Money Management

Want to boost sales for your small business? Don’t just focus on finding new customers — read on to learn how to keep more existing customers. [[{“value”:”

Often in small business marketing, the focus is on selling to new customers. It’s true that getting new business is exciting and fulfilling; it always feels great to land a new sale or launch a product in a new market. But one of the most important ways to make sure your business succeeds for the long term is not just selling to new customers — it’s keeping your existing customers.

Customer retention is a sometimes-overlooked strategy for small business marketing. After all, it’s easy to find small business marketing software that promises to help improve sales and find new customers. But where’s the customer retention software?

Let’s look at a few big-picture ideas for what customer retention means for your small business, and how to make more money just by selling to the people who already know and love your product or service.

Customer retention for small businesses: What it means

Customer retention is a measure of how many customers you keep. A high rate of customer retention means that your customers are loyal and likely to keep making repeat purchases over the long term. Higher customer retention rates can mean lower costs of marketing and advertising for your business. That’s because (according to HubSpot data) it can cost five to 25 times more to find, persuade, and close the sale with a new customer than it costs to keep an existing customer happy.

Businesses are always going to have a certain amount of customer turnover, or “churn.” No business keeps 100% of its customers; sometimes people will decide to stop buying your product or stop buying from any companies in your industry or vertical. Sometimes businesses lose customers through no fault of their own, or for no reason at all.

But if you can get more precise, targeted, and strategic about understanding why your customers keep buying from you, you can improve your customer retention numbers — and boost your sales.

Customer retention strategies for small business

Big corporations have made a science out of customer retention. They have entire teams dedicated to it — studying the data about repeat purchases, conducting customer opinion surveys, analyzing why people decide to keep coming back (or not), and encouraging people to buy again and again.

Small businesses don’t need the same level of intensity and complexity as corporate customer retention strategies. But there are a few simple ways your business can do more to boost customer retention.

Ask your customers how they feel about your business

How often do you ask your customers, “How are you feeling about everything, how are things going, how was your experience on your last purchase?” Depending on what you sell or the size of your business, this kind of customer feedback doesn’t have to be time-consuming or formal. But make sure you take time to have those conversations. Every small business owner needs to be in constant dialogue with customers — listening more than you speak.

Collecting customer feedback can be as low-tech as using old-fashioned comment cards printed on paper. But a tech-enabled way to get customer feedback is by using customer surveys. There are tools like SurveyMonkey, Intuit Mailchimp, and Google Forms that let you quickly create surveys and collect insights from your customers.

Don’t overburden your customers with too many survey questions. But surveys can be a great way to find out what your customers really think — and identify problems or customer service disconnects that could cause people to stop buying from your business.

Launch a customer loyalty program

Airline frequent flyer programs are a form of customer retention strategy. Airlines and their credit card partners want you to keep buying plane tickets from their companies, not from competitors.

Your small business doesn’t need to have big corporate resources to launch a customer loyalty program. Think about how you can reward your best customers. What’s it worth to your business if someone keeps coming back to spend thousands of dollars with you so you don’t have to go out and market, advertise, and win a new customer to get that money?

Simple, low-tech punch cards at restaurants are one example of a customer loyalty program — “buy nine lunches, get one free.” You could also get more creative by offering exclusive events to your best customers. Or get personalized with a thoughtful gift or surprise discount to your most loyal customers, based on what you know about their preferences and what they love to buy.

Dedicate (some) of your marketing to customer retention

If you’re using small business email marketing software, you can turn this into a tool for customer retention. Not all sales emails should be focused on new customers or new sales. Many of the customers on your email list have likely already purchased from you. Is your email marketing speaking to their needs and concerns, or are you just blasting out sales pitches intended for new audiences?

