2019 Update: We released a detailed eCommerce Marketing Automation guide. You can read it here.
In recent articles, we have established why marketing campaign automation is an important part of eCommerce for nurturing leads and increasing conversions. Our post today will explore the final part of the customer journey – engaging your customers after first purchase. We will address how marketing automation can play a key role in extending your customer’s lifetime value (CLV).
What is a customer worth?
For any eCommerce to be truly successful, it’s key to really understand the unit economics related to your customer acquisition, retention and finally lifetime value. Too often businesses invest substantially in paid advertisements to acquire new customers. However, if that customer only makes one purchase, his customer lifetime value will be low or negative since the cost to bring him in outweighs the gross margins. Consequently, the ability to encourage repeat customers or increase each order value from your existing customer base is a priority in order to ensure long-term profitability of your eCommerce.
In terms of effort, it’s usually much harder to win over a new customer than to get repeat customers. For new customers, you will need to put efforts into convincing them to trust you as a business. Whereas, someone who has purchased from you before will buy from you again (assuming, of course, that they are satisfied with the previous experience) with the right reminders and incentives. Your brand credibility is already there.
Hence, a loyal customer is worth more than a new customer.
Marketing campaign automation for growing loyal customers
Similar to the process of lead nurturing, getting repeat purchases require deep insights on what’s most important to each of your customers. It also requires the ability to deliver personalized communications and at the point in time that customers are most receptive to you. All of these capabilities are where marketing campaign automation software such as ContactPigeon comes to play.
There are 2 essential principles to keep in mind for building loyal customer base.
The first is to stay relevant as a brand. This means finding the opportunities to get in touch, such as holidays, sales, news or special events. It’s important, however, to maintain a balance in terms of frequency, aesthetics, and content of your communications. Frequent or overload of brand promotion often results in brand fatigue. A way to gauge that balance would be to monitor engagement levels of your audience. If you see a dip in the response rate to your campaigns in terms of opens, clicks, replies, and sessions, then perhaps you should adjust the frequency or content of your messages.
The second is to stay personal in the way we connect with the customer. As humans, we respond better to messages that are addressed to us personally. This means that tailored recommendations, contents or even the style of your campaigns work better to engage your customers.
Below we share 3 email automation ideas for getting the repeating customer in a relevant yet personal way.
We all remember a time when we put a load of laundry only to discover that there’s no more detergent. Ugh… Wouldn’t it be great if there’s a way to restock frequently used products before they run out? Well, there is and it’s a great way to engage customers by reminding them of products that should be purchased again. This is where Repurchase Reminders shines.
As the name suggests, Repurchase Reminder campaign reminds shoppers of the products they have purchased before with the goal of driving a repurchase. This marketing campaign automation tactic is most effective for consumable products that require consistent replenishment. Great examples of such are skin care products, baby diapers, pet food, etc.
To set up Repurchase Reminders, you need to identify the product or product category that is eligible for repurchase. You also need to determine the optimal time interval between repurchases for a typical customer. Once you have the two conditions, you can use your marketing automation tool to generate reminders to customers who purchased the specified products at a regular frequency.
For optimal outcome, we suggest the reminder to be sent approximately one week prior to the typical reorder time. This ensures your customers ample of time to react to the campaign and reorder before the previous product runs out. For shoppers with a busy lifestyle, this type of campaign is actually a welcomed messaged for a change. You’re also building brand equity for your business by doing so. Better yet, this tactic allows you to get to your customers before she or he goes to a potential competitor. Win-win indeed!
Another good strategy to bring your customers closer to your e-shop in a delicate way is Anniversary Reminders. By anniversary reminders, we are not only referring to wedding anniversaries, although that’s certainly a good opportunity to celebrate with your customers (e.g., hint for fashion, jewelry, chocolate retailers out there). We are specifically referring to purchase anniversary, either based on the 1st order or last purchase date.
Although this marketing automation scenario can be used for all customers, it’s especially potent for customers who have been inactive for a while. The idea is to send a Happy Anniversary campaign to the customer ahead of the anniversary commemorating this special date. As part of the email campaign, remind your customer of the product that was previously purchased along with a thank you. You should include recommendations of similar or complementary products to the one featured as well (e.g., something from the latest collection, etc.) Lastly, it’s customary to include a little something special such as a personal discount or small gift to complete the anniversary email a customer could celebrate on.
Birthday emails can complement your efforts to create a bonding relationship with your customers as well. It is a way to extend your gratitude for their patronage, and distinguish you from the competition.
A common challenge that eCommerce businesses face is soliciting personal data, such as birthdays, from reluctant customers. There are several ways to overcome this. One way is to be upfront about why you’re asking for the birthday. Most customers will be willing to provide the info if you let them know that you plan to send personalized offers. Another way is simply ask for the birthday month, which is less sensitive than giving away the full date. Alternatively, you can also make it fun by asking for the zodiac sign. After all, all you need for a successful Birthday Reminder campaign is an approximate range and an “excuse” to reach out!
Ideally, the birthday reminder campaign is sent during the month of the birthday. It should consist of a witty Happy Birthday greeting and a “gift” in the form of a giveaway or discount. A good example of the birthday email is from NeedSupplyCo. An effective tactic NeedSupplyCo applied is to limit the birthday “gift” to a specific timeframe (e.g., birthday month) after which the offer will expire.
In conclusion, personalization is king
Building loyal customers requires innovative and consistent effort to keep your brand relevant and your marketing intriguing to the customers. A key way to achieve that is to use marketing campaign automation to keep engaging your customers at the opportune times with personalized messages. Repurchase reminders, anniversary and birthdays campaigns are just a few tactics that have proven to work for eCommerce. Oddly enough, not a lot of eCommerce has adopted these tactics yet. Adding these tactics to your marketing arsenal will increase your repeat customers and set you apart from the crowd.
Also published on Medium.