To understand customer retention, actually, we need to understand what is retention?

Retention

We need to understand that ecommerce is not profitable as in the past. There are ten thousand players. After the Covid19 incident, brick & mortar companies understand that the main cashflow should be digital. Since they know that they will not be able to have a single penny if no ecommerce.

So, the upcoming year will be more exciting and way more challenging because customer acquisition costs will increase since there will be more bidders.

So, what is the solution for this? Increasing customer retention rate, buying frequency, and increasing overall LTv of each transacted customer.

Average Transaction to Be Margin Positive in 365 Days

Fashion: 2.4

Beauty & Cosmetics: 2.2

Electronics: 3.1

Home & Deco: 2.3

Food Delivery: 3.6

Grocery: 4.9

Also, 20% of your buyers should be buying in the averages shown above.

So if you are having the numbers above, you do not have the retention problem. However, it is in most cases not even close.

Where to Focus:

1. Onboarding process of the user.
2. Mapping the entire experience of the user

Onboarding process of the user: 

In our previous article, I have used the Casino description for Google & Facebook. Since in this game, they never lose. 

So, getting clicks is the easy part. However, acquiring(info to contact) is the real acquisition. Even if you have the 1st transaction, 90% of customers in ecommerce does not make the 2nd purchase!

That’s why users should be approached by retailers in a different manner and map the entire experience of the user.

Mapping the entire experience of the user:

There is really important preparation that you have to do before mapping the entire user journey. Before starting to map the journey, you need another strategy to map the journey.

Persona:

You need to create user groups and define different user journey maps and engagement strategies. You need to have:

• First Time Buyers
  • Silent Buyers
• Potential Second Time Buyers
• 2nd Time Buyers
  • Silent Buyers
• Retained Users
• Potentially Churn Users
• Churned Users

If you have looked at the user types above, every group has a different flavor in their mouths. So you should not treat them with a generic message.

To have the right message for the right user and you need to give this message when the time is right. You have to personalize the whole user journey.

Time Frame: 

In each stage of the lifetime, you need to have time frames to engage with the user. However, again timeframe depends on the vertical for example session to the transaction is too long in the Home & Deco vertical(95) days whereas fashion is not.

In this case, getting support from a consultancy agency like 3WL is a wise decision to be supported in a professional manner together with sectoral benchmarks.

Channels:

You cannot treat the customer in different channels. Since the users who come from youtube while watching a video have a different motivation level than the users who search for Adidas SuperStar red 37.

So the point that I am trying to achieve the motivation level of these 2 channels is different. So, you need a different approach while generating traffic on each channel.

Behavioral Targeting & Segmentation:

The most crucial information that we need to focus on is the Behavioral and Attributed information of each user.

So marketers should decide, Who, What, When, Why, and How. This requires sophisticated marketing/vertical knowledge, experience in different verticals in ecommerce as well as vendor capabilities.

In most cases, marketers are failing in the project implementation and management phase. In such cases, it is better to stay away from conversion optimization. Since it is a waste of money if there is no one reliable like 3WL partners.

How can 3WL help?

What we grant in our services:

• Understanding what users do and analysis of the whole user journey.
• Set up and increase the performance of the Acquisition, Activation, Revenue, and Retention journeys.
• Develop a fully integrated nurturing strategy with marketing automation.
• Engage users with personalization, from engagement emails to feedback forms.
• Connect your teams to improve Customer Journey Map touchpoints with a 360-degree approach.

Reach us out here: https://www.3wl.co/contact/