How do you make an existing eCommerce store more successful?
It’s a very good question, and one that many store owners approach the wrong way.
It’s all too easy to fall into the trap of relentlessly chasing new customers — 500 customers sounds far better than 400 customers, after all. And there’s nothing wrong with this approach really, as extra customers will bring in extra revenue.
However, it’s not the easiest way to boost your store’s profitability.
Savvy marketers have long realized that it is far easier (and cheaper) to persuade an existing customer to buy from you again than it is to find a new one.
This makes a lot of sense: existing customers are highly targeted, have already trusted you enough to hand over their money, and are familiar with the quality of your products. If their experience with you the first time round was positive, they have no reason not to buy from you again.
When you maintain a happy, loyal customer base, this will increase the lifetime value of each customer. For example, a customer making five separate $100 purchases would have a lifetime value of $500. This is far better than a one-off customer making a $150 transaction, despite the smaller transaction sizes. Knowing key metrics, like the lifetime value of each customer, will help you accurately set your marketing budget.
Today I want to discuss seven strategies to keep your existing customer base happy, and to boost a customer’s lifetime value by encouraging repeat purchases.
1. Customer accounts
Forcing customers to sign up for an account with you is a controversial topic. On one hand, you want your checkout procedure to be as frictionless as possible – forcing a customer to create an account adds friction. On the other hand, it encourages customer loyalty and will make for a quicker checkout in future.
So what is the best option here?
Personally, I think a mixed approach is best: offer a guest checkout and a member checkout.
However, don’t underestimate the importance of growing an email list. It’s one of the most cost-effective ways to get customers back to your website. With this in mind, giving them an offer they can’t refuse – for example, 10% off their first order – will push them towards creating an account, and handing over that email address.
Sure, you might lose 10% of your revenue from this first transaction, but if that customer buys from you again, this will more than cover that cost.
2. Subscription business model
Many eCommerce stores are waking up to the importance of a customer’s lifetime value. This has resulted in a new “breed” of eCommerce store: Product subscription stores.
Now, some eCommerce stores will implement product subscriptions alongside the traditional one-off transactions. For example, Amazon will allow you to buy groceries on a one-off or subscription basis.
However, some eCommerce stores take this one step further and build their entire business around a product subscription model.
Take, for example, a website selling fresh coffee. When someone buys from this shop, they know three things about that person: they like coffee, will drink the coffee, and, at some point, will need more coffee.
In such a scenario, doesn’t it make sense to give the customer the chance to automatically replenish their stock of fresh coffee on a weekly, bi-weekly, or monthly basis? It’s super convenient, and lazy consumers will be more than happy to subscribe so that they never run out of coffee, and to avoid the hassle of having to shop regularly.
3. Innovative product range
One of the best ways to get consumers rushing back to your website is to offer them something they can’t find elsewhere – if they want a particular product, or a particular combination of products, the only place to get them is from you.
Of course, this is particularly tricky in the eCommerce world where it seems there is competition for everything – if you don’t produce your products in-house, or you can’t arrange an exclusivity deal from suppliers, you’ll just have to accept that you won’t be the only supplier.
However, that doesn’t mean you can’t be unique; you’ll just have to get creative.
This could involve choosing your suppliers more carefully to ensure there is minimal competitor overlap. Or you could specialize in two seemingly unrelated products that just work together: off the top of my head, premium men’s skincare products with top-end whiskeys for the executive gentleman – you heard it here first!
4. Customer loyalty scheme
Of course, if you’re trying to encourage customer loyalty, having a dedicated loyalty scheme in place seems obvious. However, it’s a trick that many eCommerce stores are neglecting.
If you reward customers for shopping with you by giving them points towards money off vouchers, this provides a great incentive to keep shopping with you. If a customer’s head is ever turned by a competitor’s store, they will remember the loyalty bonus they have been working towards, and this is often enough to bring them back through your virtual doors.
If you’re using WooCommerce, there’s a dedicated add-on for this very purpose – called WooCommerce points and rewards. The add-on allows you to define how many points each transaction is worth, and what level of discount these points equate to.
It might seem a little pricey at $129 for a single site license, but if it can help you consistently bring your customers back, it will pay for itself in no time.
This strategy is strongly linked to point 1: if you can persuade a visitor to sign up for an account with your store – or even just to subscribe to your mailing list – you can market directly to their inbox. Often just the act of receiving your email will put your website at the forefront of that customer’s mind, and this will result in more sales – which is exactly why advertisements work.
Let me provide a real life example, away from the world of eCommerce. One of the trashy UK television shows I watch has recently been sponsored by a well-known pizza company. Despite wanting to eat healthily, every time I see this advert a seed is planted in my head: “I actually would like a pizza!” This has caused my pizza consumption skyrocket, despite previously thinking I was immune to the lure of advertisements.
Your newsletter can have this exact effect, making it an effective form of advertisement. You can use the newsletter to inform customers of new product lines, exclusive content, and promotions. However, the biggest impact is often just from putting the thought into a customer’s head that they need new shoes, guitar strings, eye liner, or whatever else it is you’re selling.
Sending out a newsletter is easy to implement, cost effective, and one of the most effective ways to drive sales.
6. Win back inactive customers
By effectively monitoring your customers’ buying habits, you can extract maximum lifetime value from each customer. Perhaps the best opportunity is to win back an “inactive” customer by encouraging them to buy from you again – this strategy is one of the best ways to turn a one-off customer into a repeat customer.
I’m sure we’ve all received one of the “We miss you…” emails after buying from an online shop once and then failing to follow up on this custom. These will usually say something along these lines: “because we value your custom, we would like to offer you an exclusive 20% off your next purchase.”
I must admit, I’m a sucker for these emails, and find the opportunity to get a discount outside of the usual promotional periods too good to miss.
There are a number of services that offer this feature, including Remarkety eCommerce email marketing service. You can also use automated email marketing to reach out to customers reaching the end of a product’s lifespan, who are likely ready to buy again, turning a one-time sale into a repeat sale.
If your email list is small enough, you could even consider monitoring things manually.
7. Exceed customer expectation
The easiest way to persuade a customer to buy from you again is simply to blow them away with the whole buyer experience. If you exceed a customer’s expectations, they have no reason to ever buy from anyone but you.
Of course, this is far easier said than done. However, there are a few things you can do to keep your buyers consistently happy:
- Free gifts – small samples, for example
- Highest quality products
- Top notch customer service
- Hand written thank you note
- Stylish packaging
- One-day delivery
- Exclusive discounts
- Acknowledgement on birthday – free gift or birthday discount
There’s nothing ground-breaking in that list, but your customers will love you if you can do all these things consistently. Everyone knows customer service and quality is important, but how many consistently go above and beyond to deliver on this?
Customer service isn’t cheap – it will cost you to provide free samples with each order, and it takes time to hand write a note – but it really is one of the best ways to attract a loyal following. Consider the expense an investment which will yield a positive return when your customers come flocking back to you.
If you run an eCommerce store, make sure you stay focused on the most important metric of all: your website’s bottom line.
Don’t get me wrong, the number of customers your website attracts is an important metric. However, it’s also a vanity figure that some webmasters will chase relentlessly, despite there being easier “wins” available. Because it is generally easier and less costly to encourage an existing customer to buy again, this is an area you should focus a substantial portion of your time, effort, and resources.
Never underestimate the importance of cultivating a happy, loyal set of customers to bring in a more reliable revenue stream each month.
Do you have any strategies for encouraging repeat custom for an eCommerce store? Let us know in the comments space below!
The post Happy, loyal customers: How to retain eCommerce customers appeared first on Torque.