4 Strategies for Ecommerce Customer Retention DTC ecommerce brands are on the hunt for new revenue channels, but they're looking in the wrong part of their customer journey.
By Gabriella Tegen Edited by Micah Zimmerman
Opinions expressed by Entrepreneur contributors are their own.
One of the most critical areas for brands to audit is the cost of acquiring new customers compared to the cost of retaining existing customers. According to Shopify's latest Future of Ecommerce report, "it's becoming tougher to get a decent return on advertising spend, with the cost per click for paid search ads increasing by 15%." Similarly, garnering organic traffic has become increasingly challenging, making attracting new customers more complicated and costly.
The most untapped method to grow your Direct to Customer (DTC) brand is with an exceptional customer experience and post-sales strategy. Nurturing your existing customers extends lifetime value and accelerates the likelihood of customers sharing the love with friends and family, causing a compounding brand affinity effect.
Given today's crowded digital landscape, inflation and the increasing cost of customer acquisition, it only makes sense for brands to double down on their existing customers and go above and beyond to nurture that relationship.
Related: 10 Customer Retention Strategies That Supercharge Your Marketing
Focus on your customer's wants and needs
The foundation of a healthy post-sale strategy is to deeply understand who your customer is, what roadblocks they face and what they aim to achieve. "The need to focus on your customer may sound like a given, but consider how easily a competitive focus can supplant customer needs if this mindset is not core to every decision," explains Ben Downey, COO of Smartrr.
Instead of making the costly mistake of fixating on competitors, I strongly urge DTC brands to immerse themselves into their customers' world, focusing on how they can fill essential gaps. Not only will this keep you apprised on how to meet their evolving needs, but it will also cause you to become the leader in developing innovative solutions.
Speak your customer's language
Just as people don't buy the plane ticket but the vacation, people aren't buying your product; they're buying the value they think you'll offer. There is no better way to deepen your relationship with your customers than to consistently engage them through compelling content. Value-based content is the lifeline of a DTC brand. Whether you aim to educate, inform, entertain or simply delight, the longevity of your brand will be determined by how well you can resonate with your audience and reaffirm your understanding of their wants and needs.
A brand that I find does this exceptionally well is Earthling Co. They focus heavily on content that educates their audience on natural ingredients and clean beauty. Earthling Co understands that its audience resonates with sustainability. As a result, they create ongoing content — blogs, social media posts and research — bringing greater awareness to clean beauty and organic ingredients, keeping their audience engaged and in tune.
A healthy post-sale strategy will consist of a steady drumbeat of value-driven content, text messages, emails, blog posts, imagery and videos that speak to your customer. When your customer sees value in your brand that transcends the product, you have successfully created a sustainable bond that will result in long-lasting brand loyalty.
Offer exclusive member perks
Your subscribers are your most loyal customers. Treat them as such. Roll out the red carpet with loyalty programs, rewards, exclusive discounts and exclusive access to upcoming products.
Approximately 75% of shoppers are more motivated to shop when they have incentives and rewards. How you can incentivize your customers is limitless — depending on your business, the frequency and offer will vary. While some brands may see more return on a BOGO rewards program, others might opt for free shipping on orders over a certain dollar amount. To decide which kind of incentive program will work best for you, it's best to audit your supply chain flow and budget to analyze what your brand can reasonably offer. Exclusivity will always be a primary tactic to motivate your shoppers and foster a sense of loyalty.
Empower loyal customers with autonomy
Today's modern shopper demands more from their brands, including control of their shopping experience, access to critical information and a hyper-personalized, convenient hub. A 2018 study by Statista found that 88% of U.S. customers prefer a self-service portal for a better customer experience. An effective customer portal should quickly empower customers to:
- Order, edit or track upcoming orders
- View order history
- Add-on items with ease
- Redeem rewards
- Access limited-time offers, new product drops, birthday gifts, and more
- Update preferred payment methods
- Access detailed FAQ information
- Contact customer support in real-time
In addition to the bare minimums, a highly effective customer portal will empower brands with next-generation features such as reward opportunities, easy referrals, reviews, loyalty programs and more. Going above and beyond, an effective customer portal will be the backbone of your retention strategy, serving as the ultimate brand engagement hub for your one-time and recurring customers.
The bottom line is that DTC brands must avoid the costly mistake of focusing most of their attention on the uphill battle of acquiring new customers. Instead, they should focus on nurturing the relationship with existing customers to cultivate a feeling of brand love. In shifting your focus to your post-sale strategy, you will ultimately shape returning customers into brand advocates who organically spread the word, gift your products to their friends and family and grow your brand into a movement.
Related: 5 Ways to Navigate the Retail Ins and Outs for DTC Startups