Look for ways to weave in some customer retention messaging into your overall marketing. “Here’s a gift for our favorite long-time customers” or “We appreciate your business and would love to do more…”

Bottom line

Customer retention is often underappreciated as a small business strategy, but it can save your business big money on customer acquisition costs. If the economy slows down or your industry goes into a downturn, customer retention becomes even more important — keeping good customers is cheaper than finding new ones.

Customer loyalty programs, customer surveys, and understanding why your customers keep doing business with you and why they might leave (or stay) can all help you boost retention and increase sales.

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We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. The Motley Fool has positions in and recommends Alphabet, Intuit, and Target. The Motley Fool has a disclosure policy.

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Are you curious about getting airline elite status? Here’s how most of the perks can be had in other ways, without all the effort and expense. [[{“value”:”

Airline elite status is an often-misunderstood and polarizing topic within the frequent flyer community. If you want to earn more frequent flyer miles, get free (or discounted) airline tickets and upgrades, and otherwise get more out of your air travel experiences, you might think that having elite status would be a ticket to a rarefied world of comfort and ease.

The truth is more complicated. Many air travel experts are debating whether making extra effort to chase elite status is still worth it. Airlines have cut back on some elite status perks in recent years, and have changed the rules for elite status in ways that can be confusing and customer-unfriendly.

I personally do not have elite status with any airlines. So maybe I’m just jealous. But based on my research and my life experience as an airline customer, I’m not super impressed by the offerings of elite status programs.

Let’s look at a few reasons why airline elite status might be overrated — and where you should spend your time, energy, and dollars instead.

1. The rules for elite airline status are confusing

Every airline has different rules, brand names, and specific terminology for how to get elite status. To its credit, Southwest Airlines has one of the most customer-friendly, easy-to-understand elite status programs: just take 10 round-trip flights, and you’ve got status!

But most other airlines bombard you with fine print and legalese. You have to rack up a certain number of qualifying flights, but not every flight qualifies. Or you can earn qualifying “points,” but these points are not the same as frequent flyer miles, and also not the same as credit card reward points.

Airline elite status programs also have multiple tiers, like, “Silver,” “Gold,” etc. — but the tiers are also confusing. You get certain benefits with each tier of status, and the perks get sweeter as you climb the status ladder. But the overall effect of reading about elite airline status on the airlines’ websites can often feel exhausting and discombobulating, rather than inspiring.

None of this makes me want to grab my credit card and start strategically spending and booking flights. It mostly makes me question whether the effort is worth it at all.

2. The perks have gotten less generous

You might think that having elite status with an airline would guarantee you a wide range of VIP perks, like airport lounge access. But airlines have been cutting back on lounge access, even for elite status members. If you want free lounge access, the easiest way might be to have the right (higher-fee) premium travel credit card, not just elite status.

And if getting access to in-demand perks like the airport lounge is only based on which airline credit card you have in your wallet, why bother chasing elite status at all? You don’t have to fly dozens of times per year. You might as well just focus on which travel perks you want, and choose travel credit cards that give you those perks.

3. Some perks are irrelevant to my interests

If you really sit down and read the list of perks and benefits offered by each tier of airline elite status program, they become less impressive. Yes, elite status gives you some nice benefits like eligibility for free upgrades and multipliers of your frequent flyer miles, so you can earn more miles more quickly.

But most of the rest of the perks feel pretty flimsy to me. I don’t need a free checked bag; I travel light. (And even if you want a free checked bag, the best airline credit cards can give you that perk — no elite status required.) Do you really care about priority boarding? Is it worth thousands of dollars for you to get to stand in a special little line and sit on the plane for an extra 30 minutes?

Are these mundane status signifiers supposed to make people feel like their lives are more valuable than the rest of us commoners who are sitting in basic economy? Whatever makes people happy, I guess. But I’d rather just get a cheaper plane ticket and choose my own perks, a la carte style!

Bottom line

If you already fly so frequently that your miles and your status-qualifying achievements are piling up without you even realizing it, elite airline status could be worth getting. But I don’t see the point of working too hard or making extra effort to pursue status with airlines. The rules are complicated, and most of the best benefits can be achieved in other ways. Instead of chasing elite status, just choose the right travel credit cards.

