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.

6 Top Content Ideas for Ecommerce Websites

When it comes to increasing online sales, you’ve likely heard and read a lot of recommendations about website user experience and how more content can help your website. But what kinds of content will help improve your visitors’ engagement and increase your bottom line? Here are some content ideas for ecommerce websites we’ve seen work for our clients.

1. Video

The number one content idea for your ecommerce websites to increase sales is to demonstrate your products with video. According to data from Think with Google, “more than half of consumers say online video has helped them decide which specific brand or product to buy.” Video can be leveraged for 360-degree views of products or to show how the product works and how to use it. Time lapse videos can show the results from your product over time. No matter what you sell, video is essential for your ecommerce website strategy.

2. Reviews

Just like word of mouth recommendations, product reviews add legitimacy and encouragement to prospective buyers, dispelling concerns and validating they are making a good purchasing decision. Given that there are innumerable review software and platform options, here are some of the top features you should look for:

  • Email reminders to buyers to leave a review after they have received the product
  • Verified buyer designations
  • Options to incentive reviews
  •  Integrations for Google Merchant Center, to show reviews in Google search, and to connect to your other systems (shopping cart, CRM, social media pages, etc.)
  • The ability for reviewers to include not just text, but also images or video

Use these tips to encourage customers to submit more user generated content.

3. Detailed Product Information

Often, content on ecommerce sites is too scant when it comes to basic details like dimensions, materials and ingredients. One of the best content ideas to increase conversions on your ecommerce website is to ensure you feature pertinent product information on your product pages. In addition, for products that have a range of extensions, parts and accessories, be sure to prominently feature those add-on options in close proximity to the product details in order to increase the chance of a cross-sell.

5. Charts and Tools

One very strategic ecommerce content idea is to guide website visitors on how to choose the best product for them with comparisons and tools. Outlines of product features in visual graphics and interactive configuration tools can streamline your sales process by outlining all the options and considerations buyers need to make to select the product that’s right for them, leading them right into a final decision and purchase.

6. Customer Support

As much as customers love the convenience of shopping online, they still have questions and want some of the same kinds of service available in a traditional retail space. That’s why FAQs, Live Chat, Virtual Try-On (or use of Augmented Reality features) and other support offerings are critical ideas for ecommerce website content. Think about your product catalog and what kind of support your visitors are most likely to need to create a friction-free online buying experience. Next time you hear about the importance of content for ecommerce website success, you’ll be prepared with the knowledge of the content types that will compel action and improve your conversion rate.

3 Uses for AI in Ecommerce

Do you see or hear the term “AI” and instantly want to bury your head in the sand? If you run an ecommerce business, artificial intelligence (AI) is not something you should be ignoring. And there are plenty of simple ways to incorporate AI in ecommerce.

Let’s start with savings, because they are quite significant. According to TotalRetail, AI could save retailers as much as $340 billion annually by 2022, with 80 percent of those savings coming from AI-enabled efficiencies in supply chains and returns processes.

And retailers are paying attention. A Capgemini Research study found the global annual amount spent on AI by retailers is expected to surpass $7.3 billion by 2022.

But which AI technologies would your ecommerce business benefit the most from? Here are three you shouldn’t ignore:

1. Personalization

What is the most important element when it comes to increasing online sales? Personalization. When it comes to benefits, however, those "similar products" AI-driven suggestions barely scratch the surface.

AI personalization software learns about ecommerce shoppers based on their search and purchase history, buyer demographic and previous transactions. This enables effective product recommendations like "You may also like."

Upselling is a serious business. When Amazon launched the "Customers Who Bought This Item Also Bought" upsell in 2006, their sales increased by 35%.

In a brick-and-mortar store, every customer sees the same products. As on an online retailer, you have the advantage of showing shoppers specific products relevant to them, which has been proven to increase sales. Make sure your ecommerce business has the AI tools to properly personalize your customer experience.

2. Predictive Marketing

Imagine if you could use your customers’ current and historical data to predict future purchases. That’s precisely what predictive marketing does. AI makes it possible by identifying correlations between your customers’ past purchasing behaviors.

For example, running your customer data through a predictive model can help guide your marketing strategy by anticipating their behavior and:

  • Pinpointing unhappy customers you’re on the verge of losing
  • Identifying happy customers who may be ready to buy

Predictive marketing can save you money by allowing you to focus on quality leads versus those with no clear intention to buy. AI, or machine learning, makes this possible.

3. Customer Service

While AI can’t completely replace people when it comes to resolving complex problems, it can still play a key role in customer service. Take chatbots, for instance.

Chatbots come in two types: simple and AI-focused. While simple chatbots can spot keywords in customers’ questions and respond with pre-determined answers, AI-focused chatbots can perform more sophisticated actions. They do that by using natural language processing and machine learning to mimic human conversation that sounds just like real people.

Ways chatbots can be helpful for ecommerce businesses include:

  • Added support during busy times of the year, such as holidays
  • To engage customers with a welcome message on your website
  • To answer easy questions and free up customer service staff for escalated issues

In fact, according to a 2016 McKinsey report, 29 percent of what customer service representatives do could potentially be automated. Chatbots can help your business increase sales while saving time and money.

Personalization, predictive marketing and customer service are just three areas with applications for AI in ecommerce. Ecommerce businesses can use AI for everything from mining social media data to optimizing logistics. It all depends on your organizational needs.

If you’re not using AI for your ecommerce business yet, now is as good a time as any to familiarize yourself with the technology. Identify the problems you’d like to tackle and consider what value AI could bring to the table. Start small and assess your new AI’s value before broadening its capabilities.

