Customers are the lifelines of business, irrespective of whether it is a brick and mortar store or an ecommerce business. According to industry experts at Infiniti Research, more than half of a company’s future revenue will come from approximately 20% of their existing customers. Furthermore, it is always wiser to lay greater emphasis on using customer retention strategies to retain existing customers, as attracting new customers could cost a company five times more. In the absence of strong customer retention strategies, companies will struggle to establish a strong customer base, eventually causing profits to tumble. By implementing customer retention techniques for online and in-store platforms, businesses can effectively encourage customers to keep coming back for more, by creating positive, personalized, and innovative experiences.
How to retain customers: 4 proven customer retention strategies
Launch win-back campaigns
Win-back campaigns involve contacting customers from whom you haven’t heard from in a while. This is an attempt made to win back these customers using highly targeted campaigns. This is one of the most popular customer retention strategies among several old-school direct response marketers. Timing is a crucial factor in the effectiveness of such customer retention strategies. E-commerce companies must try to win back customers as early as possible by offering attractive rewards and discounts. In order to get the timing right, it is essential to understand the frequency of purchase of the buyers. If on an average, customers order every 2 months, then it would be beneficial to implement a win-back campaign around the 60-day mark.
The primary idea behind a loyalty program is simple, reward your customers for frequent purchases. Customer retention strategies like giving out loyalty points is highly effective and is commonly used by several successful companies. E-commerce companies can also benefit from such customer retention strategies. Although implementing a loyalty program does not guarantee increased sales, but when combined with a competitive product and great customer service it can play a key role in increasing sales and improving customer retention. Furthermore, it may be difficult to attract new customers into the loyalty category. However, offering some surprise loyalty points with their first purchase can one of the effective customer retention strategies to ensure repeat purchases. Get more info on how our solutions help you build customer relationships and promote customer loyalty.
Subscription-based business model
Many e-commerce companies are known to resist the subscription-based business model. But before dismissing the idea completely, companies must consider the fact that if a person has been buying the same supplement every month for several years, giving them the opportunity to save time and money by subscribing to regular delivery would turn out to be favorable. If they are able to pull this off, it means that the business would gain the benefit of recurring monthly revenue. When coupled with great customer services, customer retention strategies like monthly subscription guarantees a boost in the overall sales performance.
Offering additional perks through a paid membership is another highly successful customer retention strategy that is not only an additional revenue generating source for companies but also promotes customer loyalty. Take the example of Amazon prime which has been highly successful in getting customers to sign up to their membership program by offering exclusive benefits and discounts to members all year round. However, not every ecommerce company can be successful in implementing this model. To start off, they must have a loyal customer base and also serious thought and planning to implement it. If successful, paid memberships will reward loyal customers and increase their level of commitment to the business. Moreover, paying the small fee will give them yet another reason to come back and purchase from the company.