The ten Greatest Buyer Retention Methods (That Are Tried and True)

Think about two manufacturers. 

Model A is certainly one of your favs. You’ve purchased from them earlier than, you like their merchandise, you subscribe to their electronic mail newsletters, and also you get a tingle of anticipation every time you place an order.

Then there’s Model B, who you’ve by no means even heard of. They promote the identical sort of stuff as Model A at an analogous worth level, however you’ve obtained no thought about their product high quality, buyer help, or the rest.

If I requested you which of them of the 2 you’re most probably to purchase from subsequent, I’d wager my home you’ll say Model A.

Rationally, ecommerce entrepreneurs know it’s simpler to promote to present prospects than new ones. But many manufacturers are obsessive about new prospects, with one survey revealing that:

• Solely 20 % of ecommerce professionals have a devoted finances for buyer retention
• 63 % allocate extra finances to acquisition than retention

It’s time to alter that.

On this article, I’ll discuss by every part it is advisable learn about ecommerce buyer retention, from understanding its worth to calculating retention charges. And I’ll even share a retention technique instance or two (truly, 10).

Buyer retention differs from buyer acquisition. The latter means getting prospects which have by no means purchased from you earlier than to make their first purchases. Buyer retention is, subsequently, a later stage within the buyer journey.

At its core, buyer retention is about protecting prospects engaged, making a optimistic expertise, and turning potential one-time patrons into loyal, long-term prospects.

Buyer retention has a greater return on funding than acquisition. It’s cheaper and simpler to retain prospects than purchase new ones. In truth, it’s estimated that the price of buying a buyer is 5 to 10 instances higher than retaining one.

What’s extra, retention ends in higher buyer lifetime worth (CLV). Returning prospects not solely spend extra on common, however in addition they buy extra usually. Fifty-two % of consumers say they’ll exit of their method to purchase from their favourite manufacturers.

Lastly, loyal prospects are likely to advocate manufacturers they wish to their mates and households. That is one other method wherein retention works out cheaper than acquisition. You purchase prospects at no added value by referrals.

Nicely, in accordance with Omniconvert, amongst ecommerce professionals who know their retention charge, a majority cited a charge of 16 – 30 %. However that’s a reasonably broad vary. And it’s value noting that comfortably the most well-liked response, with 31 % of votes, was “Don’t know.”

 So it’s exhausting to get a repair on different model’s retention charges. However you possibly can undoubtedly deliver some much-needed context to your individual retention charge by contemplating it alongside different ecommerce metrics, corresponding to:

• Buyer lifetime worth
• Buyer churn charge
• Repeat buy charge

Right here’s methods to get these numbers…

Buyer lifetime worth (CLV) describes the whole income you earn from a single buyer all through their relationship along with your model. Calculate it utilizing this method:

I do know what you’re considering: “However I don’t know my buyer worth, or my common buyer lifespan. Assist!”

To get these numbers, it is advisable run a pair extra calculations:

• Common buy worth = Whole income inside a time interval / Variety of orders inside that interval
• Common buy frequency charge = Variety of purchases inside your chosen time interval / Variety of whole prospects in that interval
• Buyer worth = Common buy worth x Common buy frequency
• Common Buyer Lifespan = Sum of all buyer lifespans / Whole variety of prospects

Now return and plug these numbers into the CLV method above. Typically talking, the upper your lifetime worth, the extra repeat orders you’re producing—and the higher you’re at retention.

Based on Metrilo, the typical ecommerce repeat buy charge stands at 28.2 %, though numbers fluctuate considerably throughout totally different niches:

This isn’t stunning. When you promote high-ticket, long-lasting merchandise (like TV units), solely a small proportion of consumers will make a number of purchases inside a short while interval.

Nonetheless, for any ecommerce enterprise, no matter area of interest, a excessive repeat buy charge will all the time be a good factor.

But it surely’s changing into more and more tough to keep up an aggressive buyer acquisition technique. Between 2009 and 2022, common acquisition prices surged by 222 % — from $9 – $29 for each new buyer acquired — by a mix of things, together with:

• The phasing-out of third-party cookies
• The launch of iOS 14.5, requiring customers to grant permission for apps to gather and share information
• Elevated laws round client privateness, corresponding to GDPR and CCPA
  

All of which suggests it’s extra necessary than ever for ecommerce entrepreneurs to take a customer-first strategy to acquisition, primarily based round constructing sustainable, long-lasting buyer relationships.

As an example, you could survey prospects that haven’t bought from you shortly. Right here’s an instance from way of life model Fabeltics Males:

The corporate makes use of a fast and easy survey to ask earlier renters why they haven’t returned to the service.

