Updated : Jan 26, 2024
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How to Improve Ecommerce Customer Retention Rate [6 Best Strategies]

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Drashti bhadesiya
Ways to improve ecommerce customer retention.

How to Improve Ecommerce Customer Retention Rate [6 Best Strategies]

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Ever scratched your head, wondering how to improve Ecommerce Customer Retention Rate?

Certain eCommerce businesses keep their customers hooked, making repeated purchases and how? Holding onto customers in the bustling eCommerce marketplace can seem quite challenging, but it’s not an impossible feat.

Learning the most effective customer retention tactics can completely change your business landscape. It not only skyrockets your sales but also helps you cultivate a community of loyal brand followers.

So, let’s get cracking on the top six strategies that can dramatically improve your eCommerce customer retention rate. Get ready to learn the skill of converting one-time buyers into repeat customers.

Let’s dive right in!

What is customer retention?

Customer retention is when a company keeps its customers coming back to buy more things or use their services again instead of losing them to other companies. It’s like when you have a favourite ice cream shop and keep going back because you love their ice cream so much. The shop is doing a good job at keeping you as a customer. Companies try to make their customers happy and satisfied so they continue to shop or use their services for a long time.

Think about this. You’re running an online business, and you want to keep your customers coming back. This is where customer retention comes into play. It’s all about making sure your customers stay interested and keep buying from you. It’s like building a friendship where you always want to provide something special that keeps them engaged.

Why is customer retention important?

As the customer retention definition is much clearer, we all know by now why the business needs to have your customers come back. Let’s understand it!

  1. Save Money, Make Money:
    • Keeping customers is like saving money in a piggy bank. It costs less to keep old friends (customers) than to make new ones. Like finding a dollar in your pocket, it’s a happy surprise that helps your wallet!
  2. Familiar Faces Buy More:
    • Customers who already know and like your store are like classmates you’ve known for years. They’re more likely to join your lunch table (or in this case, buy more products) because they know they’ll have a good time.
  3. Learn and Grow Together:
    • Imagine your customers are partners in a school project. The more you work with them, the more you learn about what they like and don’t like. This is like getting the inside scoop on a test, helping you score better next time!
  4. Rewards for Loyalty:
    • Think of special programs for your best customers as exclusive club memberships. It’s like being part of a secret treehouse club where members get cool badges and privileges, making them feel super special and wanting to stick around forever.

6 Best Ecommerce Customer Retention Strategies and Tactics

✅ Send Exclusive Promotional Emails For Repeat Buyers

Want to keep your online shop’s regular buyers coming back for more? One way to do it is by sending them exclusive promotional emails. This approach not only gives your loyal customers a treat but also gives them a reason to continue buying from your store.

Here’s how you can make the most out of this tactic:

  • Make your emails more personal. Use the customer’s name and base your product suggestions on what they’ve bought before.
  • Show your repeat customers that you value them. Give them exclusive discounts or let them be the first to know about your new products.
  • Encourage your happy customers to tell others about your brand. You can do this by giving them incentives for referrals.
  • Keep your customers informed about their membership levels or rewards. It’s a great way to show that you appreciate their loyalty.

✅ Develop A Comprehensive Customer Onboarding Program

So, you’ve got a booming ecommerce business, but you’re wondering how to roll out the red carpet for your new customers? Easy – get a stellar customer onboarding program in place! It’s a fantastic way to keep your customers coming back for more.

First things first, lay out a well-planned program that helps your customers get acquainted with what your brand is all about. How about offering them helpful resources, step-by-step tutorials, or handy guides to make the most of your products or services? Sounds good, right?

But, don’t stop there. Make sure you tailor their experience to their unique needs and likes. Send them a warm welcome email, let them in on special deals, or give them access to exclusive content.

And hey, don’t forget to keep your ears open to their feedback. Their insights could be the key to fine-tuning your onboarding process. This way, you’re not just keeping your customers happy, but also giving your profits a nice little boost!

✅ Personalize Communication Where Possible

In the world of online shopping, making your communication more personalized to fit each customer’s likes and shopping habits can really help keep them coming back for more. When customers feel seen and understood, they’re more likely to stick around and stay loyal.

Here’s how you can make your communication more personal:

  • Use what you know about your customers to shape your messages and offers.
  • Suggest products based on what they’ve bought in the past.
  • Make your email marketing feel more personal to spark more interaction.
  • Make sure your loyalty programs are tailored to each customer, so the rewards feel truly special to them.

This customer retention strategy for online shopping doesn’t just keep customers engaged, but it also encourages them to buy more, which increases the overall worth of each customer in the long run.

