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How To Improve Customer Retention For An Ecommerce Store ?

A high customer retention rate is one of the most important tools of growing a business. In fact, returning customers are the key to any business’ long-term success. Bain & Company gives 3 major reasons as to why e-commerce business owners should focus on customer retention –
- Customer acquisition costs in e-commerce are high
- Repeat buyers spend more and make larger transactions
- Returning customers refer more people and boost business
In the e-commerce business, acquiring new customers might look like the most obvious way to bring in revenue. But it’s not necessarily the smartest method for generating more sales. Sometimes, online store owners get so caught up in advertising and attracting prospects that they ignore the fact that the single best way to make more sales is to leverage your relationships with customers who have already brought from them.
Focusing on your current customers not only helps your business grow over time but also helps cut down on expenses that would have been spent on advertising and other marketing strategies.
In this blog, we have outlined four factors that e-commerce business owners should focus on in order to achieve high customer retention rates –
Unparalleled Customer Experience
Just like the founder of the American multinational technology corporation – Apple Inc. said,
“You’ve got to start with the customer experience and work back toward the technology, not the other way around.”
If merely selling goods and services was enough, the abbreviation CX would never have been created. Just think about it, there’s so much discussion about customer experience out there that some maven felt the need to shorten it for simplicity.
Customer experience has become a point of differentiation for businesses. The better the experience, the more the customers cling on to your brand. So, what can you do to blow customers over with a matchless experience?
Let’s learn from the A-gamers in the industry.
Personalization is not an option anymore
Do you and your friend see the same product recommendations on your homepage when you log in to your Amazon accounts? No. That’s because Amazon takes good notice of what you’ve bought, what you’re buying & what you’ve been looking for and makes suggestions accordingly.
Amazon’s product recommendation engine is not new and has made it to the headlines several times. Nonetheless, every time the e-commerce giant suggests a product to its customers, there’s a fair chance that the product gets sold out. In fact, a McKinsey report reveals that 35 percent of Amazon’s sales come from such recommendations.
This is the kind of personalization that you need to take inspiration from – subtle yet thought-provoking. Amazon doesn’t limit itself to just suggesting products. It allows users to filter what’s being endorsed to them and even offers reasons as to why the product is being recommended. That’s the kind of personalization customers look forward to and that’s the kind of feature you need to add to your e-store to keep customers coming back.
Offering exceptional customer service
Customer service is an important part of CX. Only if you handle your distressed, confused, and unhappy customers well, you’ll be able to build a strong relationship with them.
One brand that goes above and beyond to offer unparalleled customer service to its customers is Starbucks. Following their mission statement, Starbucks is all about connecting with their customers.
Starbucks leverages its social media channels to connect with customers. More than just handling the negative criticism from customers, its employees make an extra effort to not only know regulars by their names but also by their food and beverage preferences.
As an e-commerce store owner, there are various ways in which you can provide exceptional customer service to keep your regulars. From deploying an AI-enabled chatbot on your e-store to offering customer support services via your social media channels, you can impress your customers just like Starbuck does!
Rewarding Loyalty Programs
Loyalty Programs are by far the best vehicle to boost relationship with customers and to get customers coming back. Rewards programs are known to escalate purchase frequency by motivating customers to buy more often from the brand so as to earn valuable rewards.
Such programs offer a profitable exchange for both business owners and their customers.
Brands inspire customers to continue investing in the program by awarding them welcome points. These points motivate customers to shop again to avail more points and brands can benefit from their repeat business.
Sephora leverages its loyalty program to increase its customers’ value. As one of the most renowned rewards programs in both the retail and e-commerce loyalty communities, Sephora’s Beauty Insider has made it to the top loyalty program lists several times.
So, what is it about the brand’s reward program that makes it so popular among customers and retailers alike?
First, Sephora makes use of the tier-based system effectively in its rewards program offering exclusive perks to upper tiers and motivating customers in subsequent levels to spend more in order to reach to the highest point. And secondly, they have created personalized product recommendations for Beauty Insider members to offer them the best shopping experience.
By this they’re doing both – inspiring customers to buy more while giving them a shopping experience that’s ‘worth it!’
Engaging Email Campaigns
If you want your customers to keep coming back to you, you need to keep in touch with them. Popping up regularly in your customers’ inbox is the best way to remind them that there’s more awaiting them at your store.
Emails provide brand the opportunity to interact with customers before and after the purchase. Each message sent, works toward cementing the bond further between the brand and its audience. If that kind of communication fails to happen, there’s a high risk of customers going away.
There are reasons as to why email campaigns work so well for e-commerce establishments.
- They help brands improve their interaction with customers
- It is considered one of the least expensive forms of communication
- It is easy to use given you take the assistance of a resourceful email service provider
When it comes to customer retention, it’s crucial to start the relationship off on the right foot. One of the best ways to do this is to give a warm welcome to a customer as they join (like you would in a physical store) with a welcome email.
A welcome email can speak a lot about your brand. It can give the customer a sneak-peak into how good your offerings are and the kind of service you can offer them. Additionally, you can guide the customer into taking the next step with a thoughtfully-crafted first email. Once this initial follow-up has been sent, keep on sending tailored messages regularly to keep your customers updated and informed.
Beard King – the beard care and grooming products provider send out personalized emails to its customers every two to three weeks, keeping them informed about new products or sales. The emails offer additional product recommendations, invite customers for upcoming sales, and promote new products, thereby keeping new customers intrigued and informed about what’s coming next.
Seamless Omnichannel Experience
As a modern-day retailer dealing with tech-savvy customers, one should understand the need of opening up every door possible for your customers to walk into your store and shop from you. But then of course, in the current context, the doors to your offline stores have been replaced by the channels to your online store.
Smartphones have revolutionized the e-commerce landscape. And if retailers fail to understand that ‘’mobile-friendly equals customer-friendly’’, they’re doomed. A Salesforce research revealed that 70% of customers say connected processes are very important to winning their business. It also states that customers are 3.7X more likely to perceive seamless transitions between channels as important.
If we picture the above data, here’s what customers exactly expect – They want to be able to browse the products online, download special offers to their phone while they look at the products online, and share their purchase as well as views about the product on social media. This simply means that they expect to be able to interact with your brand on every channel possible.
A mobile-first strategy should be on the top of every modern retailer’s to-do list. Meeting the customer where they are the most will not only enable you to interact with the customer easily but will also give the customer an easy access so that they can come back to you whenever they want.
Returning Customers Are Your Best Asset
The digital ‘new age’ customers are empowered with more choices than ever and make customer loyalty more challenging for brands to achieve. There’s no magical solution for keeping customers, particularly in times of so much change. Therefore, you should start a practice, today, of learning more about your customer with every interaction.
It’s important to keep the customers who know your brand, know your products, and appreciate your service. If you focus your time and energy on providing exceptional customer experience to this group in the best way possible, you’ll find your business growing in no time.
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