Quarterly Learnings Report: Customer stories and lessons learned, delivered quarterly
eCommerce Retention: 5 Actionable Strategies (Plus Examples)
eCommerce retention seems like a fairly simple on the surface: If you have a great product and deliver great service to your customers, they’ll want to stick around. Right?
It turns out that modern consumers aren’t quite as easy to retain as you might expect. In fact, data shows that as many as 33% of shoppers aged 23-38 are quick to drop a brand that doesn’t rise to meet their expectations.
The reality is: When it comes to eCommerce retention, you have to give your customers a reason to stay. It takes some real work.
So what should you be doing?
Let’s look at some actionable strategies for eCommerce retention that’ll help you keep more of those customers you’ve worked so hard to earn.
Strategy #1: Allow customers to delay/pause recurring orders or subscriptions
For eCommerce brands with subscribe and save models, nine out of ten times the most common reason for churn is "too much volume." These customers are still fans of the product, they’ve just stockpiled too much--and so they decide to cancel.
To address this, it’s a good idea to make it easier for people to delay their orders. It sounds counter-intuitive to ask a customer to pause/delay an order, but instead of canceling, data shows people who skip have a 60% likelihood of processing on the next renewal, about 30% will skip again, and only about 10% will end up cancelling.
This is major for eCommerce retention.
So how do you do this? Wilson Hung, Head of Growth at Kettle & Fire, says that one way is to leverage upcoming order emails that make it easy to delay an order.
This brand has made huge strides in the realm of customer retention by implementing this approach.
How do you do it? An app like GetARPU makes this simple to set up and automate. Using this tool, you can leverage pre-shipping email reminders that notify customers three days before their next billing cycle and give them the flexibility to pause or delay a shipment (rather than to cancel and churn.)
Strategy #2: Apply best practices in failed payment recovery
One of the simplest ways to improve eCommerce retention is to address one of the biggest reasons for churn: Failed payments.
The good news is that with a tool like Churn Buster, you can run advanced followup campaigns to recover any failed payments with the help of optimal retry schedules, email timing, scheduled actions and more.
You’ll be able to clear more payments without bothering customers with unnecessary emails and adding support costs or cancellation risk.
A few of the best practices in dunning include:
- Tailoring recovery campaigns to your business model and leveraging your customer knowledge.
- The idea here is that you’ll treat dunning campaigns like a marketing campaign or funnel. In doing so, you capitalize on the opportunity to turn a transactional email into a conversational one.
- Escalating urgency with a variety of email subject lines that don’t all get threaded together.
- Sometimes these get lumped into a hidden folder, so varying your subject lines and expressing importance here will help these stand out within the noise of a customer’s inbox.
- Using creative solutions to engage non-responsive customers before they churn.
- Example: Add in SMS nudges for non-responsive customers. If a customer is in a dunning campaign, Churn Buster can add in a SMS step where the customer gets a text about the payment issue.
Strategy #3: Use email to educate and onboard your first-time buyers
If your product is one that has a bit of a learning curve when getting started, education and onboarding are critical if you want to master eCommerce retention.
Without it, customers may never see the real value in what your product has to offer--and they may simply churn.
CBD brand Feals has mastered this for first-time buyers who are curious about their product and order the “flight” option, which includes a “flight” of three different CBD dosages for a new customer to try.
As part of the onboarding for these new customers, Feals uses a series of post-purchase emails that work to educate them and get them acclimated to what they're about to receive.
With helpful tips and a bit of teaching around how to use the product, these emails help ensure a positive experience and buy-in before the product even arrives.
At the same time, they help boost loyalty and retention by helping customers achieve activation, wherein they fully realize the value and benefits of the product firsthand (and can’t live without it.)
“We've found that keeping the conversation going prior to product arrival keeps our new customers engaged,” said Drew Todd, Co-Founder of Feals.
Strategy #4: Leverage a rewards program to incentivize eCommerce retention
Jacklyn Temares, Retention & Loyalty Marketing Manager at accessory brand MZ Wallace, explained that their rewards program, called MZW Rewards, is a multifaceted program they’ve created that offers benefits to the brand’s already-loyal customers and encourages loyalty from new or otherwise less-frequent shoppers.
Members earn points on every purchase, which are then redeemable on additional purchases throughout the year.
Rewards members also receive exclusive monthly perks (like early access to new launches, gifts-with-purchase on select items, and surprise double-points days.)
By constructing the program as a tiered system, retention and repeat purchases are incentivized as customers reach higher tiers and they unlock more and more benefits.
YuJin Yong, the brand’s Senior Director of Direct to Consumer, shared that the results of this program to date show 79% of their returning customers are MZW Rewards members and
57% of returning MZW Rewards customers have made three or more purchases.
Personalization is key to the success of this program, as it allows the brand to pull customers’ available Rewards points into its email marketing campaigns to remind them when they have balances to spend.
“We’ve also implemented automation — triggering the right content at the right time based on what products or categories users are browsing, or are likely to browse and buy,” Temares said. “Both personalization and automation have allowed us to reach all of our customers in a unique way that suits their needs and provides a more tailored, satisfying experience for them.”
Strategy #5: Create a stellar unboxing experience
Because Farmgirl Flowers doesn't have a large budget for ads and retargeting, most of their retention efforts focus on generating positive first impressions via an impressive, surprise-filled unboxing experience.
The theory: By making the customer experience special and memorable, customers will keep coming back to buy the brand’s flowers again and again. It’s a smart move, considering data shows that experience-led companies have 1.7x higher customer retention rates than those who don’t put the customer experience first.
So what’s the unboxing experience like for Farmgirl Flowers actually like?
- The arrangement comes in burlap wrapping and has a signature chipboard luggage tag attached with branding and care instructions.
- Care cards help to section out important information and allow the customer to learn about the brand. There’s one card with info solely about Farmgirl and their business model, one on how to take a good IG photo, and one a care card specific to the arrangement or plant they're receiving.
- Recipients get a free lapel pin that will live beyond the bouquet and reflects the founder’s personal story.
“Our ethos here is that we have literally thirty seconds with the purchaser but so much longer with the recipient. We want the unboxing to feel like a fun discovery experience, so we give the customer different ways to engage and enjoy the process of opening their present,” said Christina Stembel, Founder and CEO of Farmgirl Flowers.
Master eCommerce retention & delight your customers
By implementing the eCommerce retention tactics outlined here, you can get on the path to lower churn, higher retention rates, and overall happier, more delighted customers.
From failed payment recovery best practices to memorable customer experiences and beyond, you now have plenty of ideas that can inspire your future retention efforts. All that’s left to do is to put them to work.
This is a guest post by Kaleigh Moore. Kaleigh Moore is a freelance writer specializing in content writing for ecommerce platforms and the software that integrates with them.