Use a post-purchase electronic mail sequence to encourage retention from the get-go. Submit-buy electronic mails set up belief and create a optimistic buyer expertise that encourages earlier patrons to return.

One necessary factor to recollect right here is that post-purchase emails are likely to have a better open charge than your common e-newsletter, electronic mail blast, and so on. Prospects are eager to seek out out data on the standing of their order.

Which means that post-purchase emails present the proper alternative to spice up the chance of buyer retention when you have the client’s consideration. 

For instance, The North Face makes use of order affirmation emails to get prospects to enroll in its SMS record:

Naturally, The North Face can use this data to keep up communication with earlier prospects and ship out related affords to encourage future purchases.

When you’re seeking to get in on the motion, I like to recommend a sequence of 5 major post-purchase emails. These are:

1. Order affirmation
2. Transport affirmation
3. Transport standing replace
4. Overview request
5. Supply or low cost to return

The final sort of electronic mail prompts the client to make a second buy out of your model. This helps to make your product(s) a staple want for the client.

Right here’s an instance from Brooklinen:

As you possibly can see, the corporate first affords prospects an incentive within the type of factors off their subsequent buy. Then it goes on to advocate merchandise that complement the earlier buy.

The corporate is subtly saying, use your low cost in opposition to these things. Fairly good, huh?

Based on a research printed by the Affiliation for Shopper Analysis, comfortable prospects are keen to spend extra on the manufacturers they love. However the relationship between satisfaction and spending isn’t linear.

Moderately, it seems form of like an S-shape that’s concave for low satisfaction ranges, convex for top satisfaction ranges, and flat for medium ranges of satisfaction:

Because the researchers put it: “Which means that solely extremely glad prospects are keen to pay extra and really dissatisfied prospects are undoubtedly not keen. Average ranges of satisfaction don’t enhance a buyer’s willingness to pay considerably.”

So delighting your prospects gained’t simply assist you to retain them — it affords a bunch of potential revenue-related advantages, corresponding to larger:

Top-of-the-line methods to thrill loyal prospects is to supply a VIP program that rewards prospects for making purchases along with your model, making a reciprocal relationship that has excessive worth for either side.

To do it properly, you first want to verify your VIP program has an air of exclusivity. Take this instance from Savage X Fenty’s Xtra VIP Membership:

Solely VIPs get entry to gadgets hand-picked by the queen herself, Rihanna. Now, if that isn’t attractive, I don’t know what’s.

Additionally, you wish to be certain that your rewards are one thing your prospects truly need. Sure gifted merchandise, for instance, will attraction to some however not others. 

A method round this situation is to supply a points-based reward system the place prospects get to decide on the rewards for themselves, as on this instance from Cotton:On:

One greenback equals 1 level, and prospects can redeem these factors in opposition to any merchandise they need.

The thought is to create a relationship with prospects through a extremely interesting, personalised expertise. Then you definately’ll get them to maintain coming again to your model for extra.

If the standard of your product isn’t as much as scratch, they gained’t purchase from you once more. Nor will they make a repeat buy if they’ve a sub-par customer support interplay, and so forth.

The excellent news is you possibly can nonetheless win unhappy prospects again if one thing goes flawed. Do that by providing quick and useful buyer help. You possibly can also have a contact kind pop up routinely when customers browse your assist pages, which could look one thing like this:

These little touches make an enormous distinction to the client expertise.

It’s additionally a good suggestion to supply help earlier than the client even realizes they want it. This ensures they gained’t run into any roadblocks that forestall them from shopping for from you sooner or later.

You are able to do this by sending out related, useful content material at necessary factors within the buyer journey. 

The White Firm, for example, sends out a fast and simple setup information through electronic mail when folks purchase their air purifiers for the primary time:

The purpose is you need folks to begin utilizing your product, not simply overlook about it. However not solely that, you need them to make the very best use of your product they probably can. This additionally means it turns into part of their every day life, and so they’re extra more likely to come again for extra. 

Any enterprise can do one thing like this. Let’s say, for example, you promote artisan olive oils. It might be a good suggestion to proceed to ship out recipes that make use of your oils.

Right here’s an instance from Outside Voices:

Outside Voices explains how the corporate has added the merchandise that prospects requested for. 

It is a excellent instance of how one can show to prospects that you just’ve added what was lacking out of your product. You possibly can ship an electronic mail like this and invite prospects to get again on board if they want.

It’s additionally a good suggestion to ship product replace emails whenever you add to your product line or providing. If any individual has bought from you beforehand and likes your model, they’ll be more likely to come again and buy from a brand new class.

