Acquiring new customers is crucial for any successful business, but it’s equally important to satisfy your existing customers so they keep coming back.
Customer retention helps businesses increase profitability by lowering the cost of customer acquisition. A critical piece of the customer retention puzzle is developing and maintaining a good understanding of the people who purchase your products.
If you use Shopify for your e-commerce business, the platform can help you do that.
“Shopify has awesome analytics tools to help you better understand your customers,” says Melanie Bedwell, e-commerce manager for OLIPOP. “Look at who your loyal customers are and what they’re specifically purchasing. This data can be leveraged to increase and maintain your customer retention numbers.”
Learn how to maximize your Shopify customer retention efforts in this article.
What is customer retention?
Businesses spend a lot of time, effort, and money acquiring new leads, so it only makes sense to ensure those leads turn into customers and stick around as long as possible.
Customer retention can involve a number of activities — including loyalty programs and email nurture sequences — but the strategies you’ll use will also depend on what stage your business is in. New businesses must emphasize customer acquisition as they build up their customer base, while businesses that are scaling up may want to spend equally on acquisition and retention. Well-established businesses can likely put more emphasis on retention over acquisition.
In addition to the stage of your business, retention strategies also depend on your industry and what types of products and services you sell. Companies that sell high-ticket items but have a low purchase frequency — a furniture retailer, for example — may benefit from a customer acquisition focus. However, those that sell high-ticket items and also have a high purchase frequency — such as fashion or electronics retailers — will want to amp up their customer retention efforts as much as possible.
Keep in mind that while many people believe customer retention is all about incentivizing buyers with things like discounts, it’s not all about offering perks. Sometimes it’s more effective to simply excel in your service.
“Your customers are your bread and butter. And yet, you’d be surprised how many e-commerce businesses make the same mistakes that prompt their customers to post bad reviews or switch to competitors,” says Kurt Ellis, president of GLF E-Commerce Fulfillment.
According to Ellis, the three most common customer complaints are out-of-stock products, late deliveries, and difficult returns processes. If you address these issues in your Shopify business, you’ll go a long way toward encouraging customers to come back.
What are some effective Shopify customer retention methods?
How can Shopify merchants convince their customers to purchase from them time and time again? Here are some strategies that may work for your business.
- Create a loyalty program. Almost any Shopify business can use this strategy. Build a loyal following of customers by rewarding them with VIP access, discounts, and swag as a thank-you for their purchases. The more times they visit your store, the more rewards they reap. “Use the Shopify app to create a special discount code for your VIPs, and include free shipping to clinch the sale,” says Bedwell.
- Improve your customer service. It can be hard to build a relationship with customers when you have an online business, but one way to do it is with excellent customer service. Customers want quick, clear, and succinct answers to their questions; if you can provide them in a friendly way, they’ll remember it next time they need your products.
- Make it easy for customers to leave reviews. Who do customers trust more than your company? Other customers. Make it easy for people to leave reviews of products and customer service interactions on your site so buyers are motivated to visit your store again.
- Offer referral rewards. Similar to reviews, referrals are a great way to build customer retention. Offer rewards to customers who refer their friends and family, and offer those new customers the same deal. This way, you begin the relationship with a solid foundation of trust.
- Encourage customer accounts. Creating an account on your Shopify store may be a big commitment for customers, but it makes return shopping that much easier. Their payment and shipping details are already on file, so all they have to do is pick which products they want next. You can also use these accounts to reduce cart abandonment.
“Help your customers recover their abandoned shopping carts by emailing them through Shopify in an engaging way. It’s very effective,” says Bedwell.
Are you ready to get your customers to keep coming back to your store? With these Shopify customer retention methods in mind, you can satisfy more customers and make your business more profitable.