Why are your loyal customers loyal to you?
The two most important reasons are the relationship with the person behind the counter and the service which they receive. But whilst this may have a lasting impact with some, many will stray over time and try new things. It is human nature after all to hope that the grass may be greener on the other side.
Over the past two years, we've purchased a lot of vape shops in the UK. Those with electronic loyalty schemes offered us a wealth of data on consumer behaviour. For instance, one of the things we learned early on is that only 15-20% of "loyalty" customers remain loyal. By which we mean having purchased anything within the past financial quarter. The business may have been doing well overall or at least as expected, and so no one bothers to examine the boring statistics to see where the business could be doing better.
But we love statistics and this one was a shocker. What was even more shocking was how true it held in pretty much every shop we purchased.
The solution was quite simple.
We know that e-liquid is the bread and butter of a vape shop, followed by coils (and accessories), and finally hardware which earns the lowest margins.
Once we began introducing our own ranges of e-liquids in to these shops, we started to see upward movement in customer loyalty. We continued to draw customers in with the 3rd party e-liquids that they've always had but our staff would have each customer try a few of our house liquids each time. At first it didn't have much of an impact on turnover as we were simply moving a customer from one product to another, but as we started to see our loyalty figure rising to over 30%, we started to see a marked increase in turnover as well.
It's simple. Better margins and better customer loyalty.
For very little investment, you too can start stocking a range of your own in-house e-liquids. The risk is negligible and the rewards could be massive.
Please have a look at our white label services and get in touch if you'd like to find out more.