Top 5 Customer Retention Strategies For eCommerce

/ June 19, 2020 | 4 Mins Read

Top 5 Customer Retention Strategies For eCommerce

Customer retention is the collection of activities lots of businesses work on to increase the number of repeat customers and to get profited by them. Look at some of the ways online retailers can improve customer retention.

In the last 5 years, the cost of customer acquisition has more than doubled, according to research done by Hubspot. With acquisition costs skyrocketing, a common mistake made by marketers is to overlook customer retention, which is a key aspect in assessing the lifetime value of a customer. 

Customer retention is comparatively much cheaper than acquiring a new customer. Overall, customer acquisition is a long, costly, and resource-intensive process and it just makes a lot more sense to retain customers than to acquire them. 

Over time, a lot of marketers have recognized this trend and have started focusing more on improving the experience that a customer is having while using the service than going all out on the marketing budget to acquire a customer. Out on the internet, there are a lot of guides about customer acquisition and rightly so. 

This makes a lot of sense for eCommerce businesses where the customer is almost spoilt for choice. There are anywhere between 12 - 24 million eCommerce stores online. This poses a great challenge for every company in this domain. This challenge is in the form of a question, how do I make sure that my customers come back? This question has one easy answer. 

And that is focusing on Customer Retention. 

Time and again, different customer retention strategies have been tried and tested with just one goal in mind, and that goal is to improve the customer experience.

In the context of eCommerce, there are certain strategies that work best. We have compiled a list of strategies that have shown the best results and you can implement these to see the retention going up and the churn coming down in your eCommerce business:

1.   Providing Convenience

You can offer convenience in many ways. If you want your customers to have the same convenience that they have on your website but on the go, you can opt to invest in a mobile app. This allows your customers to engage with your eCommerce business minus all the hassles of a desktop.

Another option is to, well, provide more options. There are several ways in which this can be done. Providing convenience in the form of multiple payment options, delivery options, free shipping can be the way to go. If we have an exit form that can allow customers to tell the company for their reason to leave, it will go a long way in customizing the options that provide convenience. 

One of the more upcoming trends in eCommerce has been the use of chatbots. Incorporating chatbots and live chat into your eCommerce platform makes it easier for customers to get in touch with you. This makes it easier for you to help your customers and prevent any easily avoidable churn. 

The objective here is just to make life easier for your customer.

2.   Philanthropy

Letting customers feel like they are making a difference in the world can be game changing. Telling your customers that they will be making a worthwhile donation if they purchase something or if they reach some purchase targets is a great way to retain customers. Customers start to feel a sense of belonging. 

The idea behind all this is to not make customers want to stop. This could be something that your business could be doing differently than others. Having a sense of pride in being associated with some charitable cause can make it less likely for people to leave your platform or switch to another one.

3.   Loyalty Programs

Loyalty programs are probably one of the most effective ways to retain customers. They make customers feel special and provide them with the social currency that makes them feel like they belong to an exclusive group of customers, which they do. 

An ideal way of implementing this is to introduce special membership for customers that have achieved a certain level of purchases. Providing them with perks like special discounts, better delivery options, that come with this special membership give out a sense of exclusivity. 

The end goal here is to provide customers with such special service that they do not want to leave your service or at least think twice before switching to another provider.

4.   Using Loyal Customers As Social Proof

Word of mouth has proven to be the best form of marketing ever. It instills trust immediately in the mind of the customer. People are 4 times more likely to make a purchase if they’re referred by a friend. Around 80% of customers prefer the advice of a friend or a relative over any other marketing activity. 

With social media providing a level playing field, it’s the best place to showcase your happiest customers. You can ask your loyal customers to post reviews about their purchases on social media, you can tap into influencer marketing or simply create a video to share your customers’ feedback on individual products.

5.   Focusing on Customer Service

No matter how well you have designed your service, your customers are going to face some or the other issue, and how your customer service handles this issue is a make or break situation. This experience needs to be seamless because the customer might already be under a lot of stress and bad service experience will just worsen the situation. 

Some strategies to improve customer service are using omnichannel communication, taking periodic customer feedback, focusing on educating customers about your service. The goal of all of this is to produce happy customers. Happy customers are easier to retain and can act as some of the best marketers for your eCommerce business. 

In conclusion, customer retention, if done right, provides great returns. It is much cheaper to implement and its results are much more evident to measure.

Implementing customer retention techniques gives you a much deeper understanding of your customers and knowing the reasons as to why they want to leave. Through this knowledge, you can improve customer experience and drive a higher retention rate, ultimately increasing the lifetime value of a customer.


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