Growing a local business is not easy – no one will tell you that it is. This article is meant to help local business owners understand the value behind customer engagement and how they can keep customers coming back to their local businesses.
Think Bigger – Lifetime Value Matters
Every local business owner is concerned with the never-ending effort to attract new customers. Too often though, this pursuit for new customers leaves little time or resources to best serve loyal existing patrons. According to a Bain & Company study, “60% to 80% of customers who describe themselves as satisfied do not go back to do more business with the company that initially satisfied them.” For a multitude of reasons, this is true, but none more than a lack of connection according to Founder and CEO of By Monday, Inc., Larry Myler. Customer satisfaction and loyalty mean nothing if the customer can’t remember who did a great job.
Getting satisfied customers to return completely changes the economics of local businesses- more so when those satisfied customers bring their friends. It also makes economic sense – it’s five times more expensive to acquire a new customer compared to a returning customer and by increasing customer retention 5% produces more than a 25% increase in profit. Why? Return customers tend to buy more over time, increasing their overall value to a local business as operating costs to serve them fall. What ís more, returning customers refer their friends!
Be Heard, but not Loud – How to Engage Customers
Text marketing and SMS open rates are as high as 98%, compared to just 20% of all emails. Social media continues to expand but the expense of influencer and campaign creation and management is typically too exhaustive for most local businesses. Moreover, 75% of people have suggested that they’d be happy to receive an offer via SMS – this is why 65% of marketers say that SMS marketing is a “very effective.” Needless to say, text marketing and VIP programs when combined with traditional media marketing and simple social media time and time prove to be effective and affordable.
“For most local and small businesses, we suggest no more than three text promotions per month. You want your customer’s attention but do not want to be annoying. We’ve found that 2 or 3 messages monthly to be the optimal number of messages to keep subscribers engaged while not being considered intrusive.”
Text-Marketing Case Study 1:
Fat Boy’s Pizza is a carry-out pizza shop in Newburgh, Indiana. They have 1,045 subscribers to their text marketing program and typically send out 2 to 3 text rewards to their loyal subscribers monthly. In August, they sent out a text that coincides with the kick-off of football season. It’s always sent at 3:30 PM and with this practice, their phone doesn’t stop ringing until they close that night. This annual campaign typically yields above 110 orders and daily records.
Text-Marketing Case Study 2:
The Old Fashioned Butcher Shoppe in Evansville, Indiana has 1,350 members in their Towny-powered text marketing and rewards program after just six months. In their 7th month, 476 check-ins were attributed to their loyal returning customers. And, with an average ticket of nearly $20, Old Fashioned Butcher Shoppe has created about $10,000 in attributable revenue from their most loyal customers.
Text-Marketing Case Study 3:
Honey Moon Coffee in Evansville, IN recorded 622 check-ins from their 950 members at their Towny-powered rewards program just after opening from COVID-19 shutdown. This translated to over $6,000 in expenditures from their loyal customers. And 25% of customers who returned to the shop, returned multiple times in that 30-day period, and typically within 48 hours of having received a text message.
Text Marketing provides local businesses with a direct, uncomplicated way to connect with customers and VIPs so they come back. Texts when combined with other traditional marketing tools is the cherry on top of the marketing-ice cream sundae. Text messages provide direct access to customers and have become the upper hand to big box stores and national chains competition. And for local business owners who want to stay fresh and keep their customers coming back, text messages are the answer.
Thank you for supporting local businesses!
Towny is a Business Development Service that provides Text Marketing and customized Loyalty/Rewards programs exclusively to locally owned businesses and is on a mission to increase local customer engagement and strengthen Local Living.