Loyalty and retention are the names of the game when it comes to growing a successful e-commerce business. If you aren’t actively trying to stimulate returning customers, then your business will have to survive solely on one-off purchases.

Managing customer loyalty and retention is vital because you’ve already attracted their business once. You know that they like your products and services. Thus, they are a high-value target when trying to market new or alternative items. Not to mention, returning customers are known to spend over two thirds more than first-time shoppers.

In some instances, an e-commerce business’ most loyal customers will account for a huge chunk of its overall sales. So, let’s take some time investigating the ways that you can grow customer loyalty and drive buyers back to your e-commerce site.

Buyer Persona

buyer persona

Have you ever heard the expression ‘money talks’? Well, in the e-commerce world, your products do the talking because they are ultimately what draws consumers in and entice purchases. One of the essential keys of customer retention is being able to effectively communicate with past customers about your e-commerce business’ new products. How do you do this? Segmenting your email list based on buyer persona.

You should do your best to only target the customers with new product offerings that are relevant to them. You can determine this relevancy based on their past purchases. Are they someone that is going to find these new products interesting? Or, will it just feel like spam?

Marketing Sherpa, a marketing research company, conducted a research study about the effects studying a buyer persona has on increasing sales. They discovered that understanding buyer persona can increase page visits by 100%.

Discounts

discounts and offers

Next to new products, your second tactic for attracting returning customers consists of utilizing discounts, deals, and offers. Everyone loves the opportunity to save money, especially on their favorite items.

Again, relevancy is vital. You want to find ways to offer discounts or savings on products that are related to the customer and their past purchases. Otherwise, the offers will go unused.

CouponBox, an online coupon site, found that sitewide coupons were the best performing coupons — boosting sales by 67%.

You also have to consider how easy your discounts or coupons are in terms of accessibility and usability. The deals should be easily communicated and even easier to use. Lengthy discount codes, user-unfriendly checkout processes, and other obstacles can make it challenging for customers to actually use those discounts, which can disillusion them from making future purchases.

Loyalty Program

loyalty program

One of the best channels for delivering information about discounts, offers, and other product materials is through a loyalty program. These programs significantly expand your e-commerce business’ customer experience, which is a massive competitive differentiator in the digital landscape.

Loyalty programs are particularly impactful with younger generations. By the numbers, 63% of Gen Z and 71% of Millennials participate in at least one loyalty program. These consumers like when brands are willing to go the extra mile and recognize and incentivize their returning business.

These programs come in all shapes and sizes, but their power to draw returning customers it is always high. One of the most highly regarded loyalty programs comes from Starbucks. Their program has one of the best mobile apps to accompany it and, when customers achieve the highest loyalty level, they receive a personalized gold Starbucks card. This really helps encourage return business, as consumers try and accomplish this illustrious goal.

National car rental company saw similar benefits when they created their Emerald Exchange rewards program. This rewards frequent customers with typical discounts and perks, and it also allows them to join an exclusive membership, where they can interact and swap stories with other Emerald Exchange members. Instituting this loyalty community has helped National generate 27% more loyalty members for a 32% increase in revenue.

Paying for Shipping

free shipping

For e-commerce consumers, one of the biggest obstacles that detract from their shopping experience is the cost of shipping. This added fee not only makes the final price higher, but it creates unwanted friction in the buyer’s purchasing journey. This is a strong reason why Amazon created their Prime program and routinely offer free shipping around the holidays. This incentive increased holiday sales by 29%.

In fact, unexpected shipping costs are the number one reason for cart abandonment. So, offering free shipping will not only make your e-commerce business more enticing for returning customers, but it will also generate more first-time shopper purchases.

Now, not every business has the ability to offer completely free shipping. That said, even cutting shipping costs a little bit can make a huge difference, especially if you’re upfront about what these fees to ship products will be. Customers will remember the inexpensive and transparent nature of your shipping fees.

Communicate, Communicate, Communicate

communicate

The common thread through all of these strategies is communication. Whether you’re trying to entice loyalty membership, educate about new products or discounts or otherwise, being productive with your communication is critical, especially in the Digital Age where businesses are always competing for recognition being fresh in the minds of consumers.

Engaging customers on social media, creating text alerts, developing a mobile app, offering impeccable customer service, these are all necessary steps that your e-commerce business should be performing to keep those communication channels open and active.

Hubspot takes it one step further and uses video to communicate with customers. What they found was that 55% of customers admit to watching the entire video whereas only 25% read an entire blog post.

And, as always, monitor your communication efforts to find which strategies are paying off the most. If your 10% off coupon isn’t a hit, it may not be the offer itself, but how you’ve communicated the deal to your customers. With a little revising of your messaging, you may see a significant shift in how effective your tactics are. Thus, don’t be afraid to get creative and be bold in your communication efforts. It may be what your e-commerce business needs to stand out amongst its competition.

Conclusion

The simple truth is that you spend more acquiring new customers than keeping the ones you have, as much as five to twenty-five times more! To grow more returning sales and keep customers coming back again and again, you should be making every effort to follow the strategies mentioned in this discussion. Otherwise, you’ll be having to spend even more to dig up new business.

Anastasia Sviridenko is a content marketing manager at TextMagic, a bulk SMS software solution. When she’s not crafting a new piece of content, you can find her going out for a run or reading a book at home.