Growing your business and customer base is a chief concern for any e-commerce business. As a result, determining how to effectively attract and retain customers is just as important as any stage in your operations workflow.
To explore the best practices when it comes to fueling business growth, we spoke with Shannon Arthur, Marketing Manager at Canada Post. In the Q&A below, Shannon shares some of the best ways to cultivate and grow a customer base for a business. Shannon, and other experts like her, regularly share their insights on e-commerce trends at Canada Post’s exclusive event series for growing e-commerce businesses — GROW.
Question: What’s one thing merchants always want to know when it comes to growing their customer base?
Answer: Merchants are always thinking about how to attract and retain loyal customers. They’re keenly aware of the many benefits of turning one-time customers into repeat purchasers. Here are some benefits that spring to mind:
- Loyal customers buy more than new ones. If you maximize your existing customer base, you could be sitting on a mountain of profit. There’s something called the Pareto Principle which boils down to the idea that 20 per cent of your customers represent 80 per cent of your sales.
- Loyal customers are great advocates. They spread positive word-of-mouth about your business and can help you raise awareness and increase acquisition tremendously.
- Loyal customers cost less to keep than new customers cost to attract. Customer retention requires far less of your marketing budget than customer acquisition and raising awareness will. You’ve already converted the customer, now you just have to keep them.
Question: So it sounds to us like loyal customers are perhaps the best customers for a business. Would you agree?
Answer: Yes, they absolutely are. They are invaluable to the success of an e-commerce business.
Question: So, how can customer loyalty be encouraged?
Answer: The most important thing to remember is that every customer has the potential to become a loyal customer for your business. Every time a customer purchases from you, visits your website or walks into your store, your relationship becomes stronger. Nurturing those relationships will inspire your customers to champion your products and services, creating referrals and word-of-mouth buzz that could lead to the acquisition of new customers for your business.
Building loyalty is all about staying relevant for individual shoppers whenever and however they choose to interact with you. Sharing relevant messages with your customers builds trust and keeps your business top of mind for customers when they are ready to shop again.
Question: Are there specific things businesses can do to encourage customers to become or remain loyal?
Answer: Definitely! Take advantage of opportunities to reach out to your customers. If they’ve signed up for your email list, follow up with a thank you for joining message, providing contact details for the customer’s nearest store, or showcase the benefits of signing up with your business. There are many opportunities to deliver impactful and relevant customer messages and experiences.
Return and repeat purchasers generate a disproportionately large share of revenue in most e-commerce businesses, so it’s in your best interest to pamper these customers.
If you can demonstrate to your most loyal customers that you’re willing to go the extra mile for their business, it will make them feel special and increase cross-sell or up-sell.
Convert one-time customers into loyal shoppers. Learn about the six key drivers of customer loyalty.Download the report
Question: Is there a way for a business to market its products and services directly to its loyal customers?
Answer: Absolutely! Most digital marketing budgets are spent on media that doesn’t effectively target more productive customer segments. There’s incredible potential for revenue gains if you learn to better target segments with potential. Direct mail works brilliantly for this. It’s a very effective booster for online activity. It speaks to a customer’s senses of touch and smell and addresses their need for tactile experiences. This is where things like catalogues and vouchers can really shine.
Question: But how can direct mail be used for e-commerce?
Answer: Your customers go through the end-to-end purchasing path, and that path starts with acquisition and ends with loyalty.
This is where marketing comes in and your mix becomes critical – bridging the gap between online and offline activity is essential. Let’s say you’re using drive-to-web or store advertising through a social media campaign. That campaign can be followed by a direct mail piece that reminds customers to take action.
A great example of this is Maplelea dolls. They use physical marketing strategies to support their digital outreach. The backbone of their entire marketing program is a traditional, paper catalogue. That catalogue supports their e-commerce efforts by driving readers to a Shopify store on their website. For the price of an online click, Maplelea can get their catalogue into the homes of potential customers, where it gets held, read, and stays around much longer than a digital ad. Even in the digital era, their catalogue reigns supreme.
Using direct mail to further expand your online reach will only make your opportunities bigger. Our research shows that integrated direct mail and digital campaigns elicit 39 per cent more attention (time spent) than single-media digital campaigns1. Including direct mail in your marketing mix can garner greater attention, heightened emotional engagement and stronger brand recall.
In today’s digitized world, where people are constantly bombarded with advertising messages, the effectiveness of direct mail as a tactic should not be downplayed. As marketers continue to shift more emphasis to digital media (online, social and mobile methods), direct mail remains a key driver of positive results, especially when part of a broader, integrated campaign strategy.
Pairing direct mail with digital works both ways. Multi-media campaigns with direct mail have stronger consumer engagement than single-media digital campaigns, and direct mail makes the most impact when it follows a digital message.
Question: Any final thoughts for e-commerce business owners, Shannon?
Answer: If you haven’t used direct mail to engage and reward loyal customers, it’s high time to add it to your marketing mix. You could propel your sales to a whole new level with this time-tested marketing approach, and even enhance the effectiveness of your digital campaigns.
1 Canada Post. Connecting for Action, 2016
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