There is plenty of potential for AI in ecommerce. Take advantage of the technology and consider some of these simple ways you can incorporate AI in your ecommerce business.

10 Tips for Choosing an Ecommerce Name

It’s been a long time coming, but you’ve finally decided to launch an online store. Congrats! If you have your brand and domain names figured out at this stage of the game, consider yourself fortunate. For most start-up shops, this task can bring up unexpected challenges. There are, however, things you can do when a choosing an ecommerce name to nip those challenges in the bud.

Before you settle on a brand name, for example, always consider the domain name. There’s nothing more discouraging than finding the perfect brand name, only to find out the domain name is taken. And they must go hand-in-hand; your URL is how customers will find your store online. If your brand name doesn’t come up in searches, you will lose valuable customers, traffic and sales.

Your ecommerce name is also set in stone, so to speak. Remember in June 2011 when the online retailer attempted to rebrand itself as By November, the company had already started restoring the original Overstock name to its website and social media channels following customer confusion. Your ecommerce name is not something that can easily be changed. Make sure the one you pick works on all fronts.

Here are some tips to consider when choosing an ecommerce name:

Be unique. Don’t emulate a competitor. Naming your toy business We "R" Toys, for example, only highlights a lack of creativity. Plus, your customers will see through your tactics and think of your business as playing second fiddle to a bigger brand.

Get creative. Zappos doesn’t exactly scream shoes, but they’ve made it stick. Not only is it quirky, but it’s easy for customers to remember. Same goes for the brand Etsy, which sees 15.6 million monthly unique visitors. Choosing a creative brand name also increases the likelihood the domain name will be available.

Keep it short. Finding a single-word domain is like hitting the jackpot. Not only is a short domain name easy to remember, it’s also easier for customers to type into a browser. Try to keep yours under three words.

Check domain availability. There are a few ways you can check a domain’s availability. You can type the URL into search or you can search for the domain on a site like Whois Lookup. If the domain you really want is taken, you do have the option to buy it. But before you contemplate buying a pre-purchased domain:

  • Check what it’s currently being used for. Does it have an active homepage? If so, you may be out of luck. If not, you can offer to buy it by contacting the owner directly.
  • Consider what you’re willing to pay for it. Depending on the domain name, you could be shelling out anywhere from $200 to $200,000.

Choose the right extension. There are so many extensions, such as .com, .org, .net, .co, and .us. For ecommerce, we recommend choosing .com for your top-level domain (TLD), as well as the countries you will be targeting (grab .ca if your target audience is based in Canada, for example).

Check for trademarks. Think you found the perfect name? Make sure it’s not already trademarked. You’ll want to be able to trademark your own name to stave off copyright problems in the future.

Search social media. Make sure your new brand name isn’t already taken on social media platforms like Facebook, Instagram and Twitter. If the handles are available, don’t wait to snatch them up. You can always delete the profiles if your name doesn’t pan out.

Keep it simple, stupid. Leave out odd letter substitutions (think “sk8ter”), which will make your domain hard to remember. This includes hyphens. Most importantly, make sure your domain is easy to spell and pronounce. Pronunciation matters with more and more people using voice search.

The bottom line? You want your brand name to match your domain name whenever possible. This will make it easier for customers to find your ecommerce business by typing your name into a search engine, browser address bar or by speaking.

The experience can be a bit frustrating, especially when it seems every idea you have is already taken. Don’t be afraid to get creative with your brand name. Use an online brand name generator like Name Mesh to get more ideas.

Above all, be patient. Your brand name is one of the most important steps when launching a new ecommerce business. Getting it right will be worth it in the long run.

Direct Mail: Why It’s Still Relevant

Nothing feels more archaic in the post-digital era than direct mail. But you’d be doing your ecommerce business a huge disservice if you counted it out.

The Data & Marketing Association found that customer response rates for direct mail has increased 43% year-over-year. This might come as a surprise considering actual mail volume has steady declined since 2006. Apparently, fewer pieces of mail in the postal system means that less competition is seen in customer’s mailboxes.

And the generation most receptive to direct mail marketing? Millennials.

According to a report from the United States Postal Service (USPS), 47% of millennials check their physical mailbox daily. They also spend almost twice as much time sorting and reading their mail compared to other age groups.

So if you’ve been scaling down your direct mail efforts, perhaps it’s time to ramp them up again. Here are three reasons why:

Direct Mail Is Flexible    

Small budget? Try using postcards to keep costs down. Small companies can also include free samples. According to the Sampling Effectiveness Advisors, most consumers say they are more likely to buy a product after trying it. Coupons are also an effective way to recruit new customers. Overall, direct mail works for companies of all sizes and all budgets.

Direct Mail Feels Individualized

According to the USPS, as many as 55% of people are eager to read their mail. Seeing their name on a parcel only enhances the experience, which ultimately leads to more sales. If you’re going the direct mail route, we highly recommend personalizing your parcels.

Direct Mail Is (Perceived as) Trustworthy

According to the USPS, 82% of millennials view messages printed on paper as more trustworthy than digital ones. In fact, it’s believed consumers trust direct mail over email because of the unique way that paper-based advertising connects with the parts of the brain that influence how people feel and remember things. For example, a study by Canada Post found that direct mail marketing “requires 21% less cognitive effort to process” and “elicits a much higher brand recall” compared to digital media.

Another reason why you should use direct mail? Consider this: 50% of all email sent on a given day are spam. With consumers’ digital inboxes flooded with junk, a physical message feels like a welcome reprieve.

So while it may be tempting to focus your efforts entirely on online marketing, don’t neglect direct mail; it has earned a place at the omnichannel marketing table. Not sure where to start? Follow these direct marketing tips to maximize your return on investment.