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Ideas for Customer Retention During Uncertain Times

Companies around the globe are making efforts to sustain through this period of downturn. But how to do that in the present market conditions? E-commerce companies and virtual enterprises are seeing traction like never. The global pandemic COVID-19 is forcing other companies to consider digital transformation. There is a heightened effort by companies to run brand recall campaigns through different marketing strategies.

But, how successful will that be in the long run? Can companies sustain doing campaigns without a return? When is the ROI going to happen? These are unanswered questions during an uncertain time.

We suggest that all businesses invest their time in retaining and nurturing their existing customers and increasing their purchasing frequency and enhancing the customer experience.

This is important for two main reasons right now:

  • Returning customers can turn into brand advocates and increase referrals.
  • The cost of retargeting an existing customer will be way lower than the cost of acquiring a new one in 2020.

Understanding the Power of Existing Customers

We interviewed Sarah Donnelly, Marketing & Communications Director at Blick Rothenberg, and here’s what she has to say-

“Existing customers can be a rich source of future orders for your business. It is, however, essential that they always have a positive and consistent experience of your brand, whether online or in person. Treat your customers well and support them through their challenges and they will become your ambassadors. No one sells ‘you’ better than a happy third party who has enjoyed engaging with your brand and feels brand loyalty – but like any form of trust, this loyalty has to be earned.”

Existing customers are crucial for many reasons. They make up 40% of the average store’s revenue. Many companies focus on customer retention because it is much easier and cost-effective than continuously looking for new prospects. The cost of acquiring a new customer is five times the cost of retaining one who has made a prior purchase.

Not only is this approach more lucrative, but it also requires less work since those who have purchased from us earlier are likelier to buy from us again. The probability that an existing customer will purchase from a business again is as high as 60-70%. On the other hand, new customers only have a 5-20% likelihood of purchasing something from a business the first time.

So, armed with this knowledge, should you focus on getting repurchases through large ticket items or small ticket items?

Larger ticket items seem like more bang for your buck. We’ve found it hard to increase the purchase frequency of customers when we need them to shell out more dollars per purchase. Repeated trials and errors indicated to us that by boosting the purchase frequency of one customer, we can raise the rate of each lead. In doing so, making smaller, more frequent purchases becomes twice as important for revenue growth than fewer large-ticket orders. For every 1% increase in purchase frequency, companies can see a 2.8-point increase in revenue.

First-time customers spend about $1.73 per transaction, but the more they buy from you, the more that ticket number grows. The median sale for repeat customers is a whopping $10.67.

Creating Strategies for Retention

When changing focus to existing customers, we’ve begun to follow a cheat sheet of sorts, certain formulae that have worked for us time and time again. Here are a few of our strategies that have proven successful.

Make It Easier to Place Repeat Orders

Add value to customer’s journey by providing them with access to their past orders and pre-filled forms for shipping which makes their shopping journey easier and more efficient. Make sure they’re incentivized to choose your website over another. We usually get them to create customer accounts after their initial order to gain access to their order history.


Use Customer Support to Convert A Sale

When speaking to customer support executives and hearing the kind of feedback and complaints they receive frequently, we’ve noticed an opportunity that can be leveraged to upsell/cross-sell.

Developing a fast, helpful, and consistent customer support system lets customers feel valued, cultivates brand advocates, customer loyalty, and repeat shoppers. Using a live chat or another easily accessible tool can be used to settle grievances or even efficiently convert customer questions into a sale.


Offer Discounts or Credits to Return

Discounts are a practice many warn against because they can decrease the value of products in the eyes of customers or lead buyers to expect low prices continuously. In the end, both scenarios can leave a business with lost revenue and no guarantee of repeat customers.

But, incentives like discounts or store credit, if used correctly, can attract first-time customers to return later. For example, we have found that sending them a special offer or discount after their first purchase, attracts them to return. While that might seem like an unneeded expense at first, we view it as an investment since a returning customer has a 54% chance of coming back yet again for another purchase.


Craft Great Loyalty Programs

Loyalty programs promote purchase frequency and increase transactions by exciting customers to spend more to earn valuable rewards. The best loyalty programs benefit both customers and the business.

