For e-commerce, businesses with over 35% retention rate are considered to be the top ones already. However, in 2016, Amazon's Prime membership had a customer retention rate of 91% for first-year subscribers renewing for a second year. Why is that?
If you want to boost your customer retention rate, learn from Amazon. Here are seven lessons:
1. Create A Meaningful User Journey
Amazon's home page has clear categories with best-selling products featured. The well-designed site provides plenty of attractive calls to action (CTAs) to get customers to subscribe to its email newsletter to stay up to date on the latest products, or products that fit users' needs. The entire user journey is carefully planned.
If you want new customers to understand your brand and products better, provide space for them to leave their contact information so that you can engage with them about your unique solutions. A creative way to craft a meaningful user journey is to have users take a quiz or assessment that can categorize users into different groups based on their needs.
2. Personalize The Customer Experience
A generic offer may be able to reach more people, yet it's probably targeting no one at all because it does not provide a solution to their specific problem. Amazon's algorithm enables product recommendations that fit a customer by analyzing their previous purchases and what they've saved or clicked on. The site also enables customers to "subscribe" to a product, so customers can get a product delivered to them regularly.
Something you can try with your brand is to send reminder emails or notifications to your customers who have already added some items to their wishlist or to their cart but haven't yet purchased them. Since these are items that your customers actually want, a thoughtful reminder is less likely to be disturbing and can encourage them to make the purchase.
Another idea is to recommend customers to order items that are related to what they have already purchased. For example, a customer who has purchased an ergonomic chair may be interested in a standing desk or other ergonomic furniture.
3. Make Your Customers Feel Valued
Amazon has its Prime Day event, which is exclusive for subscribed customers. If you're not a subscriber, you'll miss out on a lot of great offers and deals.
If you want to get your customers to engage with your brand more, consider campaigns that will make them feel like an insider. For instance, offer discounts exclusively for subscribers or free giveaways for loyal members. Another idea is to run regular special offers for loyal customers, such as letting them be the first to experience new products. Customers who enjoy the privilege of special offers and services may be more likely to stay loyal.
4. Be Creative When Keeping Users Updated
The email newsletter is a common way to keep customers up to date. It has its perks and can be effective; however, maintaining a high open rate is a challenge for many brands.
Amazon has adopted the opt-in notification feature that allows push notifications to users when they visit the site. This feature can reduce the dependency on only emails to get users the latest updates. It's a less passive method of reaching customers.
When sending shoppers notifications they've opted in for, be creative about the content. Don't just keep sending information about your products, offers and deals, as this is likely to annoy shoppers. Always keep your customers' needs in mind. Send them practical tips and information about their concerns while reminding them that your products can help. You may even consider asking customers how often they'd like to receive these notifications so that they won't feel disrupted by your brand.
5. Simplify The Checkout Process
This may be an obvious step, but there are brands that forget about the importance of keeping the checkout process simple.
Remember to keep the layout of the checkout page simple and user-friendly. Try not to ask for too much information from the shopper — just the essentials for making a purchase. Besides storing the user data for a quicker checkout next time, like how Amazon makes return purchasing easy, enabling a diversity of payment methods, such as credit card, PayPal and Apple Pay, can also add to a user-friendly experience.
6. Optimize Shipping And Delivery
Free shipping and same-day delivery for certain items can make purchasing from your site convenient — especially during the pandemic, when lots of purchases rely on shipping and delivery. Even if you are not able to deliver products within the same day, like Amazon does, you can still try your best to optimize your delivery service.
7. Have A Friendly Return Policy
One of the biggest concerns customers have when purchasing online is whether or not the product will be what they're looking for — quality, fit, etc. Customers may be reluctant to buy from a brand online if it has a strict return policy.
A simple procedure that allows customers to return products they aren't satisfied with can encourage them to shop for more. For example, Amazon and most sellers on the platform offer returns for items within 30 days of receipt of shipment.
To encourage shoppers to purchase from your site, spell out your return policy where it's visible to shoppers. Also, provide simple ways for customers to contact you for support if they have any questions about their purchase. This can assure customers that they can always get help from your brand when they need it.
Even though you may not have as many resources as Amazon, there's still a lot you can do to improve customer satisfaction and achieve a higher customer retention rate. Learn from these strategies, and take steps to improve your customer experience.