(Untitled)

Intention to retain customers is a key objective for any company -- but in the competitive online marketplace, this might remain an ideal target. E-commerce stores are in fierce competition because their rivals aren't further away, they're only an easy mouse click away.

Now, the issue is: When was the last time you reviewed your customer retention programs and re-engagement plans? If you've been awhile (or in the event that you don't even have one) it's opportunity to establish solid connections with the soon-to-be returning customers of yours.

What exactly is retention of customers?

So what exactly is customer retention? What makes retention of customers crucial? Customer retention is referring to efforts to keep your customers engaged in order to keep them coming back for future purchases instead of contacting an alternative.

The customer retention strategy A customer retention strategyis focused on fostering customer relationships to build long-term value through repeat purchases. It is characterized by a strong customer experience, continual communication, steady quality of products, as well as ongoing marketing and education efforts for consumers.

Coca-Cola isn't announcing so that consumers are exposed to their products for the first time; they market to preserve their brand's good name and their loyal customers (and in order to stimulate cravings and boost the frequency of purchases).

But what makes optimizing for higher customer retention so crucial to running a business?

The advantages of keeping customers

It's often difficult to convince customers to purchase their initial purchase. Because the costs of acquiring customers can be so expensive, it's not uncommon that firms don't earn profits on their first sale. Only when a customer comes back after a second or third visit that they become a profitable client for the business.

You might think that, if a first-time shopper enjoys a positive customer experience and is convinced of the value in your offering then they'll return next time they have a desire. This is certainly possible. But how do you know if they won't have another need for the next six months? Or six months?

In the absence of strategies to retain customers implemented, customers could get enticed by your competitor or simply forget about the name of your company and buy from the first place they see.

Greater profitability

If it takes $10 to acquire a new customer and an average sale is worth a gross profit of $5, the transaction will not be profitable until the third purchase. This is a fairly typical scenario for e-commerce, and that's why retaining customers is crucial. In reality, it's cheaper to market to previous customers than to acquire new ones. So turning a one-time customer into a ten-time customer is where all the cash is.

Better customer relations

In a sense certain loyal customers "work" for your brand. Satisfied customers are happy to recommend your product to others. This publicity -- or "word-of-mouth-advertising" -- is incredibly valuable. Happy customers might naturally, or by a slight push, recommend your business through social media platforms or produce User-generated Content (UGC) you can use for future marketing campaigns.

No matter how it manifests the improved relationships with your customers will do nothing but help your company moving forward.

Marketing that is more cost-effective

If you want to market to customers with no connections to your brand you have to use the blanket approach of one size fits all to ensure that your message strikes the right chords.

If you're marketing to current customers, you have additional benefits of contact information, likes (previous purchases) and dislikes (returns or negative reviews) as well as other information.

If they've subscribed, you can reach right the customer via messages, email, or social media. Based on their the purchase history of your customers, you can suggest similar items they may enjoy. If a customer has left an unsatisfactory review of one of your products, you can (and ought to) respond to the critique in a positive way and offer a discount for their subsequent purchase.

In addition, by creating the pool of buyers who will stay with you for a long time and generating a pool of long-term customers, you'll get a better understanding of what top of the funnel initiatives to acquire customers result in the most profitable customers. Perhaps sponsoring ski and surfing events lead to new customers. However, the ones who are acquired through surfing events last double the amount. In the next year, you can triple your money spent on surfing sponsorships.

However, before you start developing strategies to improve the customer retention rate for your ecommerce store, you have to learn what's working -- and what's not.

Where do you begin, and how do you need to measure?

What metrics for customer retention matter most?

To begin improving customer retention you must know your current performance based on real customer data. How do you determine your customer retention? The most significant indicators of retention for customers comprise:

Repurchase rate

This is the main element of retaining customers. The repeat buyer rate looks at the percentage of customers that return to purchase at a minimum twice. The measurement of the repeat buyer's rate is one of the best strategies to measure the success of your retention methods for customers.

There are a variety of measures and it's possible to get lost in details of the figures, calculating repeat buyer rate is relatively straightforward. In order to determine your repeat customer rate, all you have to do is to know:

1. How many customers have purchased more than one item within the timeframe they specified?
2. How many unique customer (not buy orders) were you able to serve in the same period

Just divide the number of customers who've purchased more than once by how many new customers you've had during the same time period:

  The number of customers who purchased more than one item  

____________________________________________________________________________

  The number of customers who are unique  

Frequency of purchase

How often do customers come back for subsequent purchase? This measure is significant due to the fact that it's repeat customers who contribute to your annual sales per product or line.

The calculation of frequency of purchase is similar to finding your repeat buyer rate. Utilize the same time frame in the repeat purchase rate calculation and then divide the total sales during the period by the number of unique customers you had.

  Total number of orders  

  ______________________________________  

  Number of unique customers  

Average order value

For you to better know the effect of increasing your customer retention rate It is also possible to determine the average order value for your business. So, you'll know whether you're able to increase the number of customers who make a lifetime of purchases between one and four for example, how much this is worth. This will also help you determine how much time or effort you'll need to invest into strategies to make it happen.

