3 Simple Strategies to Increase Customer Retention

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As you build up your ecommerce business, there is one very important element that is often overlooked, even by the most savvy of business folks. Many ecommerce operators don’t consider that it is proven to be more cost effective to woo existing customers, encouraging repeat business, than it is to market to, attract, and convert brand new visitors of your online store. Take a second to think about it: your existing customers have already expressed interest in your products and have successfully navigated your website and shopping cart before––an advantage and ideal set up to remarket to this group. Increasing customer retention is a strategy that should be built into your ecommerce systems and maximized fully to ensure the success of your online store.

Plus, on top of being more cost effective, retaining customers builds a loyal, devoted, and enthusiastic fanbase around your brand, and pumped up fans of your brand means more engagement with your company and the potential for organic marketing to occur via word of mouth, personal testimony, and recommendations from your fans. Here are 3 simple strategies to increase customer retention with your online store.

1. Professionalism

The number one way to retain customers is to always exude the highest level of professionalism. While that can mean different things for different industries and brands (such as tone and style), there are a few commonalities that every business should uphold, virtues such as accuracy and honesty, that distinguish it as a professional company.

It is absolutely necessary, no matter what kind of online store you run, to have accurate descriptions of your products, services, turnaround times, and prices including fees. The quickest way to lose customers, even those who have purchased from you before, is to lose their trust––and the quickest way to lose anyone’s trust is to be dishonest or misrepresent a transaction or purchase.

As tempting as it may be to add a few additional centimeters to the size description of your electronics and television product listings, for example, or how harmless it may seem to throw in generic descriptions to liven up your products despite their accuracy (“The brightest screen on the market!”), you must remain true to what you’re offering or risk disgruntled customers, returned purchases and loss of profits, and a damaging reputation. Nothing will hinder customer retention, as well as new customer acquisition, as much as inaccuracy, no matter how small.

Remember, you don’t need to over-sell your merchandise, just highlight the perks, benefits, and details in an engaging way. Be sure to check out our Ecommerce Rules post on How to Create Captivating Product Descriptions to ensure that you’re on-point product descriptions entice both existing and new consumers.

Also, nickle and diming your consumers is not the way to gain trust or encourage repeat business. Imagine, from the buyer’s perspective, how off-putting it is to locate an item that you really want or need and then go through the checkout process only to find that shipping was much more than they had thought or that the website had alluded to. This is usually the number one cause of abandoned shopping carts. Customers don’t want to be surprised with additional costs or fees of varying amounts––it is best to be upfront with the total shipping amount or any fees that must be charged with purchases, so that buyers can calculate these factors into their decision to purchase or not, rather than being caught off guard later on. Simplifying the process and offering clear cut information to consumers will lead to a positive experience with your online store and encourage repeat business.

2. Communication & Follow-Through

Of course, even the highest rated of online stores will receive customer complaints and bad reviews every once in awhile, some valid and others perhaps a consequence of circumstance (maybe Bob from Oregon had a bad day when he received your shipment, for example). To ensure you continue to uphold and build up your professional image and are able to appease customers who are already fans of your brand, you must address bad reviews and points of customer angst.

Reply to dissatisfied customers while remaining polite and sympathetic, but firm––do not waiver in your confidence in your brand, its message, or its products. Simply offer to fix the problem as best as you can or at the very least, lend a sympathetic ear allowing your customers to know you hear them and you care. Consider quick solutions to options such as refunding shipping costs, replacing purchased items, sending them a small gift card for their next purchase (this is a great move to encourage repeat business), or personally reaching out to that customer and engaging with them one-on-one.

Offering empathy and great customer service, plus reinforcing the professional qualities and benefits of shopping with you will help rectify any issues existing customers have had with your store as well as demonstrate to new visitors that you’re serious about your customers and their happiness. Consumers will give repeat business to stores that they feel hold them as the number one priority.

In addition, flawless follow-through can only further boost professionalism and customer happiness, equating in increasing customer retention. If your website boasts two-day shipping, then it is vital that purchases arrive on customer doorsteps within two days of ordering. Nothing will draw the rapid fire click-clacking of an angry keyboard to social media, review sites, and feedback entries than late or slow shipping. Not getting an item on time is certainly a highly ranked pet peeve of online shoppers, so if your store promises a certain turnaround time, it is necessary that you meet it. Communication and follow-through are essential to increasing customer retention for ecommerces.

3. Incentives

While professionalism, open communication, and follow-through should be built into every ecommerce system for customer retention and beyond, incentives are solely for encouraging buyers to shop your website. Everybody loves a good sale.

Sales draw people to your website because most shoppers use pricing as a strong reason to buy or not to buy, but a system of regular sales and specials will continually draw shoppers to your online store. Michaels craft store has successfully implemented such a schedule: every week it releases its weekly ad both online and in stores, encouraging people to shop the special sales. Because Michaels customers know that there is a new featured list of specially priced items every week in addition to a new batch of timely coupons, they check in weekly to see what’s up for grabs. This consistent schedule and routine enticement creates buzz around Michaels but also puts in place a recurring incentive to check out the store. It does a great job of utilizing a system that increases customer retention via weekly incentive.

Another popular incentive for increasing customer retention is through loyalty programs. It is likely you are a member of many of these programs without really evening thinking about it as it’s become the norm––that Albertsons or grocery store card that makes you privy to the store’s sales, for example, is a loyalty program that both you and the grocery store benefit from. Having that card means you, as a consumer, have access to discounted pricing. And in turn, the store secured you as a repeat customer because you’ll likely be shopping there regularly to access the special prices the card allows you.

Ecommerce loyalty programs work much in the same way. A customer signs up for a username or account with your store (much like the card at Albertsons), for example, and points can be given with each purchase. The points are tracked and a reward system is set in place for each level of points customers reach. There are many ways loyalty programs can be employed for your online store; check out companies that specialize in such programs like Reward Me for more information.

Finally, the easiest way to maintain and sometimes exceed customer happiness and therefore increase customer retention is to add personal touches to customer purchases. This could be as simple as a handwritten thank you note expressing your gratitude for their business or if your budget allows for it, an automatic upgrade on faster shipping at no additional cost. Small acts of kindness go a long way for customers, and it’s something that many remember, encouraging them to shop with you again and share their great experience with others.

Published by

Joseph Yi

Since he was a freshman in college, Joseph has worked in several internet startup companies and has developed campaigns and digital strategies for Fortune 500 companies and brands including the Los Angeles Lakers, Manchester City FC, the Oakland Raiders, Sephora, and Whole Foods. Follow Joseph on Twitter.