A lot of eCommerce Marketing experts talk about the importance of current customers when you want to increase profits.
A study by the Harvard Business Review found that getting a new customer is about five to 25 times more expensive, than retaining the ones you already have. Another study reports that a 5% increase in customer retention can lead to a 25% boost in sales.
Why should customer retention be an important part of your ecommerce store? Why should you continue marketing to your current customers?
In this blog we will talk about the advantages of retention marketing:
Current Customers Spend More!
People buying online tend to stick to the same stores, stores they have had a good experience with in the past.
Let’s say, you bought some makeup products online and you had fast delivery, the products we priced well and looked great on your skin. Now you have tried and tested the product and company, you’ll likely buy it again, instead of taking the risk buying from another website.
This is why retention marketing works so well!
Existing customers are about 60 to 70 percent more likely to purchase again, compared to new customers.
Current Customers Will Become Brand Ambassadors
Current customers are your brand ambassadors.
As they’ve bought from your eCommerce store in the past and even used your products, they’ll likely share their experiences be them positive or negative with their friends, family and even their social media following. They’re more likely to review your product, post it on social media and their review will influence people to try it out for themselves and try your brand.
A study found that customers referred by other customers had a 37% higher customer retention rate. In addition to this, customers acquired via these types of referrals spend 200% more than a customer that finds you through other forms of advertising!
Would you be more likely to buy from a store after you saw a sponsored ad Facebook, or if someone you knew and trust posted about their positive experience?
Current Customers Keep You Profitable
All business owners want a regular customer base.
In an ideal world you want to get to the point where you can predict what will happen each month, you know that you’ll remain profitable because X amount of people consistently return to your online store and buy from you. So, successful eCommerce stores have a lot of regular, loyal customers.
When you have a regular customer base you’re not desperately trying to get sales and pay the bills. You don’t have to keep prices down because you know that you’ll reach your targets and maintain profitability.
This is why retention marketing is so crucial to your business and something you want to focus on.
With a successful retention marketing strategy in place, you won’t be panicking because your competition has decreased their prices. You can relax at night because you can confidently maintain your profits.
Ready To Get Started?
Customer retention is very important to the success of your eCommerce store.
Current customers are more likely to buy your products, compared to new customers. It’s vital that you provide positive experiences, so they’ll also recommend your products to friends and family. Since their network trust them, they’ll also buy your products and drive future sales to your business.
This helps you maintain your profitability in the long-run. You can relax and focus on growing your business in other areas, because you’re confident in your online sales.
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