Building a brand is about both new customers and old customers.
While attracting new customers is essential for business growth, retaining and nurturing existing customers is equally important for long-term success. Here's why both aspects are crucial:
Acquiring new customers is vital for expanding your customer base and increasing market share. By targeting new audiences, you can tap into untapped markets, generate fresh leads, and gain new sources of revenue. Effective branding strategies can help attract new customers by building awareness, creating a positive perception of your brand, and showcasing unique value propositions.
Retaining existing customers is equally important as they provide ongoing business and can become brand advocates. Loyal customers not only make repeat purchases but also recommend your brand to others, which can drive word-of-mouth marketing and attract new customers. Building strong relationships with existing customers through excellent customer service, personalized experiences, and loyalty programs can increase customer satisfaction, encourage repeat business, and foster long-term loyalty.
A balanced approach is necessary to ensure that your brand caters to both new and old customers:
Focus on New Customer Acquisition: Develop marketing strategies that target new customer segments and generate leads. Leverage digital marketing channels, social media, content marketing, and advertising to reach and engage with potential customers. Clearly communicate your brand's value proposition and differentiate yourself from competitors to attract new customers.
Prioritize Customer Retention: Implement strategies to nurture existing customers and build strong relationships. Provide exceptional customer service, personalized experiences, and loyalty rewards programs to incentivize repeat purchases and foster customer loyalty. Regularly communicate with existing customers to maintain engagement and address their needs and concerns.
By striking a balance between acquiring new customers and retaining existing ones, you can build a strong and sustainable brand that continues to grow and thrive over time. Both customer segments contribute to the success and longevity of your brand, and it's essential to invest in strategies that cater to the needs of both groups.
For a brand to be good, it needs to make a promise that’s meaningful, differentiated, easy to learn and easy to understand – and then it needs to fulfill that promise every time.
A brand that doesn't make such a promise won't earn new customers. And a brand that does make such a promise but doesn't deliver on it every time will not keep its old customers.
Brand is the relationship between your business and its audience. Some of that audience is new customers. Some of that audience is old customers. Your brand provides that unifying clarity that will delight people regardless of where they are in their journey with your business.
Having said that, there is often more air time given to brand awareness building, getting new customers, than to fostering loyalty among old customers. So although I contend that brand serves customers across the journey stages, I want to spend a couple moments just talking about brand's role in fostering loyalty.
Brand sets the groundwork for loyalty. The math for a lasting, vibrant business only works if that business not only has new customers coming through the door, but also has old customers that are loyal and have a high willingness to pay and will recommend this brand to others.
Businesses with low customer churn have better profits than do their peers with higher customer churn. So to make that math work, pinpoint the thing that means a lot to your target audience and that you alone can deliver on. That will create value across the stages of the journey for customers who are just learning about you through the customers who have already paid for what you offer.
Uniquely bringing a big benefit to your customers will inspire their gratitude and that will keep them engaged with your business for as long as you're bringing that value to them.
Take Starbucks. We gladly wait in line for that $5 on a cup of coffee because we get so much value for that $5. Starbucks brings a big benefit. Good coffee, uplifting atmosphere, a great place to connect with people. It's this consistency that you can count on.
This fills a deep need and provides meaningful value to customers, which spurs their loyalty. It makes them a customer, not just one time, but countless times.
Do you over-index on lavishing love on new customers at the expense of old customers?
Remember: a brand that creates enduring value nurtures relationships with customers regardless of where they are in their journey with your business.
Lindsay is a Brand Strategist and Founder of Ironclad Brand Strategy, which builds brands using an exacting and analytic method. Her background as a P&L owner at Clorox fostered a deep appreciation for the executive charge: to create sustainable value. Ironclad advises companies from burgeoning startups to national corporations, including Zulily, IMDb, T-Mobile and Starbucks. Lindsay holds an MBA in Business from the University of California Berkeley, Haas School of Business.