The Importance of Customer Retention in Ecommerce

The importance of customer retention in ecommerce is widely talked about, but are you making it the priority you should? If you know that the cost of new customer acquisition is far higher than the cost to retain existing customers, why not implement a concerted retention strategy?

Your ecommerce business’s customer retention is directly impacted by not only your product value, but also your adherence to best practices for experience and satisfaction. Here are three tips for customer retention in ecommerce:

  • Customer Rewards Based on Longevity and Volume: Nothing creates the opportunity for long-term, repeat buying better than offering ongoing rewards (via points earned, volume discounts, status tiers, etc.). Customer retention rewards can be based on past purchases, subscription discounts, amount purchased, buyer “anniversaries,” and existing-customer promotions. By incentivizing purchases from business you’ve already “won” you remove the unpredictability of prospecting and focus on adding value for reliable buyers.
  • Gratitude Perks: The value and importance of ecommerce customer retention you place for your business will be most tangibly demonstrated to customers when you pass it on in acts of gratitude. You can send unique and innovative emailed thanks even to first-time buyers to help gain their loyalty. In addition, depending on your product make up you may want to make it standard practice to extend birthday acknowledgement in email with an offer or discount, first purchase “anniversary” acknowledgement, bonuses for friend referrals, free samples, and other thank you gifts and perks. Even order reminders (e.g., your 30-day supply runs out soon, reorder before it’s too late) can be a welcome service perk for today’s busy consumer. Appreciation and acknowledgment are surefire ways to make buyers feel important and valued and help retain them long term.
  • Online Tools & Services: The better your website experience and the easier you make it for customers to find what they’re looking for, to reach a support representative, or to self-serve for common tasks, the more likely they will be loyal to your brand. What separates poor user experience from great experience are the steps and processes (seamless or difficult) that brands make common tasks like online return requests and processing, finding and reviewing account information, making edits to recurring deliveries, etc. The easier these things are for your users the more likely they will keep coming back and buying. Maintaining a positive image in ecommerce is key.

The 80-20 rule of thumb applies to ecommerce retention just as much as any other industry. If the vast majority of your sales will come from only 20% of buyers, catering to those buyers is essential to retaining them. With the right offers and service, your ecommerce customer retention will increase, which will improve your ROI and allow for greater forecasting accuracy.

4 Benefits of Customer Satisfaction Surveys

How much do you know about your buyers and what they think about your products and your website? If you could know more, would that be valuable for your brand? Ecommerce experiences lend themselves seamlessly to collecting information from your visitors that can be used to improve your website, products, marketing and sales.

Here are some of the benefits of customer satisfaction surveys:

1. Product Improvements and Expansion

Many ecommerce sites rely heavily on reviews to collect insights into what consumers think about their products. The benefit of customer satisfaction surveys is that they are guided vs. open-ended, so you can elicit more exacting details from your customers.

With a survey you can pinpoint specific areas you want to learn about and formulate those into questions to expand your product line or improve current products. For example, what if you are considering offering new colors or flavors of certain products? You can include questions about the popularity of those new options in your survey. Or, what if you would like to expand an existing product line to include offerings for other demographics (e.g., children)? You can survey customers on whether they would also be interested in purchasing the product for their children.

Surveys give you the ability to leverage website visitors and customers for free or low-cost (you can offer incentives for people to participate) product research and development.

2. Website Upgrades

Your website features and offerings can also benefit from customer satisfaction surveys. Imagine you want to design and launch a new product-oriented blog. You have some options:

1. You can invest in creating the new blog, hire writers, deploy it on the website and then track results to see what your website visitors think.

2. You can survey your website visitors about your blog idea, confirm they are interested and dig deeper into the kinds of topics they would be interested in reading about before you invest any time, money or other resources into creating the blog.

While not necessarily a perfect science, surveys are a great opportunity to collect feedback on website ideas you have before you act.

3. Conversion Rate Optimization

Since surveys are completely customizable, why not use them to get to the heart of the matter and learn about your audience’s behaviors directly? What inspires them to buy and what would get them to buy more--or sooner? The top benefit of customer satisfaction surveys is learning what motivates your buyers to choose your brand and products and to use the data to increase conversions.

