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A study from Harvard Business Review stated that acquiring a new customer can be 5 to 25 times more costly than simply retaining a current one. This is especially true for e-commerce companies, where digital ad spend is at its record high and is expected to increase further in 2022.
Managing and maintaining strong customer relationships well can help businesses grow and should be one of the key strategies in every business. One such way to measure customer relationships is to use a Customer Relationship Management (CRM) tool.
For e-commerce, CRM focuses primarily on sales and online customer activities. These tools can assist companies in analysing their website’s metrics, such as conversion rates, click-through rates, email subscriptions, and popular products among customers.
In understanding customers’ online behaviours, e-commerce businesses can boost customer loyalty, drive sales, and leverage customer information. Read on to learn about different e-commerce customer retention strategies and CRM tools.
Australia's e-commerce market has been expanding rapidly for the past few years. In fact, Australia is the 11th largest e-commerce market in the world with its revenue expected to reach US$32.3 billion by 2023, according to the International Trade Administration. A number of factors have contributed to this strong growth, including an increase in internet penetration as reported by GlobalData and the growing popularity of mobile commerce.
In addition, Australia has a large number of small businesses that have been quick to embrace e-commerce as a way to reach a wider customer base. According to DHL Express’ Export Barometer report, 86% of small businesses were likely to depend on e-commerce. In 2021, 40% of successful Australian firms were looking to invest in online marketing, and 34% wanted to improve their website design.
Before diving deeper into the different ways to improve customer loyalty, it will be helpful to understand what customer retention in e-commerce is. Customer retention is an action a business uses to increase the number of repeat customers and the purchase per customer. A study from Hubspot indicates that 5% increase in customer retention can boost your profit by 25%.
E-commerce retention strategies typically involve providing more value to the existing customers and keeping them satisfied. A satisfied customer has a higher chance of returning to make another purchase. Here are some ways to do so.
The e-commerce reward points system is an old strategy that still proves successful today. It incentivises customers when they return to purchase in the form of virtual points. These points are exchangeable for discounts, cash back, and exclusive deals.
Investing in great customer service can help to boost your revenue. Customer service insights have proven that excellent customer service can increase sales, customer retention, and satisfaction. Happy customers are also more than willing to spread positive word-of-mouth to their families and peers, thus further increasing your profit. Even though e-commerce businesses do not usually interact with customers in person, there will be times when customers contact the customer service hotline for support.
Surveying your customers allows you to gain insights on how well your service is performing or what they think about your product. Such feedback helps you to figure out the areas you can further improve on. For example, adding a small survey form at the end of the checkout lets you in on the customer shopping experience. You can then enhance your customers’ experience by making relevant changes.
Another vital tip to include in your e-commerce retention strategy is to provide on-time delivery. With many competitors in the e-commerce sector, customers care about more than just your products and services. According to Digital Commerce 360, 61% of shoppers expect their orders to be delivered within three hours of purchase, and 80% want same-day delivery. Furthermore, 17% of shoppers also stated that they will abandon the cart if shipping were delayed. In short, your customers can get annoyed if their orders are late or they experience slow deliveries.
Partnering with a reliable delivery network can improve customer loyalty in e-commerce. By engaging a reliable delivery service like the one provided by DHL Express, you ensure that your orders are picked up and delivered on time to your customers.
Different types of CRM tools provide companies with a variety of data. How each tool is used depends on the industry and company size.
With each new Apple device, users are prompted to create an Apple ID. This ID is used across all Apple devices by the same owner and allows access to exclusive apps such as Apple Music, App Store, and iCloud. The ID also saves all of the user’s music and film preferences and provides personalised recommendations accordingly.
Through a personalised approach, customers have a higher chance of developing a sense of loyalty and familiarity with the brand. For Apple, this CRM system helps them constantly adjust their services to suit their customers with dedicated content.
SP Screens is an SME which provides Australian homes with secure and stylish screening solutions to keep unwanted pests away. Having struggled to gain a firm foothold in the industry, a study by Salesforce, the company now uses its CRM to track its progress. Metrics such as email open rates, click-through rates, and purchases all helped SP Screens evaluate its performance and adjust its sales and marketing accordingly. This turned out to be a huge success, with the company seeing its customer base triple and a 25% jump in customer satisfaction.
Due to its huge customer base, Salesforce reported that Volkswagen Group Australia faced the issue of slow response time to their customers. A few weeks were needed for an answer whenever a customer called or emailed for an enquiry. Using a cloud-based CRM tool, all questions are funnelled through one source. This method allowed multiple departments to share customer details, reducing the time needed to gather information. As a result, the automobile company saw a 100% improvement in productivity, and 85% of cases were solved within 24 hours.
DHL Express is the leader in international express delivery. We have partnered with many successful Australian e-commerce businesses to provide fast, efficient, and cost-effective deliveries to their customers. Open an account with us today to discover personalised solutions to enhance the e-commerce retention strategy for your business.