Ugetgoal blog

Repeatable purchases: iPhone vs notebook

Strategy Why
For each business repeatable purchases could get lower spending on customer acquisition and, as a result, increase revenue. It's a desired scenario, isn't it?

Some businesses get repeatable purchases just because of customers' using the products. For instance, yoga studio. A new client buys a one-month ticket and interacts with the studio regularly. If that client likes the studio, teacher, schedule, etc, it mostly leads to repeatable purchases. The studio's owner doesn't need to make additional online marketing activities to convince that customer to keep doing yoga here. In this case, all focus should be on the first purchase and the quality of the product.

Another instance is an iPhone. The customer doesn't interact with the company, but the interaction with the product is enough, in this case, to make the same purchase next.

But if the customer uses every day a regular notebook, it doesn't lead to a second purchase for this notebook's brand. The same thing happens with dresses, restaurants, cosmetics, etc. But in each category, we can name at least one brand that is out of the logic above. It's Moleskin for notebooks, Gucci (for instance) for dresses, and a local family coffeeshop in an Italy town, where people go for years.

So what are the cause-and-effect relationships and how to define what you need for your exact business?

Let's see it for the notebook:

  1. Some people buy a notebook just for writing, they need just its functionality. For them, the main need is something to write on.
  2. Some people buy a notebook to belong to a social group. In some groups, if you don't use Moleskine, you are a stranger. Of course, they buy Moleskine only.
  3. Some people buy a notebook to show their's social status. The notebook positions you in society. They buy something that gives additional points to important values of an exact social group. It could be success, income, freedom, protestation, etc.
  4. Some people buy a notebook that gives them aesthetic pleasure. For them, the primary need is something beautiful.

There is one more factor — the difficulty of brand replacement. Changing the notebook brand is easy, but changing the smartphone brand is not so easy, because you already are used to it, you put your data into the cloud, you buy applications, etc. It's the same for medicine, psychologists, travel activities, etc.

Note that the fourth group could buy a notebook for a higher cost or longer delivery, which doesn't fit the first group. The third group could buy something they don't like visually, that doesn't fit the fourth group.

So you need to do additional marketing activities for making a repeatable purchase only in one case — if the customers use your product just as a function (first group).

In all other cases, you should put your most affords into matching the customer's needs through product use. Marketing activities should be secondary and not the main source for repeatable purchases.

If you build a brand, but it doesn't bring you repeatable purchases, it means your brand doesn't give the customers what they need in the realm.