We’ve all been told that retaining customers is easier than attracting new ones. But have you been told that it’s better, too? Gaining new customers is always great! However, it can be much more cost effective to work on keeping the customers that you already have.   

Benefits of customer retention

Customer retention is the act of keeping customers, meaning they return to your store time and time again. There are many benefits to this, many of which are monetary and attribute to the success of your store.

Provides a higher return on investment

How do you find new customers? Do you run ads? Invest in influencers? Pay a marketing expert? Repeat customers create a higher return on that investment.

When someone shops with you again and again, they increase the value of that initial ad or marketing spend!

Let’s say you run an ad with a cost per click of $1. Two customers click it (your cost is $1.00 for each of those clicks) and make purchases totaling $35.00 each. That means your return on each of those investments is $34.00.

One customer never returns to your store after making that original purchase, while the other customer comes back and shops with you three more times that year.

Which customer is more valuable and creates a higher return on that initial $1.00 investment? The customer who places one $35.00 order (total return of $34.00), or the customer who returns three more times and spends a total of $35.00 x 4 (total return of $139.00)? 

Clearly, the returning customer provides a higher return on the investment. 

Creates larger customer lifetime values

Much like the higher return on investment mentioned above, repeat customers have a larger customer lifetime value.

That is the goal!

Customer lifetime value is the amount that the customer will spend over the course of their relationship with your brand. 

The higher that amount, the better. Loyal customers’ lifetime values are generally much larger than that of one-time purchasers’.

Learn more about customer lifetime value here.

More loyalty = more referrals

The more a customer trusts, loves, and believes in your brand, the more they are inclined to share that brand with others. 

And guess what — word-of-mouth referrals work. It’s why influencer marketing has become so big. To put it simply, people trust people! Hearing about someone’s experience is much more effective than seeing an ad.

The more loyal customers that you create, the more word-of-mouth referrals will come your way. 

While we’re on this topic, reviews can also be incredible for your brand. Have you read our post on how to get customer reviews?

2023 customer retention strategies

Earlier this year we shared 6 ways to increase customer retention. Those included seamless ordering, great customer service, top-notch shipping, rewarding loyalty, referral programs, and creating personal relationships. 

While we recommend continuing with all 6 of those very effective tips, let’s look at some 2023-specific customer retention strategies that you can include in your marketing plan for the upcoming year.

Offer subscriptions

The first 2023 customer retention strategy that you should consider for your store is subscription-based ordering. 

Have you shopped online for beauty or health products this year? If so, you may have seen an option to set up a recurring order and shipment.

This subscription style has become a very widely offered option in consumable industries like health, beauty, and wellness.

At checkout, customers are given the option to make a one-time purchase, or they can select a subscription.

The benefit of the subscription is that not only is your order automatically made and shipped to your door, but companies often offer a discount and free shipping along with this option.

In this scenario, both parties benefit. The customer gets a discount and free shipping (and doesn’t have to remember to make a replacement order), and the company gets another sale.

If your e-commerce products apply to this model, consider implementing a subscription option in the new year. This is a method that you can expect to see offered more and more as time goes on!

Send a recurring newsletter

Newsletters are a great way to retain customers. It’s a tried and true marketing method that we recommend sticking with in 2023. 

With a regularly occurring newsletter, you have the ability to give customers store and business updates. You can share what you’re working on, what they can expect to see soon, and product listings that they may enjoy. 

A newsletter is a great way to give customers the option to get to know your business a bit better, and it doesn’t hurt to use it as a promotional tool either! Try to find a good medium in your newsletters that combines providing value and promoting products.

Make shopping more of an experience

A great way to encourage customers to come back is to make shipping with you an experience. Think about what your favorite brands do, and then do that times 10. 

Can you improve your packaging to make opening a shipment fun and exciting? Throw in freebies like stickers or postcards as a fun surprise? Include a handwritten thank you note to personalize the package and remind them how much you appreciate your order?

Work to implement any method that will elevate the shopping experience. Not only will customers appreciate this, they’ll also be more likely to share it on social media! You may even find your store getting tagged in an unboxing or two.

Create an app for mobile shopping

Mobile shopping apps are store-specific apps that provide a more user-friendly experience than regular mobile websites. This is because many e-commerce stores design for desktop first, and the sites don’t function as well when used on mobile.

Have you downloaded a store app, such as Target? You may have noticed that it’s much easier to shop than if you used target.com in your mobile browser. That is because the app is made specifically for the mobile shopping experience.

Mobile shopping apps are on the rise, and it’s worth investing in if you want to stay ahead of m-commerce (mobile-commerce). These apps make shopping much more convenient, which makes customers more likely to return.

Give back

Does your company give back to the community? If not, consider starting. Not only is this a fabulous way to pay it forward, it’s also something that gets customers excited. 

Perhaps you can donate a percentage or dollar amount of every sale to a charity of your choice. Or, maybe you can make an annual contribution to a program. 

Doing so shows that your company cares. And when customers know that a portion of their sale is going to help others, it makes them happier to purchase. 

Which of the above methods are most excited to implement in 2023?

 

 

 

 

 

 

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Yours in success
Sarah x