You’ve heard it time and time again. It’s cheaper to get past customers to purchase again than it is to find new customers. This is true for most businesses, especially in the crowded online ecommerce arena where ad impressions, clicks and conversions always seem to be increasing in cost, making new customers more and more expensive to acquire.
Knowing that it's cheaper to get current customer to purchase from you again, ask yourself, when was the last time you truly made an effort to re-engage your current customers to get them to come back?
In today’s post, we will look at seven strategies to target your current customers and get them to purchase more often.
Let’s find out how.
Benefits of Reselling to Current Customers
There are several benefits to reselling to previous customers versus acquiring new ones. First and foremost, as mentioned in the intro, it usually costs less. That alone is reason enough to spend more time focusing on your current customers, however, there are additional benefits as well.
According to the book Leading On The Edge Of Chaos, customer profitability rates tends to increase over the life of a retained customer and a two percent increase in customer retention has the same effect on profits as cutting costs by ten percent.
Finally, the more times a customer purchases from you, the stronger your relationship becomes. It’s these strong relationships that cause customers to champion your products and services, effectively creating powerful referrals and word-of-mouth marketing that will help drive new customers.
So now that we understand why focusing your energy on your current customers can be more important than acquiring new ones, let's look at some ways to increase conversions amongst your current customers.
1. Utilize Customer Accounts
Customer accounts can be a double-edged sword. On one hand, accounts can make repurchasing much easier by giving customer easy access to past orders as well as pre-filled shipping information. On the other hand, customer accounts can be a seen as too big of a commitment for new customers. Because of this, most people will choose to checkout as a guest if given the option
So how can you effectively implement and encourage customer accounts while not hindering conversions of first time customers? The trick is to provide the option to create an account after the first order has been placed.
2. Implement a Customer Loyalty Program
Further developing on the idea of customer accounts, is to reward customers for their loyalty. Developing a loyalty membership to your store is another way to increase conversions from your current customers while rewarding them for their repeat purchases.
Creating a loyalty program can be as simple as rewarding customers on their second purchase at your store or after a set dollar figure. Your store reports makes it easy to see who your best customers are by dollar value and total number of orders:
If you're too busy or your customer list is too big, there are ways to also automate this with Shopify apps such as Klaviyo which can automatically email your customer a reward coupon when your customers make a repeat purchase from your store.
Additionally, you can opt for full featured and automated loyalty apps like SLoyalty and LoyaltyLion which can reward your customers for a variety of actions they take in your store, including creating a customer account, referring friends and making purchases.
3. Send Regular Customer Newsletter Emails
Your email list is a critical tool for maintaining and building relationships with your current customers. Time and time again email has proven itself to be one of the top converting channels for ecommerce. Take a look at the graph below from Monetate. It's clear that email converts much higher than social and close to twice as high as organic search:
An email marketing campaign like this to all of your customers is quick to implement and can produce big gains.
For best practices when sending out newsletters, check out our post on Email Marketing: A Guide To Ecommerce Newsletters.
4. Surprise & Delight Your Customers
Depending on your niche, product mix and margins, sending a small gift to your best customers can be a great way to remind them to come back while adding the element of surprise and delight.
Giving an unexpected gift also plays to the law of reciprocity which refers to responding to a positive action with another positive action.
Use this to your advantage but sending your best customers small and unexpected gifts. It can be as simple as a digital gift certificate to your store, or you can take it a step further and send your customers something that lets them know you you went the extra mile because they are important to you.
Consider this post from Reddit where the owner of an auto body shop sent out a hand written note to thank a previous customer:
The customer was so impressed with this small gesture, he posted a photo to Reddit, which ended up receiving over 1,500 up votes and nearly 800 comments. So not only did this one hand written thank you note likely create a customer for life, but that customer also became an incredible referral marketing channel, broadcasting the incredible service from Jimyz Automotive to tens of thousands of people.
In another example, Brandon Eley, founder of 2BigFeet.com posted the following photo in private ecommerce group:
He went on to explain:
A customer appreciation campaign like the one from 2BigFeet has the ability to produce massive results and can be done with a very small financial investment for the cards and just a small time commitment to write and send them.
5. Reach out and Connect on Social Media and Post Often
Social media is all about building relationships and who's better to build and cultivate relationships with than your customers?
People who have chosen to ‘like’ or ‘follow’ your company tend to 'like' or 'follow' your brand for a reason. Many times, these people can be your most loyal customers and brand ambassadors. They want to hear more about new products and promotions so it's important to use these channels regularly to make sure your connecting with these people and driving them back to your store often.
Keep in mind that Facebook only shows your posts to 5%-10% of your total fans. This means, you should be posting often enough so that you're regularly reaching all of your fans and customers. Different experts will have their own opinions as to exactly how often that is, generally, 1-2 times per day is a good base number to work with, however, you should always pay attention to your pages engagement and unlikes and tailor your posts to your audience.
6. Offer a Discount or Credit to Return
You want to be careful with discounting your products. For many ecommerce merchants, margins can be tight and if your customers become accustomed to discounting they may expect it all the time. However, discounting can also be a really effective trigger to bringing back customers that haven’t purchased in a while.
You may also wish you experiment with offering credits to use at your store (i.e. $10 towards any purchase) versus a percentage discount (i.e. 10% off any purchase). The credits make the offer feel more tangible and makes the customer feel like they need to spend it, otherwise they are wasting money.
Sending out discounts to dormant customer can either be done manually is you still have a relatively small customer list, or, it can be automated through email apps like Klaviyo discussed previously.
7. Implement Right Place, Right Product, Right Time Emails
If you know have a product that is perishable, consumable or otherwise breaks down, degrade or needs to be refreshed over time, knowing your products lifespan and sending well-timed emails can be the perfect and very logical way to bring back dormant customers. This tactic can be particularly effective because in theory, you’ll be delivering the right message to the right person at the right time.
For example, Luxy Hair mentions in their FAQ section of their website that their hair extensions will last 4 months to one year depending on wear:
Knowing this, Luxy could set up a series of automated emails to go out after four months, eight months and one year that explain to their past customers the benefits of a fresh set of hair extensions. These emails would help educate the consumer, keep Luxy top-of-mind and encourage repeat business from past consumers all while providing the customers with a great experience.
There you have it. Your current customer is the best asset your store has. They already know your brand, they know your products and they know your service. Focusing your time and energy on this group as oppose to always always trying to find new customers can be a powerful way to supercharge revenues for your store, especially over the holiday season.
About The Author
Richard Lazazzera is an ecommerce entrepreneur and Content Strategist at Shopify. Get more from Richard on Twitter.