4 Ways to Improve Customer Retention for E-Commerce Businesses



Indonesia’s e-commerce competition is a very tight race. It is no easy endeavor to acquire customers. As such, once they are acquired, customer retention needs to be maintained as best as possible. E-commerce business owners will do well not to underestimate and undervalue the customers they already have. These customers’ retention is vital for the business’s sustenance and continuance.

Study results by Marketing Metrics can be a source of referral. They find that the probability of successful sales to old customers is at 60% to 70%. In contrast, the sales success rate towards new customers dropped drastically to only 5% to 20%.

Therefore, e-commerce business owners must maintain and improve customer retention. Achieving this will lead to a boost in sales. There are various routes for e-commerce customer retention strategies for business, below are some of them.

1. Establishing scheduled communication with customers

It is necessary for e-commerce businesses to establish communication with customers. The best practice is to proceed in a systematic way in order to ensure the continuity of the relations. Therefore, establishing scheduled communications is highly important.

Customers can be contacted directly once a purchase is made, which means they have experienced the product or service’s quality for themselves. They can give feedback, or even complaints if the product or service is deemed unsatisfactory. If negative sentiments are received, the e-commerce business has to respond as best as possible so that word of the dissatisfaction will not widely spread.

Afterward, continuous contact with customers must be made. There are various ways to achieve this, such as sending messages, surprises, or simply doing email marketing. A business can decide on whichever method is most fitting with their budget.

Being always connected with a business can make customers feel like they are receiving personal attention and services. This can impact the business greatly. Accenture states that 33% of customers decide to lapse from a business because they feel that the business lacks in giving them focused and attentive customer service.

2.  Analyzing with the correct measurements

Customer retention can be an accurate indicator of strong business performance. High customer retention almost certainly translates into the sustainability of a business. As such, businesses need to have an understanding of the various measurements that can be indicators of customer retention levels. E-commerce businesses are no exceptions to this rule.

Below are some notable customer retention metrics that are important to highlight.

  • Repurchase Level: This metric indicates the percentage of repurchases made by customers.
  • Customer Lifetime Value: A metric showing the amount of revenue that a business can expect from a single loyal customer.
  • Revisit Level: This metric measures the number of visitors, both purchasing customers, and non-customers, that revisit an e-commerce website. Learning this will give a picture of customer engagement with the brand

3. Making customers as the business focus

E-commerce brands must have the capability to focus all business facets for the sake of customers. All endeavors must be undertaken with the goal of customer satisfaction. This is one of the main recipes for customer retention improvement.

There are many ways to do this. An example is to ensure ease and accessibility for customers who need to contact the business. List or link the business’s phone number, social media account, email, or address that can be easily contacted by customers for any of their needs and queries. Then prepare customer service training to face customers in the finest possible manner. Train the staff to serve consumers; and to be ready in responding to various complaints. 

If done well, a business will reap great benefits. A study by Aberdeen finds that when a business is able to consistently provide satisfactory service to customers, it will have a chance of retaining customers by up to 89%. However, if the opposite is true, customer retention will drop to 33%.

4. Sharing the company’s value

Nowadays, customers do not only judge a business by the quality of its products or services. More than that, they want to know the values that a business endorses and the goals it wants to achieve. If deemed appropriate to them, then customers will make the decision to purchase.

Therefore, an e-commerce business needs to share its values and goals with the public audience. Show internal company activities and communicate the various efforts in striving to achieve those goals. Take an example of an e-commerce company that endorses and supports a high-quality yet environmentally friendly fashion industry. They can show the production process of their clothing which makes use of recycled or sustainable materials.

This must be communicated to the audience consistently. Hence, the public will have an awareness and thorough understanding of the company’s values. This can eventually interest them to be part of the movement by buying the product.

Maintaining and improving customer retention is a continuous undertaking. All businesses, e-commerce included, must consistently take on this endeavor so as not to lose customers.

Also read: The Complete Guide to Conduct Retail Audit Optimally



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