Is customer retention a key focus of yours? Download our customer retention strategies sheet to see what your eCommerce business is doing well. And, importantly, what you should do to keep customers returning…
So, you’ve made a sale. Nicely done. But, keep the champagne on ice…for now.
It doesn’t stop there. You want your customer to spread the word, refer their friends, sign up to your email newsletter, and buy more of your products. In other words, you want to keep them coming back again, again, again, and again.
But, let’s rewind. The first step to retain customers is to understand their behavior.
Let’s look at a customer retention eCommerce example for a skincare retailer. The retailer notices on social media a lot of their customers complaining about single use plastics in packaging. So, they take the time and source a supplier of biodegradable solution.
They communicate the switch to your customer via email, social media, and incorporate into their overall brand DNA. Their customers feel valued and understood and continue to shop with you. Ultimately, it’s the fact they understood the needs of their target customer which turned them into loyal customers.
Evidently, understanding your target customer’s preferences and behavior enables you to tailor the online shopping experience to suit their needs. Moreover, design your website, user interface, branding, product offering, and communication channels to suit their behaviour.
It’s more expensive to try and acquire new customers. In fact, acquiring a new customer costs five times more than retaining a new customer. In addition, the success rate of selling to a customer is 60-70%. Conversely, the success rate of selling to a new customer is only 5-20%.
In other words, existing customers are low-hanging fruit. Working on eCommerce customer retention is a priority for all online businesses. Let’s dive deeper and look at how to retain customers in eCommerce.
Providing accurate and detailed product information is key to unlocking customer retention. Let’s look at leveraging your product data to increase customer loyalty:
Include comprehensive and accurate product descriptions. Don’t skip on any details. Ultimately, clear and concise information will lead to informed purchases, reducing the number of returns. Customers will be confident in what they’re buying and will be more likely to shop with you in the future.
Make your product pages stand out with product content. This means, include high-resolution images with good lighting. In addition, provide images of the product in action, too. Lifestyle images help customers visualize how the product fits into their world. So, you want to make the shopping experience as memorable as possible.
Zoom and 360-degree views make the experience even more immersive. Remember, a picture speaks a thousand words!
💡Top tip: If your image includes a model, be sure to mention their height! Details like this make all the difference.
Providing comprehensive and intuitive size charts across product categories is key. According to Shopify, 52% of returns are due to incorrect sizing.
Ultimately, clear and accurate size charts enable customers to make informed decisions. In other words, this will drive loyalty by improving the overall shopping experience.
💡Top tip: More and more fashion & apparel retailers are incorporating virtual fitting tools. These enable customers to virtually test items. Not only does this further decrease the likelihood of returns, but it’s also pretty cool, too.
By providing customers with rewards, discounts, and/or exclusive offers, you encourage them to shop with you. In turn, your customer retention rates will skyrocket.
They’re also a great line of communication with shoppers. They’re a chance to interact with customers other than through transactions. For instance, you should send regular updates, news, and exclusive offers through these schemes.
With loyalty schemes, there are a few different options to consider. There isn’t one-size-fits all solution. You might even want to mix and match:
In this approach, customers earn points for every purchase they make. Over time, customers build these points to earn discounts, free products, early access to product launches, or special offers.
This system is widely used by eCommerce brands as it’s a great way to drive customer loyalty.
This format is hierarchical. Each tier provides more and more advantages and benefits than the one below. As customers gain more point through making purchases, they’re able to go up a tier.
This is a great way to retain dedicated followers and a customer base. Customers will return more frequently as they’re able to see the long term benefits of shopping with you.
Cashback rewards are a great customer retention example. The process involves giving a customer back a percentage of their purchase. This might be as cash – or credit!
For instance, say a customer purchases a $100 item from you. Because the customer is part of the cashback rewards program, they’re eligible to receive 3% cashback for the purchase (3% of $100). The amount is credited back to their overall cashback balance.
As they make more and more purchases with you, their overall balance increases. Eventually, they use the credit they’ve built towards purchases with you. The cycle continues!
With this system, customers remain loyal to your brand and choose you over competitors. Moreover, your business’ customer retention rate in eCommerce will soar.
This involves customers paying a recurring fee to join an exclusive program. Benefits will typically include free shipping, access to product launches, discounts, and members-only content. It’s convenient for the user and a steady revenue stream for the retailer.
However, they’re not for everyone. They’re typically seen across food and drink (beer, wine, coffee), beauty, and streaming services.
Referral schemes are a a great word-of-mouth tactic to get people talking about your products. By encouraging users to share referral links or discount codes, you not only drive repeat purchases, but help generate new business.
If a customer refers a friend, offer customers a percentage off their next purchase. Once their friend makes the purchase, they’ll receive the discount. Or, provide customers with loyalty points for every successful referral they make.
A recent study discovered referred customers have a 30% higher conversion rate. In addition, they have a 37% higher retention rate than leads from other marketing channels (social media/email marketing).
Here are the formulas to use for key customer retention metrics:
Referral Conversion Rate: (Number of referred customers who made a purchase/total number of referred customers)*100
Customer Lifetime Value: (Customer Value*Average Customer Lifespan)
Social media is an easy place to focus your customer retention marketing efforts the ideal place to build and engage with your community of shoppers.
Ideally, you should have a dedicated person or customer support team (depending on the size of your business!) to monitor and engage with any queries or concerns. Respond promptly to your customers to increase customer satisfaction and develop long-lasting trust. In addition, repost customers using/wearing your products!
Also, make sure it’s easier for your customer to find you. Avoid complicated usernames with too many numbers or numbers. Keep it simple; keep it consistent.
💡Top tip: Follow your customers back on social media. It’s a nice touch and keeps you on their radar!
From centralized and consistent product information, to omnichannel consistency, through to intelligent AI-generated product descriptions. Here’s how a PIM like Pimberly keeps customers chomping at the bit:
Interested in learning more? Click here to book a demo!