Following are some ideas of questions than can help in this vein (these should we multiple choice questions with answer options, including “other” with open comment space):

What makes you most interested to buy XYZ product?
When do you think you are likely to buy XYZ product?
Would any of the following (offers, incentives, etc.) make you buy XYZ product today?
What are your top concerns when comparing options before purchasing XYZ product?

4. Demographic Data

Many brands invest a significant amount of resources into market research in order to help determine the best ways to advertise and market their products. Customer satisfaction surveys can benefit your brand by allowing you to collect key demographic data, which can help you construct a blueprint of your target audience. You can better tailor the messaging on your website and in your marketing with those demographic details. The only flaw in relying on this data is it doesn’t help with expansion into new markets. However, if you are confident in the targeting of your current buyers and you just want to increase overall marketshare among them, then a survey is a great way to pinpoint exactly who your customers are.

Customer satisfaction surveys can benefit your ecommerce company in a range of ways and are relatively easy to deploy via email marketing or with software on your website. Given their ease of dissemination, you can create numerous surveys over time and offer them to different visitors and buyers (based on behavior or randomly) to increase ROI from your website.

5 Packaging Insert Ideas for Ecommerce

You have order fulfillment down to a science and have hired a 3PL to handle storing, picking, packing and shipping your products. But your customer’s journey doesn’t end with order fulfillment. If you’re looking for a way to maximize your buyers’ unboxing experiences while driving customer loyalty and sales, we have a suggestion: packaging inserts.

THE BENEFITS OF PACKAGING INSERTS

Unboxing doesn’t have to be the end of the road in your customers’ purchase process. Think of it as the start of a different journey. In fact, selling to an existing customer is a lot easier than selling to a new one.

Let’s look at some customer retention statistics:

  • The success rate of selling to an existing customer is 60-70 percent. The success rate of selling to a new customer is 5-20 percent.
  • Increasing customer retention by 5 percent can increase your profits from 25-95 percent.
  • About 80 percent of your future profits will come from just 20 percent of your existing customers.

The reason it’s easier to convert existing customers is simple: they have already purchased from you, which makes them easier to retarget in your remarketing efforts. A well-targeted packaging insert will not only make customers feel special, it will increase brand loyalty too. There are many ways you can incorporate them into your customers’ unpackaging experiences.

PACKAGING INSERT IDEAS

Thank you notes: Add personalized thank-you notes that will make an impression with your customers. Don't say “Thank you for your order” which can make your customers feel like statistics. Show your customers you value their support rather than their business. Opt for "Thanks for choosing us" instead.

Promo codes: Give your existing customers a reason to make another purchase by including a promo code with an exclusive discount as an incentive. Don't forget to track and measure your ROI. Create campaign-specific promo codes to measure how many people redeem the code and how much they spend on each transaction.

Offers: Offer free shipping on their next order. Everyone loves free shipping, especially if it’s exclusive to them. Not only will this offer incentivize your customers, it’s also an effective way to minimize buyer’s remorse. “I didn’t really need that, but I had free shipping, so…”

Feedback: Ask your customers to write a review of their purchase. Customers who write reviews tend to develop a loyalty to that business because it gives them a voice in the online purchasing process. The easiest way to get customers to review your product? Just ask.

Free samples: Product samples are technically packaging inserts, so consider adding a free gift along with purchases. Your customers will be delighted at the idea of getting something unexpected for free. It’s the principle of reciprocity in marketing. When you offer your customers something helpful for free, they will feel indebted to you.

Packaging inserts can improve your brand perception and boost your marketing reach. They are also a cost-effective way to drive customer loyalty and sales. Personalize them, and you’ll be on your way to maximizing your buyers’ unboxing experiences.

3 Best Practices to Better Your BOPIS Retail Strategy

Thanks to fierce competition in the retail world, consumers have more and more options when it comes to shopping. And whether it’s online, mobile or in-store, both ecommerce and brick-and-mortar retailers have diligently stepped up their games to keep up with new demands.

One option still gaining popularity is buy-online-pickup-in-store (BOPIS). According to a report by Adobe Analytics, BOPIS increased 50 percent over the 2018 holiday season. But effective BOPIS retail strategies have proved somewhat challenging for retailers. What makes click-and-collect so tricky to execute?

