Guía completa de retención de clientes en español

Complete Guide to Customer Retention in Spanish

Shopify Meetup Buenos Aires Reading Complete Guide to Customer Retention in Spanish 13 minutes Next Retention Marketing in Times of Recession

When was the last time you looked for new opportunities to bring more customers back to your store? If you don't do this exercise on a regular basis, it's time to put it into practice and get the most out of it. Remember that the cost of getting current customers to repeat their purchases is less than the investment in efforts to find new customers. That is why in today's blog we will teach you how to create a good customer retention strategy for your online store.

What is customer retention?

Customer retention is the set of strategies and efforts a company uses to increase the number of repeat customers and maximize the profitability of each existing customer.

Customer retention strategies allow you to extract more value from your current buyer base, encouraging them to stay with you, have a satisfying experience, and continue to benefit from your products.

In short, acquisition creates a customer base, while retention strategy is how you build relationships with consumers and maximize the revenue attributed to each of them. But how much time and resources should you dedicate to your retention program? The answer to that will depend on the characteristics of your store and its needs.

When to execute a customer retention strategy

The strategic approach in customer acquisition or retention depends to a large extent on the life cycle in which your store is located. There is a big difference between a store that opened its doors yesterday and is looking to acquire new customers, compared to one that has been around for years and has a large repeat customer base.

Here's an overview of when you should and shouldn't activate your customer retention tactics:

  1. Launch - When you have just started your business there is one thing you should focus on: being seen by people who want to buy your products . At that point, your acquisition efforts should be greater than your retention efforts, seeking to increase your customer base.
  1. Gain traction - You already have customers and you get sporadic sales. At this stage, you can start to introduce retention elements to encourage your current customers to buy more.
  1. Build Consistency - You're not an eCommerce giant yet, but sales are picking up. This is the point where you should start thinking about combining retention efforts with acquisition efforts, and you can achieve this through a referral program, membership, or marketing automations. Remember that in this case the purpose will always be to increase the profitability of each client.
  1. Establish yourself - You now have an established and sustainable e-commerce store. Acquisition can lead to many one-time purchases, but a retention strategy can drive customers to buy more often, increasing their lifetime value and continuing to grow your business.
  1. Loyalty - At this stage your store has overcome challenges, achieved success, and has many processes and automations in place. Now is the time to focus on retention.

For example, in the graph below, each store has 100 customers who purchase a $10-valued item each month. The light purple store retains 5% of those customers each month, and the dark purple store retains 10%. Here is the 5% increase that can lead to rapid growth and difficult to match with a direct acquisition.

Download: Your FREE checklist to perform a retention audit

This free checklist will help you develop a retention plan for your e-commerce, focused on auditing all retention strategies at different stages of your business. Download it here !

How does retention fit your business?

The products you sell are directly related to the strategy you should focus on. A retailer that sells household appliances of different references will be categorically different from a store that sells skin care products or nutritional supplements. In turn, a store where customers buy high-value items frequently will have the highest Customer Lifetime Value (CLV). These are the types of stores that have the best chance to win with a strong retention strategy.

This matrix allows you to visualize where the industry to which your business corresponds is located. That way you'll know if you should start focusing more and more on a retention strategy. But remember, it's all about finding the balance between acquisition and retention that benefits your business.

The customer retention metrics that matter:

The key to improving your customer retention rate is understanding the underlying metrics. But what are these metrics? How do you measure them? And more importantly, how do you improve them?

Answering these questions will equip you with the tools you need to create a customer retention strategy that will make a significant and lasting impact on the profitability of your business. The three main metrics for tracking customer retention are:

  1. Regular customer rate
  2. purchase frequency
  3. Average Order Value (AOV)

1. Rate of repeat customers

The repeat customer rate is the backbone of customer retention. It begins by measuring the percentage of consumers willing to make a second purchase. Measuring your repeat purchase rate is a great way to gauge how well your retention strategy is working. Remember that the higher this metric is, the more willing customers will be to return to your store.

How to calculate the repeat customer rate?

When it comes to measuring retention metrics, it's easy to get lost in a sea of ​​complicated calculations. Fortunately, calculating the repeat customer rate is quite simple and only requires two pieces of information: the number of customers with more than one purchase and the number of unique customers.

You should take into account the period you want to calculate, but the recommendation is to look at a full calendar year to get the big picture. When you have those two pieces of data separated, you are going to divide the two digits and multiply them by 100. The equation would be:

# of customers who buy more than once / # of unique customers * 100 = repeat customer rate

2. Frequency of purchase

Purchase frequency is about how regularly consumers buy from your store. This is especially important if you consider that repeat customers are responsible for a significant portion of the store's annual revenue depending on the product category.

How to calculate the purchase frequency?

Calculating the purchase frequency of your store is similar to calculating the rate of repeat customers. Using the same time frame you chose for your repeat customer rate, divide your store's total number of orders by the number of unique customers.

When you write this equation, it looks like this:

# of orders placed / # of unique customers

3. Average ticket value

Once you analyze your repeat customer rate and purchase frequency, it's time to maximize the value of each of those purchases. This metric is known as the average order value , and it refers to the amount of money a customer spends in your store for each transaction.

