Acquiring new customers simply isn’t enough for your ecommerce business. You need to be able to retain these customers if you want to achieve your sales targets and beyond.
Retaining an existing customer is always cheaper than finding a new one, which is why you need to create a strategy to master the subtle concept of customer retention.
Increasing your customer retention rate means increasing customer loyalty. It also implies that since you invest less on these returning customers, every purchase they make is, therefore, more profitable.
Customer retention should be a significant priority for ecommerce businesses - even a 5% increase in retention can increase profits by 25% to 95%.
You can adopt a number of tips and tricks to increase customer retention and ascertain the number of returning customers. The following nine customer retention strategies can help you connect with your customers and help nurture the customer journey.
Instead of starting from scratch with new customers, your time is better spent on learning the game plan below to increase customer retention rate.
Email marketing is one of the most remarkable ways of engaging with existing customers. Once customers have already made an investment in your company, email is the best way to stay in touch. You can start by creating an email list of your most frequent customers.
Email customers when they make a purchase, simply to say thank you and show appreciation for them shopping at your ecommerce store. Personalized emails are more likely to be opened and you can also use emails to share information on promotions and sales. You could also email around holidays and birthdays with personalized offers.
To save time, and more importantly, money, email campaigns have evolved from creation by old-school CRM systems cluttering dusty office spaces and now utilize email marketing automation. Saving on both personnel and money, email marketing automation is the ace up your customer retention sleeve.
Customer Loyalty Programs
Customers respond to incentives. If your product or service hasn’t won your customers’ hearts quite yet, you need to start offering further benefits. Initiate a customer loyalty program to reward returning customers. Reward programs are a great way to make genuine relationships with customers.
Retention programs are effective in increasing purchase frequency, as they encourage customers to make repeat purchases in exchange for rewards. You may find this a slightly outdated way to increase your customer retention rate but it’s a tried and true method to increase loyalty among customers.
Your retention strategy could include the following customer-centered loyalty programs to retain customers:
- Lifetime membership
- Discount coupons
- Exclusive deals
- Cashback offers
- Gifts for bulk purchases
- Points on every purchase that can later be exchanged
Personalize the Experience
You should already have your customers’ entire purchase history available in your database, paving the way to personalize the customer journey based on their past purchases. And providing you with the opportunity to recommend offers based on products they’ve previously bought.
You should also personalize any communication with customers, whether by email, SMS, or on-site messaging. When it comes to contacting customers, you need to sound like a human and not a faceless business to create a sense of familiarity and warmth.
Stay in Touch
The art of building long-term relationships with customers cannot be overstated. Shooting out a simple “Happy Birthday” email or “Happy Holidays” SMS is perfect for giving customers a reminder that your business still values their custom.
Check in on a regular customer who has gone a few days without making a purchase or visiting your website. While we’ve discussed emails as your primary strategy, your call center staff can also contribute greatly to encouraging new customers to your website, highlighting any new products or current promotions.
Whether it’s to inform you about a special offer, a birthday greeting, an invitation to a seminar, or just to simply say hello, call your customers. A phone call will always be more personal and intimate than emails.
Use power dialers if you have a high volume of customers to contact daily. It can automate the process of making calls and make life easier for your customer service team.
Optimize the Website for UX
UX refers to User Experience, or how your customers feel when they interact with your ecommerce website. You need to hire a UI (User Interface) and UX designer to help you optimize your website to improve customer experience. Customers might not return to websites that are hard to navigate and not user-friendly.
There are unlimited ways to optimize the UX of your website, but let’s list the most important ones that can impact your customer retention rates:
1. Your site should be easy to navigate
2. Your check out process should be hassle-free
3. Use exit pop-ups, these reduce cart abandonment rate.
4. Make sure your forms have a minimal number of fields
5. Your site needs to be highly responsive. Nothing frustrates a customer more than slow-loading websites.
6. Ensure your site is optimized for mobile
7. Quality dynamic content and clear CTAs can also increase retention.
Social Media Marketing
Meet your customers where they are. People spend a great deal of time on social media websites and a robust social media presence is mandatory for every ecommerce business. With an online store, you need as many opportunities as possible to engage with your customers. Social media sites provide ample opportunities to connect with your customers in real-time.
Being active on social media will increase your company exposure and it’s also a great way to offer customer support. You can engage with your customers on social media and they can engage amongst themselves and share positive things about your brand.
There are a number of ways to increase reach and engagement on social media. You can choose to post content and organically reach your customers, or you can opt for paid ads. There are also a bunch of handy social media management tools to ensure you stay on top of a scheduled social media content strategy.
Offer Exceptional Customer Support
A brand needs to know the importance of customer experience and how to capitalize on it. Perhaps the most important strategy to retain customers is to give them the support they need, when they need it.
Naturally, your products and services need to be of the highest possible quality but if you want to retain your customers, your customer care services also need to be top-notch.
Once a customer trusts your after-purchase customer support, they’ll often return and buy from you once again. Not many customers tolerate incompetence in the customer support department, and nor should they.
Delight your customers with fast responses. The quality of your brand is directly proportional to how fast you respond to customers. So, ramp up your call center average speed of answer and make customer support available via live chat and social media.
Implement Cross-Selling Strategies
The oldest trick in the book is to sell a customer a product and have them return to buy something that complements the original purchase, like a camera case for a camera. This is called cross-selling. You need to ensure your customers return to buy products related to their original purchase.
You could send them an email recommending such products to draw attention. Cross-selling strategy needs to take advantage of people’s impulse purchases. You need to go through your sales catalog and data to find out what items complement each other and promote these to customers who have bought them.
Provide more Return and Delivery Options
While ecommerce is enjoying its heyday and people are buying online more than ever, the hassle of returns and delays in deliveries can make people wary. Everyone wants their online shopping to be delivered as soon as possible, so you need to offer timely deliveries.
One-day shipping is being offered by many online retailers - something to consider if you want customers to return for further purchases.
The Bottom Line
Customer retention is an ongoing process, but the important thing to remember is that satisfied customers will always return. Implement the strategies listed above and keep working on them to get a sustained customer retention rate and increase your customers’ lifetime value.
Customer retention can have a marked effect on your growth and profitability just like customer acquisition. It can also have a powerful impact on the value of your marketing plan. The above strategies can not only help you craft an efficient customer retention solution but also indirectly increase customer acquisition.
Delight your customers with exceptional customer support, a personalized experience, and reward them with loyalty programs. Every department in your business should be focused on retaining customers. You need to strive for continuous improvement and you’ll find your customer retention rate increasing, slowly but surely.
Bio: Grace Lau - Director of Growth Content, Dialpad
Grace Lau is the Director of Growth Content at Dialpad, an AI-powered cloud communication platform and one of the industry-leading VoIP phone systems for better and easier team collaboration. She has over 10 years of experience in content writing and strategy. Currently, she is responsible for leading branded and editorial content strategies, partnering with SEO and Ops teams to build and nurture content. Here is her LinkedIn.