Why Companies Should Care About Customer Loyalty

I mentioned this in an earlier post recently, What’s the Difference Between Free, Freeium, and Premium Genealogy Websites?. Numerous studies have shown that keeping  me as an existing customer is much cheaper than recruiting me as a new customer. Companies need a mix of new customers and existing customers, but the focus has been for a while to focus on gaining new customers over keeping existing customers. When I was young, many companies rewarded existing customers in various ways. These days most companies ignore long-time customers and only reward new customers. There are exceptions. I mentioned BillionGraves when it offers a discount price to sign up, the discount price is your regular price as long as you keep renewing your subscription. That’s the exception in today’s market. Usually, you get a one-time discount and a subscription jumps to its regular price after you renew. BillionGraves offers ways to extend your subscription by transcribing so many records or uploading so many photos.

It’s been a few years back, but GEICO sent me an e-mail offer to the same e-mail they sent my ebills – not sure why as they should know it was my e-mail address. In the offer, it was a substantial savings to what I was paying them for car insurance. I tried to use the offer and was told it’s only for new customers. End result, the next time it came to renew, I went shopping for car insurance. I heartily recommend people shop around for car insurance as the prices tend to go up on a regular basis no matter how clean your driving record stays. I switched to a different company and later to a third company. Finally, GEICO sent me an offer that was better than what I was paying so I switched back. They still raise my rates once or twice a year, usually a couple of dollars/month for no reason other than they can. In a year or two, I will be changing to whichever insurance company beats their rate at the time. No doubt in a few more years, I will switch back to GEICO as they will be the cheapest in town.

A better solution for companies is to do things that encourage customer loyalty. They could offer better deals for customer loyalty. Give a good deal to new customers, but make better deals for long-term customers. In my post about Boost Mobile, Boost Dealz App from Boost Mobile Can Save You Money, I gave a good example of how they used to offer a great way to save money by using their Boost Dealz app. That was one way to encourage customers to stay with them. I could reduce my cell phone bill to $10.00/month in exchange for spending time doing things to earn credit. They decided to kill the deal so I switched to Unreal Mobile who offered a better deal, 50% savings, for the same amount of service.

Dad gave a discount to repeat customers as a way of showing he valued their customer loyalty.

Many companies offer incentives if you bring them new customers. Depending on the company, it may be a one-time discount for you and the person using your affiliate link. In other cases, a company makes it an ongoing discount where you earn a percentage of whatever the person spends on their site.

 

 

 

About ICT Genealogist

Originally from Gulfport, Mississippi. Live in Wichita, Kansas now. Let's collaborateDealspotr.com
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