LOYAL CUSTOMERS VS NEW CUSTOMERS
Analyzing spend patterns to better customize promotions for your most loyal customers
A staggering amount of business is done before a sale is ever made. Between advertising, online reviews and regular promotions, businesses have an array of tools at their disposal to drum up sales. These methods are better seen as an investment in your business than a customer incentive. This, however, does require business owners and managers to ask themselves a significant question:
How effective are my promotions?
It can be a challenging question for many business owners. Indeed, you may lack the data analytics to properly answer the question in the first place. With so much to parse through, it can be overwhelming to figure out what kind of promotions to offer existing and new customers.
In this piece, we will show business owners how to analyze data to determine what promotions are working best for their business to increase their ROI.
For existing customers, consult the purchase history
When customers make their initial purchase at your store, a good approach to keeping them coming back is to ask them to leave their contact information. By collecting a simple name, phone number, or even just email, you can maintain steady contact with them, offering new promotions as they come out.
The beauty of this approach is the way that it interacts with the customer’s purchase history. For example, if a customer recently purchased a PS5, you now know that they will also need the materials associated with that system. This opens the door for you to send them email promotions on related items, such as:
Initial PS5 Purchase
This means that they are more likely to come through your doors than if you sent them just a generalized promotion. In addition, that attention to detail is likely to keep them coming through your door even after their PS5-related merchandise has been exhausted.
For new customers, inventory data is your friend
Newer customers are a bit more difficult to bring in, because you don’t know exactly what drives them through your door in the first place. There is no purchase history to reference, as there is with existing customers, which can lead business owners to feel as though they are flying blind.
What you do know, however, is what already is selling well in your store. To use the previous example, if you know that the PS5 is one of your most popular items, that may be a good indicator for what to run a generalized promotion on. This method only works, however, with comprehensive inventory data that highlights your biggest sellers. A good point of sale (POS) system will be able to provide you with the data and analytics you need to better understand these types of trends in order to more-carefully target future promotions.
Loyal customers vs new customers—why not both?
The beauty of these solutions is that they do not exist in isolation; there is nothing stopping a business from utilizing both methods (in addition to other approaches not covered here) to attract new customers and bring back old ones. In addition, centralizing these methods through your POS provides the quickest access needed to determine what promotions work best. Giving yourself this all-in-one access to sales data:
- Attracts new customers
- Brings back existing customers
- Keeps inventory moving and fresh
- Improves your bottom line
That being said, you need to make sure that your POS offers this information in the first place. POS companies like talech have been working with retailers and restaurants for over a decade, keeping customers coming back. Our cloud-based system provides 24/7 access to valuable data which helps determine what promotions work best for your operations. Reach out today about a free demo and to learn more about how it can become your trusted partner.