An effective way of increasing e-commerce customers’ purchase frequency is by crafting a loyalty program that rewards frequent orders and compels shoppers to return regularly. Gamifying a loyalty program or utilizing social media in the form of a buyer’s club, often increases customer engagement. It will allow them to immerse themselves into the business. Repeated interactions could mean greater loyalty and thus, more chances of frequent dollar spend.

Increasing Customer Purchase Frequency

Create Micro-moments

When thinking of the customer journey, we stumbled across three primary moments when a customer can be called to take action:

  • Right after purchase, such as with a confirmation email
  • When they have experienced almost all the value from their first purchase
  • After a span of inactivity

Capitalizing on these moments with personalized emails, or a mass message to a targeted group can offer just the trigger for another purchase. In the case of a confirmation email, you know you have the customer’s attention because they are highly likely to check their order details. This opportunity can be used to include bonus offers, recommendations for accessory products, or other things they might like.

Target Customers Wherever They Are

The internet is a vast space. Our target customers usually fall into certain demographics and their preferences can be largely bucketed into a few categories. It means that if we put in the effort, we can find out who our customers are and where they spend their time when online.

Placing ads of complementary products for recent purchases or product upgrades for older purchases on the websites or platforms that they spend time on, is a good way of reaching them even when they’re not thinking about our business or brand.

Offer Subscription Models

A clever way to ensure longer customer interactions is to break up the payment of a product or service offering by using a subscription model. Many times, we’ve found that customers are hesitant to make a high-ticket purchase.

Customers find it easier to digest smaller payments over multiple transactions, than a single large payment. So, in this scenario, offering a subscription plan has been a great value addition that has drawn customers to us and away from our competitors. This will keep them engaged with us over multiple transactions for a long period.

Increase Excitement Through Limited Time Offers

Fear of missing out, or FOMO, is core to the most lucrative special offers because they spark urgency through limited availability. FOMO comes in several forms, whether it’s a limited time frame or limited quantity.

They can be a seasonal sale, sign-up bonuses, birthday rewards or discount codes for future orders with an expiration date.


Tweak Your Business Proposition

There are plenty of marketing strategies that can be devised to retain customers, however, sometimes no matter how much the budget is spent, customers just do not return. It might be prudent at such a time, to go back to the drawing board, and assess the type of products that you are offering to the market.

Some products such as consumables, things that experience wear and tear, or routinely upgraded products organically induce repeat sales. But with high dollar products, adopting a strategy for selling complimentary products might be the way to go. Complementary products are comparatively inexpensive and need to be used with the primary product and are the perfect opportunity to leverage a strategy of cross-selling.

Sarah Donnelly, Marketing & Communications Director at Blick Rothenberg, and her views on tweaking business proposition-

“Any business can adjust their proposition to target more customers, by simply looking at the core offering and adapting it slightly for a new segment. That can be done by adding complementary products or services to make it more appealing to this new audience, or by creating a campaign that tailors your product or service to that unique audience without inherently changing the product or service itself.

There is another option, however, which is to find a completely new use for your product, repackage it and market it separately. You only have to look at the clinical looking hemorrhoid creams, that manufacturers have now repackaged as a revolutionary, luxury beauty product that tightens eyes and is beautifully packaged to see that.”


When changing the focus to existing customers, you must not forget the importance of assessing how well your strategies are performing, else it all might just be wasted effort.

Setting up analytics systems and getting an immersive view of the customer’s journey will provide you with consolidated data about your customers. It will be from across your platform as well as other sources, which will enable you to make better strategic decisions.

Also, set-up a baseline to identify where the current customer purchase frequencies stand, and where you would ideally like those numbers to be. By doing this you’ll be able to properly evaluate what is working and what is not.

Existing customers are more likely to spend extra dollars on your products and keep your retention rate strong. Their lifetime value keeps increasing every year they stay with you, and they are likely to refer others to your brand too. All this is going to help you spend less on acquiring new users. So, its time to sharpen your marketing strategies and put your time and budget on retaining your existing customers!

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