52% see repeat business as major driver of profitability

QUESTION – how do I maximise repeat business and referral rates?

THOUGHT – reinforce emotional decisions

A recent study found that 52% of businesses identify repeat business as the major driver of profitability. In the same study, only 45% of businesses considered new customers to be the primary driver of profitability.

As noted in earlier THOUGHTS in this series, repeat business and referrals are not just an important source of revenue but represent an even greater driver of profitability. This is particularly significant in light of the potential for lower cost of customer acquisition and higher average spend.

A proven strategy for encouraging repeat business and referral involves thanking customers for each and every purchase and reinforcing their purchase decision.

While a ‘thank you’ at the point of purchase is important, it is often not enough. With significant purchases it is prudent for a senior member of your team to contact the customer directly and thank them for their business.

This contact can provide a valuable opportunity to investigate the customer’s experience and gather data to help fine-tune the customer experience, identify opportunities for repeat business, and encourage referral. Surveying customers in this way demonstrates to them that they matter and that their business is valued. It can also provide an opportunity to drive future conversion, referral, and repeat business.  

Some businesses, including BMW, use customer contact post-purchase to reinforce the purchase that has been made – helping to ensure that the customer feels good about the purchase and providing reasons for repeat purchase and referrals.

BMW reinforces each customer purchase, providing facts that support the merits of that decision. In so doing BMW:

  • Ensures the purchaser feels as good as possible about the purchase they have made
  • Provides the purchaser with facts that can be used to support an emotional decision

 A customer who feels good about a purchase will be more likely to refer and buy again.

Given that many purchases, including the purchase of expensive luxury motor vehicles, are largely emotional, providing the facts after the purchase helps the purchaser to rationalise the purchase in their own mind and to others. This enhances satisfaction and increases the likelihood of referral.


Thank your customers for the purchases they make and while you are doing it, ask a few questions that can enable you to fine-tune the purchase process and encourage referral.

Help purchasers rationalise their purchase, providing, after the fact, the information needed to justify personally and to others, thus encouraging referrals and repeat business.


Super Office, Shaun Buck, Saasquatch, Hubspot, ShareSomeFriends, Journal of Marketing, Nielsen, Texas Technical University, INC and Customer Experience Insight

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