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We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool recommends Southwest Airlines. The Motley Fool has a disclosure policy.

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The cost of auto insurance can vary based on a number of factors. Read on to see what those are and how you can take steps to save. [[{“value”:”

When you buy a car, you have to factor in the cost of more than just your monthly auto loan payments. You also have to make sure you can afford gas, parking fees (if applicable to you), and maintenance.

And then there’s auto insurance. Depending on your situation, that cost could be a huge budget buster.

In fact, rate data from CarInsurance.com finds that New York is the ninth-most expensive state for auto insurance premiums. And you may be shocked to see how much some drivers in the state are shelling out for coverage.

Will insuring a car in New York cost you almost $16,000 a year?

CarInsurance.com reports that the average cost of auto insurance in New York is $2,020 a year. But the highest reported rate in the state is a whopping $15,851. The lowest rate, by contrast, is $468.

You may be wondering how on earth there could be such a huge discrepancy, and how it could possibly be that some drivers in New York are paying close to $16,000 a year to insure their cars. But the answer boils down to the way insurers establish rates.

The cost of your auto insurance will generally hinge on factors that include:

Your driving record and experienceYour car’s make and modelYour ZIP codeThe extent to which you use your vehicle

If you have a history of moving violations (such as speeding tickets or accidents), that could easily drive your auto insurance costs up, because insurers will see you as more of a risk. You might also pay more for car insurance by virtue of being an inexperienced driver.

Furthermore, the more expensive your car is, the more it’ll cost to replace. So if you buy a $120,000 vehicle, you might pay thousands more to insure it than someone with a $40,000 car.

Meanwhile, insurers will take your ZIP code into account because if you live in an area where there’s a lot of crime, it could translate to more risk on your insurer’s part. Similarly, you can expect to pay more to insure a car you drive to work every day, whereas you might get a discount if your car isn’t used daily, but rather, only on occasion.

How to save money on auto insurance

Even if you’re not paying anywhere close to $15,851 for car insurance, it still pays to take steps to save money on it. And one way to do that is to drive safely.

Avoid moving violations that could add points to your license and drive your insurance costs upward. And if you have moving violations on your driving record already, see if your insurer will allow you to take a defensive driving course to reverse some of that damage.

Furthermore, if you’re in the market for a new car, consider buying a minimal-frills vehicle rather than an automobile with all of the bells and whistles. Those features may not only result in higher auto loan payments, but also, higher insurance costs.

Finally, if you work from home or otherwise don’t drive often, make sure your insurer knows that. Better yet, see if your insurer (or another insurer) offers a pay-per-mile program you can sign up for. This won’t automatically be a cheaper bet, because these programs still have you paying a base price for coverage, and from there, you’re charged for every mile you drive. But if you truly don’t drive much, it’s worth looking into.

The reality is that if you’re a New Yorker with an average car, you’re probably not looking at a $15,851 bill. But even if your auto insurance premium is considerably lower, it still pays to do what you can to whittle it down.

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We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.

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Airline elite status programs can be confusing, expensive, and, dare we say…overrated. See how to maximize your air travel without elite status. [[{“value”:”

I am a future part-time digital nomad and I love travel rewards credit cards, but I’m not super-impressed by the rarefied realm of airline elite status. Every airline has a frequent flyer program, and elite status is like a special VIP room within that larger airline fan club. If you get elite status with an airline, you can qualify for some special perks.

Some airline elite status benefits are valid and valuable, like free upgrades to business class or an automatic multiplier to help you earn more frequent flyer miles on every flight. But some of the other airline elite status perks are underwhelming, especially when you consider how hard and expensive it is to earn elite status in the first place.

