What Is customer retention?
Customer retention refers to the number of people who make repeat purchases from a business. Growth hackers will tell you that by increasing customer retention rates, you can often increase your revenue faster.
The thing is, customer retention can be difficult for e-commerce businesses because there are so many alternatives available for consumers. However, a retention marketing plan can help you improve customer retention and increase your bottom line.
Without retention marketing, you're constantly prospecting for potential customers rather than focusing on building a loyal customer base. The truth is you need to do both, but many e-commerce businesses focus on the new consumer.
Here we discuss retention marketing and industry technology and offer five solutions to keep customers coming back.
What Is Retention Marketing?
Retention marketing focuses on engaging returning customers rather than targeting new ones. The goal is to increase customer loyalty by consistently giving them added value and more opportunities to purchase your products.
McKinsey Insights reports in 2022, more US consumers switched brands and retailers, looking for value. What's more, a little over a third of consumers opted to buy from private labels.
While your business needs new and returning customers, retention marketing will increase customers' lifetime value and long-term profitability.
Retention Marketing Tools
Retention marketing is about communication with your customers and using available technology to leverage data for actionable insights. Technology is a driver in retention marketing.
It leverages strategies to keep customers engaged and loyal to your brand based on relevant data. Real-time reporting tools provide deep insights into:
Additionally, an integrated dashboard enables businesses to connect seamlessly to top email marketing applications, such as SalesForce and Marketo. Using technology to leverage insights and act on them is the foundation of customer retention.
5 Ways to Improve Customer Retention
If you want loyal customers, focus on building long-term relationships and delivering value throughout the customer journey.
1. Provide Friendly and Efficient Customer Support
Loyal customers spend more and will likely refer their friends and family to your brand. Reliable customer support is vital to building brand trust.
Today, customers expect to be able to reach customer support 24/7. Automation makes it possible to be there at all hours, and you can follow up if needed.
Provide customer service with easy access and accurate responses to solve customer issues. Listen and collect customer feedback. Then use it to improve customer experiences.
Nurturing customer relationships by providing ongoing service and support helps build lasting customer relationships that drive revenue.
2. Make it Personal
When your customers give social endorsements, it increases customer retention. Encourage current customers to share their thoughts on your product or service, or implement a refer-a-friend campaign encouraging customers to endorse your brand.
Communities increase customer retention. Share your vision, and talk about topics your customers are interested in that naturally relate to your products or services.
Retention marketing is all about knowing your customers. To that end, you can leverage customer data to understand their preferences and motivations. Customers will come back to make purchases if they're getting value from your brand.
Use the data to build buyer personas that represent the type of person who uses your product or service. Then create campaigns that add value for them.
3. Offer Loyalty Programs and Discounts
Loyalty programs reward your customers for buying your products and services. It can be anything from surprise swag to exclusive access that only loyal customers can purchase.
Loyalty programs and discounts show your repeat customers that you appreciate their business. Similarly, referral programs reward your customers when they send friends and family to your business.
E-commerce loyalty programs help brands build community and generate data to gain personalization insights. Consider implementing VIP benefits to increase customer lifetime value.
Social media contests encourage brand loyalty, build trust, and are a low-cost way to engage customers.
4. Dedicate More Attention to Email Campaigns
Email is an opt-in channel. Once they sign up, you can use customer emails to follow up, offer discounts, and find upsell opportunities.
To that end, it's essential to dedicate more attention to email campaigns to increase customer retention.
Email represents 50% of Latico Leathers' total revenue, and they wanted to dramatically increase their email list, drive a positive ROI, and maintain or increase their sending reputation. The company integrated Resolve with Klaviyo and experienced a 45% open rate from Resolve contacts.
You can customize email marketing campaigns and messaging for your audience. Analytics reveal which emails your customers open and don't open.
The data allows you to refine your email campaigns to suit your customers' preferences. Retention emails help build your email list, and you can segment it according to the most engaged to the least active recipients.
5. Re-engage Abandonment Revenue
First, use data analytics to measure your cart abandonment rate. If it's high, revisit your email marketing campaigns to determine why they don't resonate with your audience.
Cart abandonment could also be website related. For example, checkout may not be a user-friendly experience. Once you gather insights into why customers abandon their carts, you can set out to re-engage them.
Leverage industry-leading identity technology to increase cart abandonment revenue. For example, GetEmails enables businesses to send abandoned cart emails to users, even if they still need to opt into your newsletter.
Work With Retention Marketing Professionals
Retention.com specializes in retention marketing and e-commerce solutions, including cart abandonment and re-engaging potentially lost customers. We provide one-click integrations with leading marketing automation platforms.
Our dashboard features a user-friendly interface to easily connect to any email marketing application in under a minute. Retention's integrations automatically update and suppress contacts daily.
We can help you reclaim up to ten times more abandonment revenue by leveraging industry-leading Identity Resolution technology. When an unidentified customer abandons a cart, we identify them. Then a personalized flow automatically triggers in the messaging platform.
Scale up your abandonment flows and improve your retention marketing strategy. Get in touch with Retention.com today to find out how we can help.