Business owners are mostly caught in the web of chasing the first-time buyers. This often leaves them at the potential risk of missing out on the major trick -leveraging the existing pool of customers to drive maximum sales.
For most retail businesses, repeat customers are where the business resides. According to existing data, repeat customers are capable generating more than 50 percent of revenue for small-scale and medium-scale businesses. In addition to this, as the process of acquiring more customers will cost almost 5 times more, loyal repeat customers tend to be around 10 times more worth in comparison to what they tend to spend during their first purchase. A study report stated that when you improve customer retention by only 5 percent, it can help in raising the overall profitability by around 75 percent.
While there are several benefits, it is not easy to get repeat business from customers. Moreover, with ever-increasing competition for harnessing the attention of retail consumers, it is becoming more difficult than ever.
Converting Customers into Repeat Buyers
Attracting new talent is always a challenging job. At the same time, it can also turn out to be an expensive process when you end up adding up the marketing and advertising costs. Indeed, you would not like to let them go after the single first purchase. You would prefer convincing them back again & again. Eventually, repeat customers are known to spend more money while contributing significantly to the bottom line.
Here are some tips to effectively convert one-time online shoppers into loyal, recurring customers:
- Build a Compelling Brand Identity: The retail business is not only focused on products but also on the overall brand value. This is why one clothing brand is effectively differentiated from the other clothing brand -even when there might not be major differences in the constitution of the respective products.
This is why brand identity is of utmost importance. Through the development of a compelling brand identity for your retail business, you are able to attract potential customers who will continue coming back only for the overall experience instead of the products itself.
- Ensure Frictionless First Purchase: One of the most important things to consider while ensuring repeat business is offering a pleasant and seamless buying and shopping experience. If a customer is frustrated the first time itself, you can be assured that they will not come back irrespective of how you are trying to win them over.
How will we ensure offering a frictionless experience?
- Ensure navigation the site and searching for specific products are quick and simple
- Checking out the website with the help of simple web forms, different payment methods, and a hassle-free flow
- Offering abundant shipping options along with next-day shipping and free shipping
- Processing orders quickly -not making customers wait to get access to goods
- Offer Discounts and Loyalty Programs: At the foundation of standard human behavior, there is a constant tendency to move towards rewards and gratification. Therefore, through the creation of programs wherein consumers can start receiving specialized privileges and discounts with a fixed number of purchases, you are able to create a dedicated pipeline for converting regular customers into repeat, loyal customers.
Leading retailers have already achieved this strategy through the creation of membership cards. Even leading airlines are known to reward regular flyers with frequent flier miles or airline miles.
- Communicate Through Email: You can draw the attention of new customers for signing up for your brand’s email newsletter by offering them proper discount on the first purchase once they subscribe. Once you have received the permission to reach out to them, you have a great opportunity to win over their trust and loyalty.
Email communication serves one of the best modes as it helps in:
- Keeping your brand at the top of the mind
- Announcing new products
- Telling your brand story and building a relationship
- Offering useful and valuable tips and other forms of content
- Sharing discounts, special discounts, and sales
- Offering personalized recommendations
- Announcing new products
- Getting customers back to the site with the help of a single click
- Ensure a Strong Social Media Presence: When you have a solid social media presence and plan, it can create the overall difference between customers leaving or staying. It is especially true when Gen-Z or millennials are your target audiences. Therefore, if you are selling online, you are expected to possess a strong social media presence.
You can commence by answering concerns or questions of the target audience. Ensure that customers who share positive things about your business are effectively recognized and rewarded. You should also aim at monitoring how customers interact with the social media channels of your brand through direct posts, hashtags, and mentions. Social media serves to be a great way when you wish to connect with customers in the form of humor.
- Offer a Dedicated Reward Program: Reward programs offer customers a reason to keep visiting your site or brand. Eventually, dollars, points, or stars -whichever form of reward you might choose, these can help in customers getting closer to the particular discount and a free product.
There are several brands that excel in this aspect. Retailers out there allow the respective users to choose how they wish to spend the earned reward points. Customers can go ahead with selecting individual products or buying with the help of coupons or discounts. In this way, brands get exactly what they would want out of a dedicated rewards program.
- Personalize the Overall Experience: E-commerce brands usually have access to the purchasing history of customers through the online database. Leverage this fact to your advantage by personalizing customer experiences depending on the respective purchasing history.
For instance, Amazon executes this strategy effectively by recommending relevant offers on the basis of products you have already ordered or viewed. This also helps in extending the overall customer communication. If you have access to the email newsletter, you can personalize the same by sharing relevant content like blog posts -depending on the previous purchases.
You can also look forward to connecting directly with customers and asking how to better personalize the overall experience. Make them feel special like an individual -instead of just a source of revenue.
- Offering Existing Customers Preferential Access to New Products: Rather than only dropping new products into the market, think of enabling existing customers to access as well as assess the product range. They can look forward to enjoying these products while offering constructive criticism wherever necessary.
This strategy helps in the creation of a stronger sense of belonging out of association with your brand. Additionally, it also helps in observing any flaws that would require mending before the final product gets exposed to the highly critical wider market.
- Building Relationships: From sending over a thank-you message for the first order of the customers to engaging them on social media and implementing honest feedback, there are several ways in which you can recognize as well as appreciate customers. The best retail brands are those that tend to be customer-first. Therefore, it is imperative for you to dedicate proper time to showing your customers that you care.
It helps in the development of genuine relationships while ensuring long-term loyalty. Drawing the attention of new customers only serves to be the primary step. You are also expected to build ample loyalty to ensure loyal and repeat customers.
- Keep in Touch with Customers: Personalization serves to be an increasingly crucial process in any business. Therefore, you cannot afford leaving it behind. Based on your business model, you can think of keeping track of the anniversaries and birthdays of customers while sending them gifts to commemorate the special events.
For instance, some brands offer birthday surprises to every member almost every year. However, it is not sufficient to simply remember the customers on their special events. You are expected to regularly reach out to them. Whether they are making a purchase shortly or through regular newsletters, customers would prefer knowing that you care for them sufficiently.
There is no denying the fact that repeat consumers are known to bring maximum impact at the bottom line of any retail business. The overall acquisition costs will be relatively less. The overall ROI tends to be increasingly higher. By securing around 20-30 percent retention only, retail businesses can make sure that they continue remaining profitable.