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January is the perfect time to define how you’ll measure overall ecommerce success. For 2023, it should be the customer retention rate.
By focusing on the CRR, you can scratch off menial timewasters and tackle the problem at its core.
Retention Is Key
Increasing the number of repeat customers is the best way to boost profit and catapult brand awareness.
According to Omniconvert, a conversion platform, the average CRR for ecommerce is about 30%. To calculate yours for 2022, take the number of customers who consummated a transaction during the year (T) and subtract first-time buyers (F). Then divide that number by the total number of historical customers at the beginning of the year (B).
T — Total buyers in 2022
F — First-time buyers
B — Total customers at the beginning of 2022
[(T-F) / B] x 100
Say 5,000 customers consummated a transaction in 2022, and 2,000 were new. You started 2022 with 9,000 total historical customers.
[(5,000 – 2,000) / 9,000] x 100 = 33.3%
In this example, the baseline is 33.3% — the number to beat in 2023.
Increase the CRR
Depending on the study, repeat customers spend upwards of 67% more per purchase and can account for 50% or more of total sales. Thus ensure your sales goals focus on CRR. This may require adjusting advertising budgets and flash sales to programs that engage with and reward loyal customers.
Consider these options:
Targeted email and SMS marketing. Special VIP communications can make a difference, especially with personalized content based on a customer’s interests and order frequency.
Early access to new products and services. Reserved inventories and first come, first serve offers can create fear of missing out.
Exclusive access to select items. Unique accessories or limited editions of popular products can be enough to entice customers to return.
Legacy pricing to long-time customers.
Priority support and dedicated contact info eliminate frustration by giving your best customers a way to skip…..
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