How to improve customer loyalty in your ecommerce business

So, you’ve set up your online store, added products, and made some sales. But here’s the catch – your job isn’t done.

After those initial sales, you’re at a crucial point to ensure those first customers come back for more. PwC’s 2022 customer loyalty survey found that over a quarter of people switched to a competitor in the past year due to bad experiences.

Losing customers is costly. Not only do businesses need to fix issues that drive new customers away, but they also have to invest in replacing them. According to CommerceNext’s 2022 report, about 61% of direct-to-consumer companies considered increasing customer acquisition costs their biggest challenge for 2022 revenue goals.

With rising costs, it’s vital to keep building customer loyalty in e-commerce. Creating engaging experiences reduces costs and builds a group of advocates. Studies show up to 80% of profits come from 20% of repeat customers. Surprisingly, only 32% of business owners prioritize retaining customers.

But you don’t have to follow the crowd. If you’re serious about keeping customers long-term, you’re in luck. This article will guide you on the benefits and most effective strategies to build e-commerce customer loyalty.

What is customer loyalty?

It’s when people keep choosing your brand regularly because they’ve had good experiences and find value in what you offer. In simple terms, it shows how likely your current customers will keep shopping with you and suggest your brand to others.

Having loyal customers is great because you don’t have to stress as much about getting new ones. Now, how is customer loyalty different from customer retention?

Customer retention is like a step towards loyalty. Retained customers are happy to buy from you again, but they might switch to another option if it’s a better deal or a smoother shopping experience. They might recommend you, but their loyalty is tied to meeting immediate needs.

On the other hand, loyal customers go beyond just repeat purchases. They regularly tell others about your brand and are forgiving if there’s an occasional mistake.

The 7 Benefits of Customer Loyalty

The benefits of cultivating loyal customers extend beyond immediate financial gains. They form a crucial part of your marketing strategy, influencing others to choose your brand and ensuring the sustained success of your e-commerce venture.

1. Word-of-Mouth Marketing – Loyal customers become your brand ambassadors, naturally sharing positive experiences with others. This organic, word-of-mouth marketing is incredibly powerful in attracting new shoppers.
2. Customer Retention – Retaining existing customers is often more cost-effective than acquiring new ones. Loyal customers are less likely to switch to competitors, providing a stable customer base for your e-commerce business.
3. Increased Sales and Revenue – Loyal customers tend to make repeat purchases, contributing to a steady stream of revenue. Their trust in your brand often leads to higher spending and more frequent transactions.
4. Brand Advocacy – As customers develop a strong connection with your brand, they are more likely to advocate for it. They may leave positive reviews, recommend your products to friends, or even actively engage on social media, further enhancing your brand’s reputation.
5. Boosted Brand Awareness – Through the positive experiences shared by loyal customers, your brand gains visibility. This word-of-mouth promotion and social marketing contribute to increased brand recognition and a wider reach within your target audience.
6. Ensured E-commerce Success – Loyal customers provide a solid foundation for the success of your e-commerce business. Their consistent support and engagement contribute to a stable and thriving operation.
7. Repeat Business – Loyal customers are more likely to return for future purchases. This repeat business not only contributes to ongoing revenue but also allows your business to build lasting relationships with customers, fostering a sense of loyalty that goes beyond individual transactions.

8 Ecommerce Customer Loyalty Strategies

Follow these eight practical strategies to boost customer loyalty for your online business.

Put customer service first

Invest in customer service to ensure you meet customers halfway. Customer-facing staff should develop skills like patience, empathy, and clear communication. The impact of a customer’s interaction with your business is significant. Research indicates that over half of customers won’t do business with a company after just one bad experience. Since people share their experiences online, providing excellent customer service can intervene and calm customers or resolve any issues that may arise.

Personalized Content and Product Recommendations

Provide content and product suggestions tailored to individuals. When brands offer personalized experiences, it tells customers that the brand understands their life and goals. Therefore, people tend to pay more attention to brands that seem to provide the most relevant content and products.

A study revealed that customers are willing to pay extra for personalized services. Additionally, more than half of customers are okay with sharing personal information like names and emails if it means getting personalized content.

Use what you know about customers, such as their preferences and past purchases, to recommend products. You can also leverage this information to share free resources like blog posts or videos, demonstrating that you understand what they’re interested in.

Provide Exclusive Perks

Offer special benefits such as discounts and free shipping to reward your customers. Giving them things like discount codes or free shipping vouchers can motivate them to make more purchases or spend more during each transaction on your online store.

Make sure not to hand out these perks too often; it’s important for customers to feel excited when they do receive them.

Depending on the nature of your business, you could provide these discounts a few times a year to encourage repeat purchases, especially for retail stores. For subscription services, consider tempting current customers with exclusive early-renewal discounts.

Give an Exclusive Look into Your Business

Share behind-the-scenes glimpses of your business to give people an inside look. It’s not just about what you sell; customers like getting to know the real side of your brand. Using a good content marketing strategy is key. Provide value through educational posts or exclusive sneak peeks into your day-to-day operations, showing customers that your focus goes beyond just making sales.

Develop a Loyalty Program

Create a customer loyalty program that’s hard to resist. Start by inviting new customers to come back to your store, then offer them a fantastic reward or benefit to aim for. One common approach is using a point system in your online store. Every purchase earns customers points that they can use as credit for future purchases or to get exclusive items from your brand.

Have a Retargeting Ad Campaign

Launch a retargeting ad campaign to remind customers about your products. If someone was checking out your website and looking at products, you can gently remind them on other platforms like social media. Sometimes, customers might have wanted to buy but didn’t get to it, or they plan to come back later. This online advertising method aligns with the trend of personalizing content and campaigns. Since customers already showed interest by looking at those items, it’s a way to reach out to them based on their preferences.

Abandoned Carts

Send reminder emails for abandoned carts. Recent data suggests that the average rate of people leaving items in their online shopping carts is around 79%. Customers might abandon their carts for various reasons, like losing interest or just forgetting to complete the purchase. Sending a friendly reminder email is a good way to let them know you don’t want them to miss out on a fantastic product they were considering buying.

Multiple Channels for Communication

Provide various ways for customers to reach out to your brand. By offering different options like email, phone, or social media, you make it simple for them to share comments, feedback, or questions. If your business can manage it, consider having live chat as a customer service option. Keep in mind that the easier it is for customers to contact you, the better their experience with your brand will be. Creating positive brand experiences is crucial for building customer loyalty.

Conclusion

For business owners, marketing and sales are ongoing tasks. It’s beneficial if you can encourage loyal customers to keep buying from you over the long haul. Combine the mentioned strategies with your other marketing efforts, like social media or outreach campaigns. This will assist you in retaining, nurturing, and turning customers into lifelong fans of your brand.