4 Customer Retention Strategies

In the world of mobile commerce, you first have to launch your business’ app, and then get people to download it. This begs the question: after going through such a lot of trouble to execute your app and get it downloaded, aren’t you going to do anything to keep these people coming back to use it?
Speaking in broad strokes, there are three ways to increase revenue: 1) increase your average order value (AOV), 2) increase the frequency of purchases, and 3) get more customers. Most people follow point 3 very diligently and forget points 1 & 2. You put in so much money, time and effort to increase footfall, shouldn’t you take the pains to retain them? What a lot of retailers seem to overlook is the opportunity missed by not capitalising on repeat customers. It’s actually less expensive than gaining new ones. In this blog we focus on customer retention using mobile commerce and the strategies to work it well.

  1. Cross-sell and up-sell
    Cross-selling is about suggesting related items to a person when they check out. If someone buys a trench coat, you suggest matching wellies, a smart brooch or even a chic leather bag. So your offerings are a mix of practical items and fashion ones, too.
    Up-selling is encouraging a shopper to upgrade to a higher priced item. Someone is ordering a kilo of regular mangoes, you recommend the seasonal alphonso mango for its superior quality of flavour, sweetness and richness. The seasonal availability might encourage a buyer to overlook the slightly higher cost in order to try out a higher quality.
    If you sell only one or very few products, try offering a special service for an extra charge, or try pairing up with a local non-competitive business that can complement what you are offering. For instance, if you are a home-delivering florist, tie up with a local chocolatier. Flowers and chocolates seem to be the standard, acceptable combination and let the buyer purchase both under the same roof.
  2. Subscription services to bring them on-board
    You may think that you lose more money by offering services and offers to people who subscribe. Wrong! You can balance it out quite well. Fee-based membership programs make patrons return (because who isn’t hardwired to like a little treat), and furthermore it establishes loyalty. You need to take care to provide the kind of incentive that will make customers want to subscribe, and device a strategy that helps you absorb the additional cost either through seldom purchasers’ subscription fees or non-members.
    It benefits you in the long run: they pay a small fee and reap the rewards; you retain your customers and cash in on their repeated patronage.
  3. Create the opportunity to create multi-buyers
    Ideally 20% of your buyers would give you 80% of your business. That’s the industry standard for good retention rates. To leverage this, first study your demographics. With mobile apps you become privy to real-time analytics and shopping patterns. You mine this information to analyse them and figure out ways to remove obstacles in their path.
    Generally people have a particular shopping behaviour. You can make clever decisions using this data. For instance, if a customer returns after 3-4 weeks, you know that timeframe is their usual pace. Instead of offering incentives to draw them back, send them push notifications of new products you are stocking or items related to their previous search. This hurries the process along. If they don’t return, then use offers or staggered promotions – the discount ladder. 10% to lure them back, 20% as stronger bait, 30% to really whet the appetite, or cash backs, expedited shipping, free shipping, or free gifts. Finally, make use of the purchase receipt e-mails to either cross-sell, or at the very least use the e-mail ids received for further retargeting marketing efforts.
  4. Push Notifications
    First of all, this feature lets you target campaigns specifically to the right demographics and buyer personas (which we presume you have created). Secondly, it is the fastest way to reach your audience – firstly because your message gets delivered immediately, and secondly because mobile phones are usually always on a person’s person and they are bound to look at it often during the day.
    Push notifications can be used for so many things – you can inform people about new products, offer promotions and flash sales, send them reminders about items they may have abandoned in their e-trolleys previously, inform them about any sale or promotion in connection to the abandoned item…the list goes on. And best of all, unlike e-mail, they know they aren’t getting spam!

While this blog emphasises the importance of repeat customers – and for very good reason, too – the bestest best strategy is to focus on all three multipliers that were mentioned earlier – AOV, purchase frequency and retention, so that you are working all of them equally without burning out any one source. But in order of priority, customer retention is at the top!


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