Some airlines’ elite status programs (like Southwest Airlines) are more customer-friendly than others. But in general, most require you to take sometimes dozens of flights or spend thousands of dollars on airline credit cards. You have to follow hard-to-understand and ever-changing rules. You have to painstakingly amass enough elite status-qualifying points which are (usually) different from frequent flyer miles and also (usually) different from credit card reward points. Feeling confused yet?

And for all that effort, you get…a free checked bag? Sorry, but I’m not impressed, airlines!

Here are a few elite status benefits that I feel are overrated — and how you can have a better travel experience without the elite trappings.

1. Free checked bag(s)

One of the first benefits that airline elite status programs advertise on their websites is a free checked bag. It’s true that many airlines have recently raised their fees for checked bags, and not having to worry about this fee can save you some money.

But also, I don’t check bags. I’m passionate about traveling light. Even for a month-long international trip, I always manage to pack everything into one single carry-on bag. I don’t need a free checked bag. And I definitely don’t need two or three checked bags that you get for higher levels of elite status.

You know what elite status perk would actually make me happy? Free automatic gate-checked bags! Just let me check my bag at the gate and pick it up on the jet bridge immediately after landing when I get off the plane! I’m happy to save room in the overhead compartment, and I don’t have to worry about my bag getting lost or waiting in line at the baggage claim! Please, airlines! Give the people (me) what we really want!

2. Priority boarding

Airline elite status programs also make a big deal about priority check-in and priority boarding. Not to be disrespectful, but yawn. I don’t care about being the first one on the plane. Do people actually care about this? Do you enjoy being ushered into some special little check-in line? Does it make you feel like a big shot? Oh well.

I don’t want to be first on the plane, even if I’m sitting in business class. I don’t want to spend any extra time with minimal leg room, breathing jet exhaust, while dozens of people trudge through the aisle, nearly bonking me in the face with their huge carry-on bags (that should’ve been gate-checked).

And if you have a free checked bag (see No. 1 above), why do you even care about being first on the plane? You don’t need to scurry onboard to grab space in the overhead compartment! Just spend a few extra minutes sitting in the ample leg room of the airport terminal, where there is no jet fuel exhaust.

To me, true VIP status is when you’re the last person on the plane. Being the last person to get on the plane, even if I’m sitting in the undesirable seats at the rear, next to the lavatory, feels like being the President of the United States boarding Air Force One. (I may have issues.)

3. Drink vouchers

Some airline elite status programs offer free drink vouchers. But only once you reach a higher level of elite status — not even the lowest tier. (Oh yeah, I forgot to mention the tiers — most airlines have several confusing tiers of elite status membership, like Silver and Gold and Platinum.)

Doesn’t this start to feel kind of ridiculous after a while? You spend thousands of dollars and fly hundreds of thousands of miles, and maybe, if you’re lucky, if you’re a “Gold” elite status customer, the airline gives you a free in-flight drink? At this point, I’d rather buy my own drinks.

What to do instead of chasing elite airline status

Most of the best airline elite status perks can also be obtained in a more personalized, do-it-yourself, a-la-carte manner. Just use travel rewards credit cards and airline credit cards:

Want a free checked bag? Airline credit cards can give you this perk.Want free or low-price upgrades? Pay for them with credit card points.Want a free drink? Some airline cards offer discounts on in-flight purchases like food and beverage — it’s not free, but you can earn miles with every snack or beverage you buy.

Bottom line

I love air travel and I’m excited to earn more points and miles with travel rewards credit cards. But I’m not super inspired by the benefits offered by airline elite status programs. If you truly are a frequent flyer and you can rack up enough flights or credit card spending with your favorite airline, then elite status might be worth having. But I don’t intend to make any special effort to chase after these humdrum perks…unless they start offering free gate-checked bags…

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We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.JPMorgan Chase is an advertising partner of The Ascent, a Motley Fool company. The Motley Fool has positions in and recommends JPMorgan Chase. The Motley Fool recommends Southwest Airlines. The Motley Fool has a disclosure policy.

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