How Sticky are your Customers?
Buyers love Sticky Customers!
Repeat customers are what every business owner wishes for, and what buyers will pay a premium price to own! However customers can be fickle. Here's how to make them sticky.
In traditional businesses, when a customer buys your product or service once, it’s up to you and your team to provide them the experience and value that encourages them to buy again in the future. However, in a subscription business, you replace the random buying relationship with an automatic purchase, giving your business an "automatic customer." The automatic customer agrees to purchase from you in the future, as long as you keep providing the service or product you’ve promised them.
A subscription business conveniently and reliably provides its customers something they want or need on an ongoing basis. Subscription businesses might provide a product, a service, or a combination of both. The product might be a tangible product, such as water filters, shipped directly to a consumer three times a year. Or, it might be a product combined with a service, such as a technician delivering and installing the new water filters, while at the same time conducting routine maintenance of your water filtration system. Both provide a business owner with sticky customers, ones that will never need to call your competition and be more likely to call your business when they need other products or services you supply.
Our lives are filled with subscription purchases! Take a moment, look at your own life, and do a quick count of the agreed upon recurring purchases you make. Phone, internet, news feeds or newspapers, online storage of photos, book or audio subscriptions, lawn service, snow removal, trash pickup, diaper delivery, wine-of-the-month, dog doo removal, access to unlimited content such as videos, books or carpentry how-to content. The list is endless and, with just a little imagination, most every business can figure out a way to create a recurring relationship with their customers. Simply put, subscriptions make life easier and more enjoyable for consumers. For business owners, subscription relationships equal sticky relationships that can predict future revenues.
Integration Drives Stickiness. Almost any business can identify a method to have a subscription relationship with their customers. Knowing your customer’s needs, as well as their fears and desires can help you identify a product or service your business can provide automatically.
Beyond the simple convenience of automatic service, subscribers become even more loyal when they start to integrate their subscriptions into their daily lives. Subscribers knowingly enter into an agreement in which the convenience of uninterrupted, automatic service is exchanged for their future loyalty. Rather than buying once without returning, subscribers stick around—hopefully for years, which is why subscribers drive up the value of your company so dramatically.
To see how your business performs on this and the other seven factors that drive your company’s value, take 15-20 minutes and complete the Value Builder Questionnaire.