If you’re like many business owners or marketers, you want to keep first-time shoppers around so you can turn them into brand advocates and loyal repeat customers. The process we just described is called customer retention, and it’s more important for your success than you might think.
For starters, it costs more to acquire new customers than it does to retain existing users. It’s also worth mentioning that repeat customers tend to spend more than first-time shoppers. In other words, if you don’t have a solid customer retention strategy, you’re likely leaving money on the table and missing out on key engagement opportunities.
The good news is there are plenty of ways you can gradually improve your retention rate. Today, I will go over several powerful tips and tricks that will help you keep people coming back to your site long after their first purchase.
Are you ready? Let’s dive in!
Discover Your Customer Churn Rate
The first thing you should do is figure out your customer churn rate. Simply put, your churn rate is the number of people who buy something from your website but don’t come back after a predetermined time.
For instance, a pet store might consider shoppers who don’t make a second order after three months as a churn. Meanwhile, SaaS providers often look at annual renewals to determine their churn rate.
Regardless of the type of business you operate, you can use a relatively simple formula to determine your churn rate. Here is the commonly used equation:
number of canceled customers / total number of customers x 100 = churn rate
So, if you have 500 customers but 50 canceled or didn’t make a repeat purchase after a specified time, the formula would read:
50 / 500 x 100 = 10%
Using this math, you can see that the churn rate in this example is 10%.
There is no official number that defines a good or bad churn rate. It depends on your industry, resources, products, and more. But once you understand how many people are leaving, you can act accordingly and accurately measure changes in your retention rate over time.
Develop a Robust Content Marketing Strategy
Now that you know your churn rate let’s talk about how you can boost your retention rate through your content. Blog content, videos, and other forms of visual media can keep users engaged with your brand, which means they are more likely to make a repeat purchase.
Creating various types of content on your site will do a lot more for your retention rate than ads. This is due to the fact that 70% of consumers prefer getting to know businesses through their content instead of paid advertisements.
You’ll want to create plenty of blog posts that resonate with your audience’s needs and pain points. The more you know about the people visiting your site, the more opportunities you’ll have to create relatable and valuable content.
Not only can this strategy help with your retention rate, but it can also help drive new organic traffic to your online store. Research shows that companies that publish 16 or more blog posts a month see 3.5x more traffic when compared to businesses that only publish 0-4 posts each month.
I also wanted to mention the importance of including engaging content in places other than your blog. For instance, adding videos to your product landing pages can help you generate a whopping 80% more conversions.
Reward Customer Loyalty
Most of us have shopped with a business that rewarded us for our loyalty. It feels good to get a little something extra from a company that we genuinely enjoy. Your customers likely feel the same exact way about your company.
If you want to retain your best customers, you have to come up with some clever ways to reward shoppers for coming back to your site. You can make this happen by establishing a reward point system for your shoppers.
Essentially, this means that visitors will receive a reward every time they shop with your business. In most instances, companies choose to give shoppers points that they can cash in for credit on their next order. This strategy can help you secure more repeat customers and extra revenue because shoppers usually spend more than their points on a second order.
You can also reward people who choose to engage with your brand. I firmly believe that online contests are an excellent way to bring people back to your site for a repeat purchase. The key is to reward everyone who participates in your giveaway, not just the winner.
So, after you announce the winner, send everyone who participated a discount for their loyalty. You’ll find that even a 10% discount can go a long way towards turning more first-time shoppers into repeat customers.
Make Social Media Engagement a Priority
Speaking of online contests, let’s talk for a bit about social media platforms like Facebook, Twitter, and Instagram and how it relates to customer retention. Did you know what 59% of people turn to social media when they need shopping inspiration? Regardless of your industry, this is a big deal because over 3.96 billion people use these sites every year.
There are quite a few advantages to making social media engagement a priority for your business. The most notable benefit is enhanced brand awareness. If someone bought something from your site, then decided to leave without subscribing to your emails, they may forget about your company.
When it’s time to calculate your churn rate, everyone who follows this path will likely contribute to your overall churn. Instead of letting these people walk away, you have to remind them that you exist through social media.
I suggest sharing some of the best content on your site to your social media channel. Not only will this drive new visitors to your site, but it will also remind existing customers that you’re still there and waiting for their business.
You should also spend plenty of time engaging with your audience in the comments section of your posts. People are more likely to come back to your site if they know that you’re around to answer questions and provide additional information if needed.
Create a Feedback Loop
The last topic I want to discuss today is feedback loops. Simply put, feedback loops are one way business leaders, and marketers can listen to their customers. You’ll want to establish several ways for customers to share their thoughts with your team.
One effective way to encourage users to share their thoughts is by including a feedback form on your site. I suggest limiting your questions to 1-5 key things you want to know from existing customers. You can learn a lot about your existing customers and gauge the general sentiment of your community.
I also recommend reaching out to customers through email soon after placing their orders. You should try to ask questions that will help you improve your product, website, and customer experience in the future.
If you follow my advice from the last tip, you’ll also get a ton of feedback from social media. People are more than happy to answer questions when businesses reach out. Don’t be afraid to work with your customers to improve your brand. Establishing several feedback loops will help you continuously improve your product and services over time, which can help you retain your best customers.