Hilary, Author at Plastic Cards

More than 40% of companies admit to being more focused on customer acquisition than they are on retention.

And really, to many business owners this makes sense. You should be trying to grow your business…right? Of course, growing your business with new customers through customer acquisition would naturally sit in the top 3 priorities of any business. But those companies whose main goal is to build their business through finding new customers might be missing the profits that can be had from re-engaging existing customers.

How valuable are existing customers?

One of the most astounding stats show that increasing customer retention rates by just 5% can increase profits by 25% – 85% (Bain & Co ). While that seems incredible, stats also show that re-engaging and retaining past customers is less work and more value than trying to find new ones, who then need to be educated about your products, your brand and your purchasing system. In fact, attracting a new customer costs five times as much as keeping an existing one (Lee Resources 2010). Not only that, the probability of selling to an existing customer is sitting between 60 and 70%, while the probability of selling to a new one is between 5 and 20% (Marketing Metrics).

How can we re-engage our existing customers?

Keeping a customer for life is a huge part of ensuring that business grow and are successful. As we can see from the stats above, acquiring a customer is alot of work and expense, one that you don’t want to have to repeat just to cover the customer who went to a competitor because they don’t feel connected or engaged with your business.

There are some simple ways that you can engage your customers and get them buying from you again:

Post purchase emails: Make the first purchase from your business a special one. If a customer has just made their first purchase, why not welcome them to the club with a welcome email and some suggestions for other products they might like.

Reminder emails: If a customer hasn’t purchased in a while, send them a reminder email about who you are and why you love doing business with them. Send them some suggestions for products for the upcoming holiday season (Christmas present ideas or Valentine’s Day products) to help get them engaged with your business.

Rewards for your most valuable customers: Reward your most valuable customers with an incentive for next time they shop with you, one that is valid only for a small number of your most valued customers. One of the most effective strategies I have seen is sending a customer a gift voucher to spend instore two weeks after a particularly big purchase. It gives them a great surprise, as well as a reason to come back.

Refer a friend rewards: Retaining customers is not just about keeping a valuable customers purchasing from your business. It’s about creating brand advocates. Reward your customers and create a ‘refer a friend’ rewards program. You’ll find people won’t refer people just for the gift, but if they love your business, they will be actively thinking about who they can refer you to.

Event discount emails: Is your 5th business birthday coming up? Send out a small discount to all your customers to celebrate, and thank them for their support. For those customers who haven’t thought about your service / product for a while, it might be just what they need to purchase again.

Regular newsletters: Don’t forget the power of the simple newsletter to stay top of mind with your customers. A valuable news article about changes in the industry, a new product launch or spotlight of your existing products will prompt those customers who require your product to order.

Points or loyalty system: The points system works really well for a lot of businesses and encourage frequent and repeat purchases. Cafes, retailers, beauty therapists and more can use points based systems to keep customers coming back, via key tags or loyalty cards.

VIP events: VIP events can be a great way for people to refer friends to your business. If you’re a bricks and mortar shopfront, have an exclusive shopping event, or a launch of a new product. And for those of you exclusively online – don’t think that events are valid just for retailers with a street presence. Email out an exclusive online discount code to be used at a specific time on your website and treat it like your own online launch party!

Create a customer journey process

One of the best ways to figure out how you want to engage your customers regularly and effectively with your business is to create your ideal Customer Journey Process. Sit down with your team and brainstorm; what’s the perfect journey for a customer to make through your business? How often would they want to hear from you? What are the best times throughout the year to communicate? Write it down, make a plan and revisit often. It should be flexible and fine tuned on feedback from your customers and your team.

Let us help you

Redegroup are experts at creating products to help your customers coming back to your business, and feel like a VIP. Our gift cards help them to share their love for your business with their family and friends. And our loyalty cards are custom branded and can carry a range of different information about your customer, from key tag to wallet cards.

We don’t just print the order and leave you to deal with the coding, we help you choose the right coding to fit with your system. Redegroup even provide a live sample from your order for you to check with your system, to give you peace of mind that it works correctly.

The NSW Government has recently introduced a mandatory minimum expiry period of 3 years for gift cards and gift vouchers sold to a consumer in NSW.

More than $2.5 billion of gift cards and gift vouchers or approximately 34 million cards, are sold in Australia every year. Of these gift cards, approximately 8% are never validated to their full balance due to the card expiring before the recipient has the opportunity to redeem the full value of the gift.

Having been inundated with complaints over the last few years, NSW Fair Trading has made the changes to “put the consumer first” in the gift card market, extending the expiry period from 1 year to 3 years for all gift cards sold in NSW. The NSW gift card changes also include a ban on post-purchase administration fees, starting 31 March 2018. The NSW government insists that the new reform will give consumers access to the full value of their gift card over a reasonable period of 3 years, while also maintaining a workable business model for traders.

To keep you informed, we’ve put together some answers to FAQs on the new changes:

When do the NSW gift card changes start?

The reforms started on 31 March 2018. The reforms do not apply to gift cards and vouchers purchased by consumers before 31 March 2018. The terms and conditions in place at the date of purchase of those cards will continue to apply.

Does this apply to gift vouchers as well as gift cards?

Yes. Changes apply to both gift cards and gift vouchers. The period begins from the issues date, or the date a gift card is sold to a consumer. Businesses can choose to apply an expiry period longer than 3 years and no maximum expiry period applies.

Ban on post-purchase fees

Once the gift card or voucher has been issued, there is also ban on charging any post-purchase fee associated with redeeming the card/voucher that would reduce its value. Terms used for post-purchase fees that will be banned include: activation fees, account keeping fees, balance enquiry fees, telephone enquiry fees and fees applied when a card is inactive or not being used (sometimes called dormancy or inactivity fees).

However, there is an exception to the ban on post-purchase fees, which include any fees that are part of the cost of processing payment, which apply regardless of the method of payment. This might include overseas transaction fees, booking fees or payment surcharge fees and are not are not captured by the ban.

How do I know if the NSW gift card changes apply to me?

If you are unsure whether the new laws apply to a particular gift card or voucher, answering the following questions will help:

1) Has there been a sale of a gift card? If the answer is yes, the card or voucher is covered by the new laws unless specifically excluded. Cards that have not been sold, such as donated cards or unsolicited discount vouchers handed out on the street, and are not covered by the new laws.

2) Has there been a sale of a gift card to a consumer in NSW that can be used for goods or services in NSW? If the sale is to a consumer as per the following definition, the card is covered by the new laws unless specifically excluded.

Get expert help with your new gift cards

If you would like expert help on putting together the terms and conditions for your new gift cards, talk to the Redegroup today on 1800 815 512. We know the ins and outs of the new changes and are ready to help you!

Order your free sample pack of our plastic card products and get a quote for your next order.

All posts by Hilary

The danger of focusing solely on customer acquisition