As an example, MeUndies is well-known for its underwear however despatched out this electronic mail after they began providing robes and slippers, too:

You are able to do one thing just like encourage repeat purchases out of your retailer.

Forty-four % of customers say they’re more likely to grow to be repeat patrons after a personalised procuring expertise.

However bear in mind, personalization goes past together with a buyer’s title in an electronic mail. Anyone can try this. Ecommerce shops are developing with tremendous modern methods to personalize the procuring expertise.

Some vogue and beauty manufacturers, for example, are actually providing digital strive-ons. Clothes model Farfetchpartnered with Snapchat to do that for its prospects.

Prospects stand in entrance of their telephone cameras and say one thing like, “Present me a blue t-shirt.” The superior tech then maps it onto their our bodies in a sensible method.

However, by way of personalization, it’s a must to do what is sensible to your prospects. Perhaps they’re not Snapchat customers, as within the above instance. You recognize your viewers finest (or you need to a minimum of), and you understand what issues to them. 

The garments at passionfruit, for example, are designed and created by members of the LGBTQ+ group for members of the group and allies. 

Those who contemplate this necessary will proceed to purchase from this model regardless if they will discover a related hat elsewhere that’s cheaper. Why? As a result of they wish to be part of this mission.

One other technique to make your product sticky is to supply folks one thing they will’t discover elsewhere. As an example, it could be a novel design or a very modern product. 

Spacestor, for instance, affords signature, modular workplace furnishings.

A direct-to-consumer (DTC) strategy makes this type of factor simpler. The reason being you design and manufacture merchandise your self primarily based on prospects’ exact wants and needs. 

8. Construct a Neighborhood Round Your Model

Model communities are an underutilized retention technique—but they are often extremely efficient. Certainly, 66 % of branded communities say the group has had a optimistic influence on retention, whereas 58 % say their group has elevated buyer loyalty.

It’s straightforward to think about how making prospects really feel deeply invested in your model encourages them to stay round. However how do you construct such a group?

One strategy is to debate your model story. Over four-fifths of customers desire a model’s values to align with their very own, so it is sensible to clarify how you bought began and what you hope to realize (past “creating wealth”), similar to Mojo does right here:

This electronic mail has higher credibility as a result of it’s written by (or a minimum of attributed to) the corporate’s co-founder. And it’s additionally actionable, as a result of it incorporates a reduction code for first-time patrons:

That’s an ideal recipe for serving to new prospects really feel purchased into your model—like they’re a part of a group.

9. Use Knowledge to Higher Perceive Your Prospects

Based on Accenture, 91 % of customers usually tend to store with manufacturers that:

• Acknowledge them
• Bear in mind them
• Present them with related affords and suggestions

To do all that, it is advisable perceive your prospects by digging into the info. Take a look at their shopping conduct, the content material and affords they’ve engaged with, and the merchandise they’ve seen (and bought) to serve them with promotions and suggestions that completely match their preferences.

Equipment model Bellroy will get it proper by sharing curated product collections, incorporating a topic line that makes it clear these suggestions are personalised to the client’s tastes:

Even in the event you weren’t planning to make a purchase order, there’s a great likelihood you’d discover the gathering simply to see what Bellroy has chosen for you.

10. Create a Referral Program

I’ve obtained some unhealthy information for entrepreneurs: simply 38 % of customers belief adverts as a supply of brand name or service data, whereas solely 51 % belief social media platforms.

So what do they belief? Family and friends.

That’s proper; phrase of mouth is seen as essentially the most dependable supply of knowledge and suggestions. And among the finest methods to leverage it’s to begin a referral program.

The thought behind referral advertising is fairly easy: you reward prospects for recommending your merchandise, usually by giving them a reduction code to share with family and friends.

But many manufacturers get it flawed by including a bunch of difficult phrases and circumstances or forcing prospects to leap by too many hoops.

Plus-size vogue model Torrid nails it with this referral electronic mail:

Not solely do prospects get the nice and cozy, fuzzy feeling of sharing a 40 % low cost, however they additionally obtain a present card for his or her troubles. That makes it properly value sharing the love.

Retain Extra Prospects With Drip

From sharing personalised product suggestions to analyzing the the explanation why prospects churn, lots of the methods on this article depend on constructing an in depth understanding of your viewers.

Drip offers you the info and instruments to make that occur.

Our segmentation instruments deliver collectively all of your retailer, customer, and advertising information, serving to you group prospects primarily based on their conduct and the way they interact along with your content material.

All of which helps you construct stronger relationships along with your finest prospects (and win over those that aren’t so satisfied).

Discover out for your self by signing up to your 14-day free trial right now!