How to calculate average order value?

Like purchase frequency, average order value should be calculated using the same time period you used to calculate your repeat customer rate. Then all you have to do is divide your revenue during that time period by the number of orders your store processed.

When you write this equation, it looks like this:

Total revenue earned / # of orders placed

Value of Every Customer: The Big Picture of Retention

Customer value is the final piece of the puzzle ! The ultimate goal of retention marketing is to increase customer value. To calculate this metric you must have constant control over the frequency of purchase and the value of the average ticket. By multiplying these two values, you can really see the fruits of your labor and understand the power of retention marketing.

When you write this equation, it looks like this:

Customer Value = Purchase Frequency * Average Ticket Value

Now is the best time to create a customer retention strategy and discuss how to improve each of these metrics to grow your business.

Strategies to increase customer retention

We've already examined the importance of developing a strategy to retain our current customers and discussed why it's just as valuable, if not more valuable than finding new customers. Now we are going to discuss some marketing tactics to improve and increase customer retention. These tactics include:

  1. Encourage the creation of user accounts
  2. Improve your customer service
  3. Start a loyalty program
  4. Send engaging emails
  5. Offer discounts or credits

1. Encourage the creation of user accounts

User accounts in online stores can be a double-edged sword. On the one hand, they make it easy to buy again, since they offer instant access to previous orders or even abandoned carts. But on the other hand, creating user accounts is often seen as too big of a commitment for new customers.

Because of this, many people choose to check out as a guest and not create a store account. So how can you effectively implement and encourage user accounts without impacting new customer conversions?

A good solution is to add the option to create your user account after making the first order, that way you can secure the order and offer benefits or rewards for being registered.

For example, platforms like Shopify allow you to send direct invitations to customers to encourage them to activate an account after they've completed a purchase.

2. Improve your customer service

Support systems are designed to foster effective communication between your business and its consumers. A support system can help both before and after the sale, as it allows establishing clear and direct communication with the customer.

Having a live chat or landing page with troubleshooting resources can turn a customer question into a sale, or a complaint into a solution. And this is not to mention the value that customer feedback can generate, helping to improve both the quality of your products and the overall shopping experience.

The data suggests that fast, friendly and consistent service is perceived by most customers as the gold standard.

3. Create a loyalty program

Loyalty programs are an agile way to increase purchase frequency by motivating customers to shop more often for valuable rewards.

As an example of a successful loyalty program, we share that of the Sephora cosmetics brand. This brand offers its customers a card called Beauty Club , with which they can accumulate points for every dollar they spend on their purchases. Customers who accumulate their points will be able to redeem them for beauty items at the time of making their next purchase. The formula is clear: buy, accumulate points, and later redeem them for beauty items.

Creating a loyalty program can be as simple as rewarding customers on their second purchase or after spending a specified amount on your products or services. Your store reports, on platforms like Shopify, make it easy to see who your best customers are by dollar value and their total number of orders.

4. Send engaging emails

If purchase frequency is the backbone of customer retention, email marketing is a mainstay for customer engagement. Emails give you the opportunity to continue to build a relationship with your customers before and after their initial purchase. It is essential that each message you send adds value to the customer experience, because if you don't, you risk losing them.

Shopify's data for Black Friday and Cyber ​​Monday also shows that relative to other sources, email has the highest conversion rate at 4.29%, followed by search at a close second. It is proven that email is a channel that generates conversions!

A great way to start communicating with your consumers via email is to follow up. Within a week of a customer's first purchase, send them an email thanking you for their purchase. This type of recognition helps customers feel good about their purchase decision and makes your brand more accessible.

Make this initial email even more impactful by including a product recommendation to complement their initial purchase. You can even include customer reviews that serve as endorsements of the value of each recommended product.

After you've sent this initial follow-up, you'll want to make sure you're sending custom messages on a regular basis. Beard King does this beautifully, sending out emails offering new products or discounts every two to three weeks.

If you have a product that is perishable, consumable, or needs to be updated over time, knowing its useful life and sending emails at the right time can be the perfect way to win back inactive customers.

In all marketing communications after the sale, remember to highlight the differential value of your brand. Don't forget that keeping customers coming back depends on your ability to show them why an additional purchase is worth their time and money.

5. Offer discounts or credits

Another way to keep customers coming back to your store is by offering a discount code for their next purchase. For this reason, discounts for a buyer who has purchased your product for the first time and will only make their second purchase, results in a pleasant experience.

You can strengthen that nudge to keep them coming back by giving them more than the standard 10% discount. When you look at a 20% discount as an investment to increase your customer retention rate, it sounds a lot more reasonable.

However, you must be careful with discounts and avoid entering the perpetual race that conditions customers to wait for a price reduction to go buy at your store. This can result in a loss of income and differential value for your business.

Keep your customers and grow your business !

Don't forget that your current customer base is the best asset your store has. Customers already know your brand, your products and appreciate your service. Now, focus your time and energy on improving the shopping experience, and on exploring new ways to grow your business and boost revenue from your online store.

Content inspired by the original Shopify Learn blog: Customer Retention 101: Grow Your Business by Selling More to Current Customers

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