To strengthen the relationship with customers and make them stay longer on your site, business owners should pay attention to customer retention and improve the rate as much as possible. Let’s dive into these exclusive strategies to know the best ways to retain customers and make your Magento store stand out from the rest.
Why Do Magento Merchants Need To Retain Customers?
Customer retention refers to a process where companies and brands keep their customers engaged frequently and make them continue buying products or services.
There are a few reasons why this factor is critical.
1. It boosts ROI and conversion rates
According to Hubspot, company revenue can increase from 25% to 95% with just a 5% increase in customer retention.
Having attractive customer retention programs also helps encourage customers to interact with your website, thus improving conversion rates remarkably. It creates a motivation for them to keep coming back again and gain.
2. It attracts new customers through word-of-mouth advertising
Being one of the top cost-effective marketing strategies, word-of-mouth seems to be traditional, but it brings about many benefits for businesses. Retaining customers equals delivering excellent experiences to users.
When having a good impression of your shop, customers are more likely to share their positive feedback and introduce your store to others. This tactic will even improve your store’s popularity, and it is free!
3. It reduces marketing costs
You don’t need to invest a fortune in marketing campaigns for loyal customers because they are already familiar with your products and services.
Therefore, you can save a lot of money, and all the budget can be used for other purposes like attracting new customers. It’s not an exaggeration at all that retaining customers is key to your Magento e-business.
Practical Strategies To Retain Customers In Magento E-Commerce Stores
1. Utilize email marketing automation
Email marketing is no stranger to e-commerce businesses. It can help merchants save a great deal of money and effort when becoming automatic. Thousands or even millions of promotional emails are to be sent directly to prospects and subscribers in a blink of an eye.
This simple strategy plays an essential part in retaining customers. It helps create a buying cycle by sending emails on schedule to remind the customers.
For instance, sunscreen is a must-have product, and many people run out of their sunscreen in 1 month. You can set up an email to be sent automatically to them with offers to purchase new sunscreen after 1 month.
By doing so, not only does it provide a personalized experience for your customers, but it will lead to increased revenue.
2. Optimize personalized experience
Personalization is getting more recognition from marketers as it helps brands communicate with their customers in highly targeted approaches. It aims at delivering custom messages to every individual prospect and customer, which considerably improves the user experience.
Customers usually give personal information to their favorite brands and expect to get something unique in return. With provided data collection, merchants need to analyze it by applying calculation tools carefully. Having all the data processed, it’s high time to act and deliver your marketing decisions.
Personalized marketing tools are key to providing excellent content to your audience, so make sure to take advantage of them. CRM software, data analytics platforms such as Google Analytics, data management platforms, etc., are among the most powerful tools for businesses.
3. Create a rewards program
In simple words, it rewards customers who frequently interact and purchase from the brand. The rewards range from coupons vouchers to cashback, physical gifts, etc.
This marketing strategy serves as an incentive for your existing customers, encouraging them to continue buying from you. The more products or services they purchase, the more benefits they enjoy. These customers will also be more likely to interact and make a transaction than new customers.
Moreover, a customer loyalty program can help business owners reduce marketing costs by increasing retention rates and spreading word-of-mouth advertisements.
Some recommended tactics to increase customer loyalty include premium service available 24/7, personal invitation to special events, exclusive access to limited products, etc.
4. Reduce page load speed
Page load time refers to the time your Magento website takes to represent the content to the users fully. When your e-commerce store loads fast, users tend to stay longer, thus boosting conversion rate and user engagement significantly.
This factor is one of the key marketing strategies to your website’s success for several reasons. First, creates a good impression on first-time visitors and encourages existing customers to come back frequently.
Second, Google also gives more points to fast-loading sites when ranking them on their search page results. So a fast website means higher visibility to potential customers.
A simple way to improve your site’s speed is to optimize images & videos. By compressing its size, your page can load much faster. Furthermore, you can consider upgrading your Magento website to a Magento Progressive Web App. With the PWA integration, your website page load speed will be faster than ever.
5. Apply push notifications
Like email marketing, push notifications are messages automatically sent to your customers or subscribers. These notifications pop up on the user’s devices such as mobile phones, tablets, or laptops, instead of landing in the mailbox.
As a path of communication, this simple marketing tactic effectively increases user retention rate and keeps them engaged.
For example, when they reach a new level of customer loyalty, you can send them a notification with coupons or update them on points used. Otherwise, use push notifications to tell customers about new arrivals.
6. Provide 24/7 available chatbot
By definition, a chatbot is a computer program that creates automatic conversations with website users. It can instantly provide various responses to customers’ questions related to your business or products.
But how can this AI innovation help increase customer retention rate? Chatbots collect data for later analytics while communicating with the users. The data is then used to craft buyer persona and analyze their shopping behaviors, providing insight for business owners. This can help them create more personalized tactics to approach their customers.
Leveraging your chatbots with multi-languages, 24/7 availability despite time zone can strengthen customer loyalty and drive retention by at least 5 times. Don’t forget to ask your customers for feedback to deliver better services.
7. Take advantage of gamification
In recent years, gamification marketing has gained massive recognition as an incredibly creative way to attract new customers and keep existing ones engaged. Players can gain rewards like vouchers, coupons, or small gifts, which are incentives to retain customers.
For new customers/ players, merchants can create gamification to offer them first-time buyer rewards to encourage them to come back next time.
Besides, games are considered an effective tool to promote new products or services. A fun and informative game with rewards will educate players and improve user engagement and increase the chances of their coming back.
8. Be consistently active on social media
Boosting your business’ social media presence makes customers feel connected and valued. Many companies such as Instagram or Twitter even interact with their customers via witty comments or retweets.
Yet, social media is an effective channel to retain your customers only when you frequently interact with your followers. It is crucial to deliver genuine messages and interactions uniquely that show off your brand personality.
Your content should also be attractive enough to appeal to your targeted audience, making them feel interested and visit your Magento store more often.
Frequently Asked Questions
1. What are the significant barriers to customer retention?
- Ignoring customer feedback
Feedback helps merchants understand what they are doing well and what they need to improve. If you turn a deaf ear to customers’ problems, they will likely walk away.
Therefore, when customers give you feedback, even if it’s negative, you should always appreciate it and implement changes accordingly.
- Increasing competition
Competition is always intense among e-commerce businesses. If your online store doesn’t offer customers great services or doesn’t stand out from the rest, you’ll fail to retain them. To thrive, merchants should find their unique selling points and grasp a solid insight into their target audience.
2. What kind of customer data do merchants needs?
The first data that a merchant should care about is the customer behavior on their site. This can point out why customers complete their purchases, and why not.
Second is customer feedback regarding their experience with your brand throughout the entire buying process. From the time they interact with your site, to post-purchase service, all of these will offer great insight into customer behavior. You can from there decide what else can be provided to better retain customers.
3. How much should merchants spend to improve customer retention rate?
There are several ways to allocate your financial resources for retaining customers. One approach is to apply the 75% strategy. According to YFS Magazine, merchants should spend 75% of the overall marketing budget on customer retention. Explaining this heavy focus, experts say that it’s better to prioritize a specific group of customers than waste the whole budget targeting the wrong audience.
Another solution is to follow the formula and calculate based on businesses’ revenue each year. There is no fixed amount of money or a standard budgetary percentage, so merchants can be flexible and find the way that suits them the best.
There is a wide range of possible methods for your Magento store to retain customers and reach targeted goals. Hesitate not and start making your customers engaged right today! Follow the customer retention strategies we covered in this article. You will be surprised to see when the results come out 3 months later.