Your greatest asset as an ecommerce business is your customers. Ranging from loyal fans to first-time customers, these people are what keep your business running. So, how do you keep, maintain and build a profitable relationship with your customers during their client lifetime?
We break down 5 simple and effective ways you can boost customer retention and lifetime value in e-commerce. Check them out below!
- Mutually Beneficial Referral Program
- Offer Insider Exclusives
- Listen & Respond to Your Customers
- Invest in Customer Service
- Provide Resource Articles
What Exactly Is Customer Lifetime Value?
Customer Lifetime Value (CLV) highlights the total amount of revenue a single customer has spent on your products over their lifetime as a customer. This number indicates customer satisfaction with both your product and brand experience.
You have probably heard it is easier to maintain a customer than to attract a new prospect. This is true. In fact, it is estimated keeping an existing customer is five times less expensive than attracting new ones. Simply put, the longer you have a satisfied customer, the more money your business will make.
So how can you boost customer retention and lifetime value? Start with these five fool-proof tricks.
Develop a Beneficial Referral Plan
Customers that actively engage with a referral plan benefit from a mutually inclusive relationship with their brand. They feel as much as they give to you, you are giving back to them in return. Those returns can look like discounts, insider information, product testing opportunities, early-bird deals, or free gifts. Regardless of the benefit, they feel loyal to your brand and your purpose and are willing to spend more money over their customer lifetime.
Referred customers have a 37% higher retention rate than other customers that have engaged with your business through other marketing channels. It’s worth it to you to engage your customers and have them share and refer new customers to you to grow your audience.
Offer Insider Exclusives
Customers that engage with your loyalty program are a unique community that e-commerce businesses can reward with exclusive perks. You can offer VIP experiences and rewards to those that frequently engage with your business. These small rewards increase their loyalty and your customers’ lifetime value.
Antique Candle Co. offers a unique experience for individuals that want to be candle-loving BFFs. Through carefully crafted emails and text communications, they share early access to deals, new product launches, and frequently request loyal customers to become new product testers.
Listen and Respond to Your Customers
Put your customers first; they are your number one priority. Your business performance will be a strong indicator of whether your customers are satisfied with their brand experience. Investing in the proper measures to track how your customer interactions are performing will be critical for long-term success.
Things to consider and question when listening and responding to your customers:
- Are you providing enough information for your customers? Always look for improvements. Consider updating product descriptions, displaying delivery costs upfront, updating product imagery, etc.
- Quickly respond to client testimonials or comments on your webpage. Responsive brands indicate they are willing to listen to customer concerns immediately.
- Build in customer feedback requests on tracking information and product emails.
I can even be found asking prospects and clients, when was the last time you picked up the phone and called a customer out of the blue? Making 15-20 phone calls a month at random keeps you close to the customer and helps you continually update and revise your customer journey maps so you can continue to add value.
Invest in Customer Service
Strong customer service leads to better customer experiences which leads to improved customer retention and lifetime value. Customer service can have a direct impact on your bottom line, so it is crucial to have a team that is well-equipped to solve problems and respond promptly wherever their customers may be.
Approximately 66% of customers use three different communication channels when they are trying to reach out to support. This makes it crucial to have your brand actively engaged on multiple social media sites to ensure all needs are met for your clients.
I always tell clients that “you should make it easy for your customers to reach you and to meet them where they are at” (website form, live chat, social media, SMS, etc.). These two things make a world of difference in making them feel valued and that you are there for them.
Provide Resource Articles
Do not underestimate the power of strong content. Product content plays a significant role in influencing buying decisions. Brands that provide in-depth product descriptions, how-to guides, FAQs, lifestyle videos, and compelling stories of the product being used by real customers, have a clear advantage when getting a customer to convert. In a recent study, consumers placed credible product information as the main reason for purchasing a product.
Providing resource articles that are insight-driven can answer consumer questions, such as:
- How can I use this product to solve my problem?
- What other competitors should I research before purchasing this product?
- What are the pros and cons of the product?
- What happens if the product is defective or needs to be replaced?
- What product attributes are most compelling to purchase?
Improving customer retention and customer lifetime value doesn’t happen in a blink of an eye. It requires dedication and a focus on putting the customer’s needs first. Implementing the five strategies is a strong way to improve these metrics all while building the necessary trust for long-term prosperity. Talk with Stryde to learn more about implementing these strategies today!