✅ Develop A Customer Loyalty Program

Building a customer loyalty program is a super effective way to keep your online store’s customers coming back for more. It’s all about giving your regular customers a little something extra to say thank you for their support. And let’s not forget the bonus of creating that must-have community vibe.

You can add some fun to your loyalty program by adding a touch of gamification. A little bit of friendly competition never hurt anyone, right? It’s a great way to get your customers excited about coming back to your online store.

And let’s not forget about communication. It’s all about keeping your customers in the know. Keep them up-to-date and they’ll stay interested.

✅ Survey customers to understand their choices & behaviour and identify areas for improvement

Having a solid customer loyalty program is a great start. But, to make it even better, why not chat with your customers now and then? Get to know their likes, dislikes, and habits. It’s a great way to figure out what areas might need a little extra attention.

Want to keep your customers coming back for more? Here’s what you can do:

  • Start some friendly surveys. It’s a great way to learn more about what your customers are thinking.
  • Analyze the responses from these surveys. It’s a treasure map showing you where your ecommerce experience could be improved.
  • Use the insights from your surveys to shape your strategies. Make sure you’re giving your customers what they want.
  • Don’t just listen, act! Make the changes suggested by your customers. It shows them you value their opinion and are ready to make things better.

✅ Provide seamless and personalized omnichannel communication

Looking for ways to keep your online customers coming back for more? Consider a smooth, personalized communication style that reaches out to them on diverse platforms. Merge your messages on social media, emails, and other platforms to present a unified customer journey.

Customizing your communication style according to customer tastes and patterns can add a unique, personal touch. This approach not only ensures uniformity but also establishes trust, improving your overall customer retention plan.

Using data and analytics, you can get a grasp on customer behavior, and fine-tune your communication strategies. Remember, the key to a successful online business is engaging customers where they’re most at ease.

Thus, a well-planned communication strategy that covers all platforms can significantly improve your customer retention figures.

How Do You Measure Customer Retention Rate?

To figure out how well a company keeps its customers over a certain time, we can use a simple math formula called the customer retention rate. This formula looks at three key numbers:

  1. How many customers a company had when the period started
  2. How many customers did it have when that period ended
  3. How many new customers joined during that time

Here’s how you do the math: Customer retention rate = [(Number of customers at the end of the period – New customers acquired during that period) / Number of customers at the start of the period] x 100

Let’s see this formula in action with Company A’s example: At the start of the year, Company A had 100 customers. By the end of the year, they had 80 customers but had also gained 45 new customers during the year. To calculate Company A’s customer retention rate, we follow the formula:

Customer retention rate = [(80 – 45) / 100] x 100

So, Company A’s customer retention rate is 35%.

Conclusion: Improve Ecommerce Customer Retention Rate with Desku

By giving the best customer experience every time possible, building customer loyalty, and giving opportunities for cross-selling you can always have chances of customer retention in your business.

If you are all buckled up to improve customer service then Desku.io is here to help you build exclusive ways of managing customer queries, and real-time and quick customer engagement that will ultimately help in customer retention. We have observed that customers who have switched to Desku.io have a 5% difference and higher gross in customer retention.

If you do not believe us, you can try yourself by taking a 7-day free trial right away.

Frequently Asked Questions

What is Customer Retention and Why is it Important for Ecommerce?

What does customer retention mean, and why is it crucial for my online store? A: Customer retention refers to the ability of a company to keep its customers over time, encouraging them to make repeat purchases rather than losing them to competitors. For eCommerce businesses, retaining customers is essential because it’s more cost-effective to keep existing customers than to acquire new ones. Loyal customers tend to spend more over time, providing a higher lifetime value and helping to sustain and grow your business’s revenue.

How Can I Improve My Ecommerce Customer Retention Rate?

To boost your eCommerce customer retention rate, focus on personalization, quality customer service, and building a strong loyalty program. Personalizing communications and offers based on past purchase behaviour can make customers feel valued and understood, leading to higher engagement and repeat purchases. Implementing a comprehensive customer onboarding program can help new customers feel welcome and guide them to find value in your products or services quickly. Additionally, developing a customer loyalty program rewards repeat customers, encouraging them to continue doing business with you.

How Do I Measure Customer Retention Rate?

Number of customers at the end of the period−

(New customers acquired during that period)/Number of customers at the start of the period)×100. This metric helps you understand how well your business retains customers over a specific time frame.

For example, if you start with 100 customers, end with 80 customers, and acquired 45 new customers during the period, your customer retention rate would be 35%. Monitoring this rate over time allows you to gauge the effectiveness of your retention strategies.

Gaurav Nagani
Gaurav Nagani
As Founder & CEO of Desku.io, Gaurav has made a distinct mark in the customer support and ai bot field. His commitment to AI-enhanced solutions and his industry experience have been instrumental in modernizing customer service.

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