In the e-commerce industry or any business for that matter, it is important to gain as many new customers as possible. This is usually the belief of entrepreneurs, especially those that are new to the industry.
Although it is always encouraged to build your customer base, retaining your existing ones is so much better than acquiring new customers.
There are many reasons why this is the case. First, attracting new customers, believe it or not, is actually more expensive than keeping your existing customers happy and encouraging them to be your repeat customers.
Second, customer retention strategies have been proven to work and although you can employ SEO strategies to help drive more traffic, that doesn’t necessarily mean that your conversion rate is going to be high.
Third, your existing customers actually bring you the bulk of your company’s profits. In fact, according to a survey, your existing customers may provide you with 25% increased profits than those who are still new.
According to Yoav Vilner, an external CMO, his marketing agency actually learned that nurturing their existing customers yielded better profits than focusing their efforts on attracting new prospects.
This is not to say that you shouldn’t spend money on getting new customers as every business model would always tell you to do that on a consistent basis. But, what I am trying to say is that focusing more on your existing customers (assuming that you have built a sizable base) is so much better from a profit standpoint.
How is This Done?
So, how do you actually nurture your existing customers? Well, here are some ways:
1. Identify Your VIPs
The first thing that you need to do is to know which of your existing customers you can consider as your VIPs. Usually, entrepreneurs deem their customers as VIPs if they have purchased a lot of your stuff over a certain period of time.
You can find out who your repeat customers are by using your website’s analytics and seeing certain metrics like customer frequency, average value order, among others.
2. Determine What Your Customers Want
Determine what your loyal customers actually want in your business. Perhaps, they like how fast your shipping is. Or maybe, you provide excellent customer service, especially in the way that you handle customer complaints. Whatever the case may be, determine what your customers actually want in your business and improve on that.
3. Give Your VIPs Some Perks
According to statistics, 65% of an online business’ profits actually come from their existing customers. Because you want to encourage your VIPs to come back for more, give them perks and incentivize their every visit.
A customer loyal program is one of the best examples of this. Suppose that they’ve purchased a couple of items and have reached a certain threshold, maybe you can give them additional perks such as discounts or free shipping, to name a few.
4. Stay in Touch
Although some online businesses have employed AI chatbots to cater to their customers’ needs, nothing beats personal connection.
Staying in touch with your VIPs and existing customers is one of the best ways to further your connection with them. If you are connected to your customers, there is no doubt that they will connect with you as well.