By MICHAEL S
Since eCommerce is crushing it and the more and more people is trying to get on the eComm Train, customer loyalty is becoming one of the main determinants of success. 🚂
How may we know that?
Just check this simple example. If we are comparing, the effectiveness of emailing to an external base, with doing the same with current customers, the results are eye-catching.
The CTR is around 0,6% of the former, and 5,5% in the second scenario! (Doubleclick stats. – UPDATED: Now Google Marketing Platform.)
I know that measuring CTR we are only halfway through (the ultimate goal is getting the conversions of course), but still, the decreasing CTR rates every year are showing us a general tendency. 📈
The process of getting a new customer seems to be more and more costly!
Currently, the cost of gaining a new customer is estimated from 3 to 15 times higher than the cost of encouraging an already existing customer to shop again.
In a study called “E-Loyalty: Your Secret Weapon on the Web”, they estimated that online stores lose from $20 to $80 on each new customer in the first year because of the very high acquisition costs.
And only those stores who built on customer’s loyalty could profit from them in the next years. 💸
This study proves that, surviving in e-commerce, the main factor is not just about getting new customers, but building on the existing one’s loyalty.
Online businesses which build their sales only on acquiring first-time buyers may doomed to failure. Attracting new customers is getting more and more expensive to you, and without caring their loyalty, these new buyers can generate sales but maybe without any profit.
Taking care of loyal customers can boost your bottom line without spending more on the acquisition. Increasing customer retention by just 5% can boost profits by up to 95%! 🔥
The question is, how can you keep your current customers happy and loyal? How can you turn one-time customers into repeat buyers?
The easy and short answer is “communicate with them”!
A little bit longer version is “communicate with them through emails”! 📧
Time to time again, email has proven to be one of the top-converting channels for eCommerce.
You want to send a variety of types of emails – primarily newsletters, sales and promotions, tips, content that are useful for your customer base in general.
Also, utilize the incredible possibility of email list segmentation that some ESPs can provide like Klaviyo. This way it’s possible to send more personalized messages that can have a much higher impact.
Setting up, the always profitable, event-triggered email automations that can make your email marketing easier and more effective. 📨
Of course, you can figure out other methods on how to make your customers staying loyal to you. But…
My main point here, that retention is necessary for profitability!
Once you have a customer, you want to turn the Average Order Value into a Customer Lifetime Value. Without loyalty and retention, online businesses are rarely profitable. 🤔
Spread the word
