep in touch with customers
You can use different social media channels to be present for your customers when and where they need you
You can run online adverts like retargeting ads to keep your customers coming back for more.
2. Loyalty Programs – If you want your customers to purchase more from you, you should reward and encourage that behaviour. Create incentives to get your customers to buy more from you. Loyalty programs have been a big hit because by rewarding existing customers for making purchases and engaging with your brand continuously, you make it easier for them to develop that habit. It is time for your business starts rewarding the behaviour it wants to attract.
3. Offer More Value – Keep your customers coming back to your store by offering more and more and more value. Customers can’t resist value. You can do this effectively by keeping them satisfied with your product or service quality, offering personalized discounts and flexible payment format to encourage their patronage and also developing complementary products to get them to come back more than they normally would.
If you own an ice cream store developing more flavours would give your customers more reasons to increase their purchase frequency because they want to try the new flavours. If you’re a car dealer, someone who just bought a new car may not be interested in your adverts for a new car, but you can increase their purchase frequency if you offer car accessories and such that can help them make their cars look better.
4. Get them To Subscribe to Recurring Orders – More businesses are offering subscription plans because it is an effective way to both increases their customer purchase frequency, increase revenue and makes it all predictable.
Small businesses can develop subscription plans for their customers if they are not operating a subscription model. A good example is Amazon offering Amazon prime. On the other hand, businesses that operate subscription models can try to get their customers to subscribe to longer periods.
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