As an ecommerce store owner, you might be thinking about ways to increase profits and retain your loyal shoppers. This is a question that most store owners come across daily, no matter if they are just starting or have an established enterprise.
There are two ways of increasing profits in the company. First, acquiring new customers, and second, retaining your old customers and turning them into loyal ones. Acquiring new customers is 25 times more expensive than retaining old ones. This is why more companies are choosing to work on retention strategies to maximize their profits.
Do you want to increase your profits without attracting new customers? Then focus on these 6 creative strategies to maximize your customer lifetime value. Let’s dive in!
Launch Recurring Subscriptions
Introducing subscriptions is a great way to retain your customers and generate passive income. Different types of subscriptions have various impacts on customer loyalty, hence increasing your customer lifetime value. Subscriptions have become extremely popular in the last few years. Traditional newspapers, magazines, and television subscriptions have moved digitally to suit their user's experience. Also, e-commerce subscription services have grown by more than double in the past five years. So, if you are looking for a way to generate stable revenue and have your customers stick around for longer – introduce a subscription model into your ecommerce store.
So how do you start with subscriptions? There are plenty of apps on the ecommerce store that offer subscriptions for any budget packed with various features.
There are different ways how you can get your customers to subscribe. You can offer generous discounts if your customers subscribe to a more extended plan. Alternatively, you could create a flexible subscription plan or auto-ship model for the customers that often run out of your products. By offering a product for a lower price on auto-ship, your customers will be more likely to subscribe.
To get a loyal customer, you have to give them a reason to come back to your business. You could do so by introducing a loyalty program to your audience. According to research, companies with loyalty programs grow 2.5 times faster than their competitors. Moreover, millennials and Gen Z’s have an e-commerce-first mindset and these customers spend most of their dollars shopping online. It is essential to build loyalty programs catered to millennials and Gen Z’s because 63% of them say that they will not commit to a brand that does not offer loyalty and rewards.
Setting up a loyalty program for an ecommerce store is quite simple, and there are plenty of apps to choose from. Most loyalty programs on platforms like Shopify already have an automated integration to your store with a few clicks. There are various types of loyalty programs that you can choose for your business, such as punch cards, points, or VIP tiers. However, the most important is to make it super easy for your customers to sign up for the loyalty program. Otherwise, you could end up ruining the customer experience instead of making it better.
Upsell And Cross-Sell
Upsells and cross-sell are leading tactics in making your customers spend more and generate more profits. It is equivalent to “Do you want to get fries?” for cross-sell and “Do you want to upsize?” for upselling. These methods are incredibly persuasive, especially in encouraging your customers to impulse buy. Upsells are 68% more cost-effective than acquiring new clients. The main point is providing value to your customer with upselling and cross-selling, such as wine with cheese, a phone with a phone case, shoes with socks, and others. You will end up with good profits by offering a great deal and giving extra loyalty points for purchasing bundles.
An example of a successful company in upselling and cross-selling is Amazon. It offers a frequently bought-together tab before a customer makes a purchase that influences them to add extra products to their cart. However, there are apps on Shopify with precisely similar features that can help you sell more and drive profits.
Introduce VIP Tiers
Everyone loves to feel special and a part of an elite club. VIP-tiered programs offer gamification to your customers and a sense of exclusivity, resulting in more profits and increased retention rates. This is the reason tiered loyalty programs are quite successful in e-commerce marketing. Moreover, over 70% of shoppers say they would stick to a brand that offers a good loyalty and rewards program.
Popular brands such as Sephora, Uber, and Starbucks offer tiered loyalty programs. But how do you get one for an e-commerce store? The answer is simple, most loyalty apps on Shopify include VIP tiers, which are relatively easy to set up. You can choose any number of tiers and give them unique names. Also, you can decide how your customers can go up the tier ladder, such as purchase amount, loyalty points, and number of purchases.
You can offer an exclusive one-time discount to make your loyal customers feel a little more special. Everyone likes a good deal, but a great and personalized deal is even better. Providing deals and discounts to your blog subscribers or social media followers can make them feel special. Exclusive deals can act as inducers to persuade shoppers to buy from you again and again. Coupons, freebies, gifts with purchase, and gift cards are all great options. Set a limited time and date for validity to make your shoppers redeem these offers.
Building a sense of urgency can motivate your shoppers to impulse buy. Exclusive deals that last under 24 hours can be real winners if you send out promotional campaigns to your customers via web push notifications, emails, or social media. It is guaranteed that at least a fraction of your customer base will make a purchase.
Set up web push notifications to help you with grabbing your customers’ attention and encourage them to purchase from your store. For instance, once your customer is about to leave the website, a pop-up with a discount shows up. You can also incorporate loyalty programs with push notifications. For example, sending nudges to your customers when their points are about to expire or reminding them about unused discounts.
If you are not doing email marketing, then you are not improving your ROI. A great email marketing strategy will help you make more money. You should expect an average return of $42 for every $1 you spend on marketing emails. Moreover, you can build relationships with your customer base via email marketing, for instance, by segmenting your audience and sending them the right emails depending on their buyer journey. Also, personalization works well in making your customers feel special while also automating the process. Before sending out an email campaign, first, think about the goals and objectives of these campaigns. Will your customers benefit from this email? Content strategy is another piece of the puzzle in email marketing. Write emails as if you are writing to a friend with simple text, graphics, CTA, and catchy subject lines.
Wrapping It All Up
- Kudos to you if you’ve read this far! Let’s wrap up a few key takeaways:
- Encourage your repeat shoppers to sign up for a subscription.
- Launch a gamified loyalty program to engage your most loyal customers.
- Use upselling and cross-selling to sell more and drive profits.
- Introduce VIP tiers to make your customers feel more special.
- Use urgency to increase sales and retention.
- Start email marketing campaigns to improve your ROI and build relationships.
Hopefully, you found this article interesting and came across new ideas to implement in your store. Comment below which ones you found the most useful!
About The Author:
Polina Kulikova is a digital marketeer at Growave, and she is passionate about creating content for e-commerce businesses to help them succeed. Growave is the all-in-one marketing platform for small and medium-sized Shopify stores. Growave helps to drive conversions, boost sales, and build brand loyalty. Some of Growave's features are Reviews, Loyalty and Rewards, Wishlist, Social Login, Instagram, and UGC.