During economic downturns, returning customers can be the lifeblood that keeps your business’ head above water. In times of growth, they are also likely to be your biggest spenders. Here, we’ll examine why customer retention is so important and explain how to keep visitors coming back.
The importance is in the statistics
One of the first reasons returning customers are important for websites is that, when compared to new customers, it costs less to acquire them. You can calculate the cost of acquisition by dividing your marketing and advertising spending by the number of new customers you get. If you spend £100 on PPC ads, for example, and get 10 new customers, each customer will cost you £10 to acquire. The cheaper you can acquire customers, the bigger return on the investment you make. According to OutboundEngine, retaining an existing customer can be five times less expensive than acquiring a new one. In times of economic downturn, the difference in acquisition costs can be crucial in ensuring the health of a company’s cash flow.
Returning customers are not only cheaper to acquire; they are also easier to sell to. The success rate of selling to returning visitors is around 65% while for new visitors, the figure can be as low as 5%. As these customers have already experienced shopping with you, they’ll have confidence that your business will continue to provide great service, making them more inclined to return.
What’s good about this is that a 5% increase in customer retention can equate to increased profits of anywhere between 25% and 95%. Underlying this is another recent study which found that returners converted over 70% more than new visitors, added 65% more products to their shopping carts and spent an average of 16% more on each transaction. With these figures in mind, the importance of customer retention is obvious.
How to get visitors returning
- Reward loyal customers
Loyalty programs have been in existence in one form or another since the 1700s and the reason they are still so popular is that they are highly effective. Today, of course, we have come a long way from the Green Shield Stamps and Esso tumbler vouchers which were so popular in the 1970s and 80s.
With websites, you can automate the process of rewards, with loyalty program plugins automatically rewarding customers with points every time they make a purchase. You can then offer them discounts or other deals which they can spend the points on. You can also offer members of your loyalty scheme other benefits, such as prior access to new products or sales. - Set up an email newsletter
Building a list of email subscribers enables you to connect directly with existing visitors and customers for free, rather than having to pay for advertising. A newsletter is a way to engage them with content marketing, a proven marketing strategy that focuses on solving customer problems rather than on the hard sell. You can encourage visitors to subscribe by offering them discounts, special deals or gifts in return for signing up. - Be active on social media
Setting up business pages and posting on the most relevant social media sites for your brand can go a long way to generating customer loyalty. Existing customers will be able to follow your posts and see what new things the company is doing and the new products or services you are selling. They can also become brand ambassadors, liking and sharing your posts and thus helping to generate new visitors as well. With social media now driving a third of all website visits, this can be an effective way to keep those social savvy customers coming back. - Enable push notifications
Not so long ago, notifications were only available on mobile apps. Today, you can use them on websites too. You may have seen popups appearing at the top of browsers with the text: ‘This site would like to send you notifications. Accept / Decline.’ By enabling this feature, you will be able to send users notifications about new content, offers and promotions that link directly to your website. There are plenty of free push notification plugins that you can use to add this functionality to your site. - Post relevant and engaging content regularly
You can encourage customers to keep returning by ensuring that each time they visit, there is something new for them to engage with. Even if you still have the same range of products or services, regularly adding fresh content that includes a healthy mix of blog posts, videos, images and infographics will ensure there is always something new to experience. Make sure that the content is relevant and of value to your customers and is of high-quality.
At the same time, if you have old content that no-one is engaging with, you can repurpose it to make it more relevant. Give it a new title, update the information to make it relevant, add more recent and striking images and then repost. - Retargeting ads
If your advertising budget needs to be more wisely spent, it can pay to target those shoppers who have already visited your site rather than casting the net wider for new visitors. Retargeting, using Google Display Retargeting or Facebook Retargeting Ads, is a well-established strategy where ads are specifically created to entice those who have interacted with your business before, such as by visiting your site, interacting on social media or watching one of your videos. The benefit is that these consumers have already shown some interest in your brand and are more likely to return and purchase than an ad viewer who has never engaged with you before. In this way, your marketing budget is likely to have a bigger ROI.
Conclusion
Returning visitors are essential for businesses during difficult economic periods. Compared to new customers, they are less expensive to acquire, will buy more products and spend more per visit. They are also more likely to follow you on social media, sign up for emails and join loyalty programs. Hopefully, by following the suggestions discussed here, you’ll be able to retain more customers and get them returning to your website.
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