For this figure to determine this value, you simply need to divide your entire revenue by the number of orders. The best way to calculate this is to perform this over a longer interval of time (such as the last twelve months) to get the most accurate average.

  Annual revenue  

     ______________________________________    

  Percentage of transactions processed  

Customer lifetime value (CLV)

Improving customer relationships is an essential element in boosting the retention of customers. All of your efforts could be summarized in a single metric -- CLV, also known as customer lifetime value. The CLV measurement will tell you what each of your customers currently -- and will have (if all else stays the same) can be worth.

Here's the reason these other measures were first introduced: to calculate CLV, you must know the average frequency of customer purchases as well as the mean value of each purchase. Multiply these two figures for an accurate, in-the-moment information on how your strategies for retaining customers and marketing campaigns are working:

 The average frequency of a customer's purchase divided by average value per purchase = customer lifetime value

Rate of churn

Some customer data metrics are positive. Churn rate is an indicator of how many customers stopped from doing business with your company during an elapsed time. This is most often employed by companies that sell subscriptions, memberships, or other ongoing service or product agreements.

Customers may cancel a subscription from you for any of a number of reasons, including unmet expectations, or finding similar offerings to those you offer at a cheaper price.

Sometimes, though, you may lose a customer due to no fault of your own. It could be that you've fulfilled their needs or their circumstances have changed so that your products don't meet the needs of the customer.

Whatever the reason, regardless of the reason, you will be churning. That's okay. Your goal should be in controlling this measure to the extent it's possible.

In order to calculate the rate of churn:

1. Consider the number of clients you had at the time of your period.
2. Take the number of customers that you will have at the conclusion of the time
3. Divide the result (the number of customers that you have lost) by the amount of existing customers you had at the beginning of the month.
4. Then multiply the results by 100 to arrive at the churn percentage.

We're now ready to learn more about keeping customers satisfied, loyal, as well as making them return to your online store.

The top ten ways to retain customers

Once you have the statistics in hand, you can now set out to improve retention to make this your most profitable year to date. More than enacting customer loyalty programs or providing outstanding customer service. You need to consider the customer experience from beginning to end. These are 10 proven methods to improve customer retention.

1. Provide the highest level of customer service -- always

This is first of the top priorities for a reason. There are many companies struggling to provide good service If you can succeed then you'll be in the forefront of the rest of your competitors. Your clients will thank you. They'll be satisfied, appreciated, and relieved that you've made their life less stressful instead of difficult. They'll return to you for even more.

This is what great service does. This is done by paying attention to the tiny aspects.

Here are a few basics of customer service that can set you apart:

Be reachable

Provide multiple ways to communicate like phone, email, online chat for example. Make use of as many channels that you are able to make available where and when your customers require you. This will not result in overwhelming your service reps.

Be attentive to your existing customers and respond

Answer questions, alleviate anxiety, and solve problems. Avoid alienating the loyal customer base by disdaining them.

Be knowledgeable

Training your employees so that they know the business and your products from top to bottom. There's nothing more frustrating to a client having a problem with their product than talking to an "customer service representative" who doesn't know their own products and services. Exceed customer expectations by first focusing on employees.

Concentrate on user experience

Distribute surveys to customers. Hire user testers and act upon their opinions. An app or website that's frustrating to use does you no favors when it comes to customer retention.

People who are unhappy with their customer experience tend to go to other stores, however, if you make an effort to meet their requirements and make the right changes and please your customers and they'll be more likely to return but help spread the word to others.

There are other ways to show your customers that they are important to you:

Offer user accounts

Users can view order status, monitor the status of their shipments and much more via their own dashboard. The ability to make information accessible allows you to provide proactive support. Instead of having to pick off the phone, go through their email inbox, or converse with a robot valued clients are able to take things into their individual hand.

Provide ongoing customer support training

It shouldn't be a singular thing that happens in the first few months of employment It is a continual procedure. It helps to ensure that each employees are supplied by the knowledge they require for success.

Think about a tool for managing customer relationships (CRM) tool

A CRM simplifies the complete customer service process by compiling all of your customer information in one place. Effective tools enable you to engage shoppers through every step of their customer experience.

With, for instance, Jetpack CRM, you can view the detailed profile of your clients, including information like purchase information and purchase history. You can also develop segments and advertise to every one of them based on their characteristics such as needs, wants, and behaviors. This helps reduce customer turnover and improves customer satisfaction.

Make it easy for customers to start a return

2. Give your customers a reward

Let your imagination run wild here!

As an example, let's say you've developed a segment of customers who have made at least five purchases through your online shop, and you'd like to give them a reward. Instead of stating something like "save 30% off when you spend $100 or more," say "save $30 on purchases of more than $100."

That way, however far above $100 the discount is still just $30. The higher the amount they spend and the higher revenue you can earn over that limit.

This type of discount will boost the average size of orders but without generating as much revenue Your customers will be grateful for the offer.

