The Psychology of Creating Repeat Customers for Your Business

Business.com / Customers / Last Modified: February 22, 2017

Repeat customers save your business valuable time & resources. Learn the psychology of how you can create highly engaged, repeat customers.

Apple. Netflix. Starbucks. Amazon.

Chances are, you've bought something from each of these companies within the past few years. In fact, I'd be willing to guess that you've made multiple purchases from every one of these brilliant brands. I know I have.

There are several reasons why I've bought multiple products and services from these companies, but what's important to note is that they have successfully made me a repeat customer and what's more; I'm happy about it.

These companies worked very hard to become habit-forming by nature, and as a reward, they can rely on getting a certain amount of revenue from me every year with somewhat regularity.

With Apple, I truly love the products. Netflix has excellent original content and has become almost the only form of television I watch. Starbucks is everywhere and is incredibly convenient, consistent and quick. Amazon carries almost everything (including the Kindle) at low prices and can ship it straight to my door in 2 days with Prime delivery. I'm still trying to figure out this equation in my own business, right now.

A few weeks ago, I had the pleasure of sitting in on an incredible class on this exact subject with Best-Selling Author and entrepreneur Nir Eyal. In this class, Nir shared with us the psychology behind how any business can maximize their ability to create repeat customers at every turn.

Ryan Robinson on Hooked with Nir Eyal on CreativeLive

That's me with Nir, above. We got to chat live in the class about how we at CreativeLive can increase engagement and re-purchase rates with our online education business. One of the most core concepts I took away from our conversation was the importance of always creating only the highest quality, results-driven content for our customers.

Even delivering an incredible amount of value isn't enough, alone. You have to give your customers a reason to come back for more on a regular basis.

"Today, just amassing millions of customers is no longer good enough," Nir says. "Companies increasingly find that their economic value is a function of the strength of the habits they create."

Repeat customers save your business time and resources. But most importantly, they give you the peace of mind to focus on creating the best products and services you're capable of.

How can we learn from the most successful addicting brands in the world, and apply the same principles they use, to our businesses?

Here are the two fundamental principles of creating repeat customers for your business. If you can master these, the sky is the limit.

Related Article: Couples Therapy: Tips for Improving Your Customer Relationships

1. First-to-Mind Wins

"A company that forms strong customer habits enjoys several benefits to its bottom line. For one, this type of company creates associations with 'internal triggers' in customers’ minds. That is to say, customers come to the website or store location without any external prompting," Nir shares.

Whether it's in the form of a Starbucks along your morning commute to work, or to flip on your favorite Netflix show every night because you love the way watching it makes you feel, these are prime examples of successful internal triggers.

"Instead of relying on expensive marketing or worrying about differentiation, habit-forming companies get customers to cue themselves to action by attaching their services to the customers’ daily routines and emotions. A cemented habit is when users subconsciously think, 'I’m bored,' and instantly Facebook comes to mind. They think, 'I wonder what’s going on in the world?' and before rationale thought occurs, Twitter is the answer. The first-to-mind solution wins," Nir says.

"Successful habit-forming companies attach their services to their customers emotions." - Nir Eyal

The same principle applies to how I shop for a new book. My first instinct is to head over to Amazon, pick up a Kindle book and begin reading from my Apple devices. I'm hooked.

Related Article: Under Promise, Over Deliver: The Must-Do's of Customer Retention

2. Manufacturing Desire

How do companies create a connection with these internal cues needed to form habits? 

The answer: they manufacture desire. 

As Nir illustrates, "fans of Mad Men are familiar with how the ad industry once created consumer desire during Madison Avenue’s golden era. Those days are now long gone. We are now a part of a world filled with distractions, ad-wary consumers and a lack of ROI metrics. The combination has rendered Don Draper’s big budget brainwashing useless to all but the most popular brands."

"Instead, the successful smaller companies today are manufacturing desire by guiding customers through a series of experiences designed to create habits. I call these experiences “Hooks,” and the more often customers run through them, the more likely they are to self-trigger."

Here's the Hooked Model Nir designed, to illustrate how the best businesses guide their customers through an experience of rewarding desired actions, and encouraging deeper investment.

Hooked How to Create Habit Forming Products

With my own online course business, my clients consistently come back for more content every time I release something new. I've applied some of Nir's principles of providing genuine value and carefully giving my customers a feeling of accomplishment so that they naturally want to keep coming back.

When your customers continuously experience the feeling of reward at the end of a desired behavior for your business, they'll begin to form internal triggers, which become attached to existing habits and behaviors of theirs. If you do this right, your customers will soon be internally triggered to think of your product or service every time they feel a certain way. In this way, the internal trigger becomes part of their routine behavior.

How will you create engagement hooks for your customers?

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