The holiday shopping season provides a unique opportunity to attract new customers who are trying to find the perfect gift for everyone on their list. Your ecommerce business is likely channeling lots of resources (and money!) to target these new customers, so why not maximize this effort by turning these one-time shoppers into loyal customers?
It costs five times as much to attract a new customer than to retain an existing customer, and return customers are more profitable in that they tend to buy more from a business over time while the amount you spend to attract these recurring customers declines.
Here are four ways you can win back those holiday shoppers:
- Start a “Custom Audience” Facebook campaign
Ecommerce sellers can review their order history and then sort customers into specific groups (such as “customers who bought Product A” and “customers who bought Product B”). You can then create a special promotion for these customers and target them specifically on Facebook (and Instagram, which Facebook also owns). How? With Facebook Custom Audience, you can upload customer email lists and/or phone numbers and, if matched in Facebook, start sending them specific ads. Learn more.
- Promote gift cards on your site
According to Accenture’s 2017 Holiday Shopping Survey, 71 percent of respondents plan to purchase gift cards this holiday season, spending an average of $42 on each gift card. Offering gift cards makes it easy for the gift giver but also makes it easier to grow site traffic, first from the actual purchase of the card, and then from the order that comes when the recipient cashes in their card. It could also result in increased revenue—the person giving the card might come back for another one the next time they want to give a gift, and the recipient might end up spending more than the value of their gift card. Many shopping cart programs now offer the ability to offer online gift cards, making it easy for your ecommerce business to accommodate holiday shoppers.
- Provide an incentive to come back to your store
Sometimes, a customer just needs a little nudge to come back to your store, so make sure to provide them an incentive to come back. Nothing entices people to buy like a good deal, so consider contacting inactive customers with a special discount. You can send this campaign directly to inactive customers, and since you’re segmenting your audience, you can personalize the message for this specific group. For example, send a promotion via text message or email that says, “We miss you. Come in this week for 25 percent off your entire order.” Plus, if you are using email, you can segment the discount to focus on the type of product they purchased—“We’ve got more of your favorite sweater in stock. Try a new color and save 30 percent!”
- Use discount ladders
Drew Sanocki of the Nerd Marketing podcast says a discount ladder “is basically a system that ramps up the magnitude of the discount or the promotion, with the increasing likelihood that the customer will never come back.”
In other words, you start off with a smaller discount, and increase it with every email as the likelihood of a person to never come back to the store also increases. For example, you offer a customer who hasn’t purchased anything from you in 30 days a 10 percent discount. If they still haven’t bought in another 30 days, you offer them a 20 percent discount. If they still haven’t purchased in another 30 days, increase the discount again.
Discount ladder promotions work because customers go through phases, says Sanocki. After the initial engagement, when they visit and buy from your site, they enter a phase in which their interest in your brand begins to fade. Eventually they detach and no longer care about your business. As a customer’s interest wanes and their likelihood to revisit your site, you can risk that higher discount knowing that fewer customers may take you up on it (and you’ll lose less because of the discount).
Considering the fact that increasing customer retention by just 5 percent can grow you company’s profits from 25 percent to 95 percent, it seems worthwhile to devote your efforts to bringing holiday shoppers back for more by trying the four techniques mentioned above.