3. Always follow up - whether it's good or bad

If someone makes a purchase at your store's online e-commerce site Don't forget to thank the purchase.

Communication is everything!

If a customer asks you an inquiry, you should answer them. Then follow-up to ensure that your response solved their problem. The effort you put into this can exceed expectations of the customer.

Speak to nearly anyone, and they could tell you tales of times when they bought an item, asked questions but never received an answer. Even if the customer is really dissatisfied, they'll be able to tell that you have succeeded in communicating.

4. Send segmented emails

The segmentation of messages based on the buyer's actions is a type of personalization. This is like keeping track of the customer's narrative with the help of your brand and it shows your customers they are valued by the details and will go to a great extent in keeping customers.

Find and categorize contacts that tend to be drawn towards certain categories of products. Based on the category it is possible to identify some other aspects that might be true about them. If they are always buying through your "kids" categories, there is probably a child in their lives. They will enjoy offers and content related to children. Begin to talk with every one segment about pertinent items, the most common issues and ways to fix them (even if it doesn't involve any of your products) advice, tips, how-to content as well as more.

If your email messages are highly personalized interesting, pertinent and relevant, you're building a solid client-to-customer relationship.

When you separate your messages according to product categories You can be more specific, be more relevant to every customer, and assist in keeping customers. This is an excellent customer retention strategy when you begin to use it regularly.

5. Gamify and reward

Have you considered asking existing customers to suggest to family members and friends? If they're satisfied with their purchase with their purchase, they're eager to share their latest find with loved ones. Tapping into this network helps you expand your reach organically.

Referrals from friends and family are usually better than ads because people trust those they know. Referrals are like a five star review on the power of rockets. It increases your authority and also spreads awareness for the benefit of.

You can also use the add-on to promote your offer to refer friends on the checkout page as well as in follow-up emails.

6. Request customers to write reviews or post testimonials

If an individual takes the time to list the reasons they love a certain product or brand, it can affect their opinion regarding the business behind it.

By writing reviews and testimonials on your products that you sell online Your customers strengthen their connection with your company.

Infrequently send emails to customers asking for customers to submit public feedback. And to make it easy include links to most popular review websites that are appropriate to your particular niche.

7. Provide the highest quality perks and bonuses

Fast delivery is another perk which customers appreciate. One of the benefits buying products on the internet is that, even if there isn't the instant gratification that comes with buying something at a physical store, people are content to wait a day or so for their goods to arrive.

The faster your delivery is, the more reputable you are and the more often clients will look to you for the services you provide. Just make sure there are no conditions attached to benefits. This will be a huge delight for your customers, and you're able to ensure that they'll continue working with your company.

8. Provide a subscription tier

It's hard to beat recurring revenue. In terms of increasing your customer retention rate, subscriptions connect customers to you better than any other method. They are bonded with them. They become a part of your life.

If you're creative almost any company is able to develop an option for subscriptions to help you retain clients.

• Themed snacks
• Vitamins
• Coffee
• Lawn treatment
• Software licences
• Online magazines

Image from https://thebiltongfactory.co.uk/

Usually, this requires choosing additional services and benefits that are available only when you sign up for a subscription.

Biltong Factory Biltong Factory is an excellent model of a classic eCommerce store, offering subscriptions to boost customer loyalty. The store offers free shipping for local customers, discount offers, and additional communications. The small added costs of shipping and discount are worthwhile for the brand's increased customer satisfaction and to improve customer retention. It is a fact that members will have higher customer lifetime value than non members. It's not even close.

In other words, you can blend your customer service strategy into your subscription strategy to improve retention.

9. Consistently communicate

This is another chance to be a winner against your competition with just simple, consistent action. Have you thought about the idea of a blog for your website or newsletter that includes helpful tips and techniques for using your products?

Allow customers the opportunity to join your newsletter or blog and give them a reason to join -- every person who subscribes is extremely valuable to your company.

Send out regularly, biweekly, or even monthly email messages. Also, send out a few postcards or a mailer. Make quarterly printed catalogs available depending on the needs of your company. Yes, print. In light of the digital age the public is taking a look at print media with renewed interest this week.

Certain communications promote products or offers. But a lot of your customer communication and marketing is designed to stay in their thoughts. It is possible to send all kinds of helpful content like tips on using your products, how-to guides and solutions to issues that your customers have, answers to common questions, and more.

What's more important is that when you are in the forefront of minds and your clients are aware about you the first.

10. Make sure you say thank for your kindness!

Then we conclude with the simplest and most apparent customer retention technique of all: simply by saying "thank for your business."

Your customer service team should also be trained to tell each customer that they appreciate them for having a relationship with you.

Seek out other places to thank your customers and express your appreciation to your loyal customers throughout the selling process.

Learn about the best strategies to retain customers which work best for your company

Use a handful of these customer retention strategies to implement in your e-commerce company, and in time, you'll keep increasing the number of customers who come back, increase your revenue as well as get feedback and recommendations in the end, and ultimately grow your business.