There are several components that can trip up a BOPIS strategy, including inventory inaccuracies, communication, and execution.

However, there are best practices you can use to better your BOPIS retail strategy and improve the consistency of your service offering.

TRACK YOUR INVENTORY (ACCURATELY)

Today’s fulfillment options mean many moving parts for omnichannel retailers. Things can get especially tricky when online customers shop for products specifically marked as available for BOPIS. Imagine, for example, two customers add the same item to their online cart, but your store only has one of those items in stock. Come checkout, one of those shoppers won’t be happy – you’ll likely lose a sale, and possibly a customer.

This is why as a retailer, you need to implement real-time cross-channel inventory tracking and order fulfillment to keep your inventory as up to date as possible.

Inventory that isn't carefully tracked and managed can create big problems down the road. Make sure to incorporate best practices into your day-to-day inventory management. It is crucial to the success of your BOPIS retail strategy.

SWEAT THE DETAILS

If not everything you sell online is available for BOPIS, be clear about it from the get-go.

Enable your online customers to set their store location and add a filter that gives them the ability to shop for products that are only available for in-store pickup. Be sure to promote your filter at the top of your product pages; you want shoppers to know if they can pick up their orders in-store before they begin shopping.

Once your customer places a BOPIS order, communication is key. Send an immediate confirmation and include order details, clear directions on where to pick up in-store, and what forms of identification are needed.

NAIL YOUR PICK-UP PROCESS

Are you placing your BOPIS pickup points at the back of your store to seduce customers into buying more stuff? Don’t. Instead, make it easy for your customers to retrieve their orders by placing your pickup location at the front of your store. Use clear signage or even consider curbside service to designated parking spaces. Remember, your customers don’t want to feel manipulated; they chose your BOPIS service because they want a quick and convenient online shopping experience.

Another important factor in the pick-up process is to make sure your staff has the information they need to make your customers' BOPIS experience a good one. They should be able to retrieve orders quickly and know how to handle potential problems such as returns. Or consider having dedicated staff specifically for your BOPIS orders. Either way, proper staff training will help ensure a successful BOPIS strategy.

Do you even need a BOPIS strategy? What if it’s just a fad?

According to a Signifyd survey, millennials' shopping preferences are what’s driving the need for BOPIS. And despite its implementation challenges, BOPIS is here to stay. If you’re a retailer wanting to make the most of this shopping experience, make sure you understand and follow BOPIS best practices.

Continue Creating a Great Customer Experience, Even After Checkout

The experience that shoppers have with your ecommerce brand isn't limited to interactions with your website. It continues offline through the product fulfillment process – including how an order is packaged, the condition of the items in an order, and efficiency of the returns process. While your direct control over shipping and handling is limited during the last mile, there are a few things you can do before packages leave your warehouse that will go a long way toward giving customers a delivery experience that makes a good impression.

Right-Sizing

In a Harris Poll survey (funded by packaging manufacturer, Sealed Air) of more than 2,000 U.S. adult consumers, 66% believed that an item’s packaging tells them something about how much the brand cares about them. From excessive or messy dunnage (like Styrofoam peanuts) to small products in oversized containers – when customers are left to do the dirty work of cleaning up all that wasteful material, their experience with your brand suffers. Customizing your packaging to an optimal size can not only help create a better brand image in the eyes of your customers, it can reduce shipping and materials costs over the long-term.

Damage protection

In the previously mentioned survey, 59% of consumers believed that retailers and carriers are equally responsible for damage to a product that was ordered online. By right-sizing your containers and using the latest in dunnage technology, you can better protect your shipments and spare your customers the disappointing experience of waiting for an order, only for it to arrive in less than mint condition. Additionally, since customers are more likely to place the blame on you if your products arrived damaged, strive to work more closely with your carriers and/or 3PL provider to find solutions for reducing damaged inventory.

Handling Returns

By mastering reverse logistics, you can minimize the cost of the returns processing and recoup lost profit from the returned product. But more importantly, customers love a smooth returns process, so your customer satisfaction can increase as well. Remember: Every return is another point of engagement with your customer. It should reflect the same focus and attention to detail as every other part of the customer experience. Once you assure a customer that your returns process is easy, then you eliminate hesitation from the next purchase and convince them to shop with you again and again.