Repeat buyers, repeat business

20 Smart Ways to Drive Repeat Business (Part 1 of 2)

What do Marlboro, the New York Times and Amazon have in common? Besides being some of the most iconic brands of our times, every single one of these brands boasts of legions of loyal customers. And they profess their loyalty the best way any customer can – by buying from these brands over and over again.

Building repeat business and eventually a large and loyal customer base is not the prerogative of well-funded, marketing heavy-hitters. Small businesses have the power to attract repeat customers with the right attitude and marketing strategies.


Why focus on repeat buyers?

As marketers we are acutely aware that our biggest focus is bringing in new customers. The entire industry is focused on where we can find new customers, how to influence them, how to convince them that your product is awesome and finally how to get them to fork over big bucks and buy from you.

However, if you take a pause in the mad, mad whirl of activity that most marketers live in and reflect for a moment, you’ll notice the futility of this hamster wheel we’re caught in.

Repeat Buyers vs. First Time Buyers

Repeat Buyers vs. First Time Buyers


Take a look at the figure above. You’ll see that repeat visitors account for just 8% of total traffic on U.S. e-commerce sites. However, they account for over 40% of the revenue generated. Imagine the possibilities if only businesses spent a little more TLC on these repeat buyers, who come back to you right now of their own accord?

In its Annual Ecommerce Benchmark Study, MarketingSherpa set out to discover how much it costs to acquire a new customer. Over half of all respondents reported that their new customer acquisition costs had stayed steady across 2013, while a third of them felt acquisition costs were on the rise.

  • The median cost of acquiring new customers according to the survey ranged between $12 and $25. This is five times more than the cost of retaining an existing customer.

It gets better.

  • The probability of selling to an existing customer is 60-70% as against the measly 5-20% chance of selling to a new one.

Repeat customers are not just easier to sell to. They also spend more per transaction than a brand new customer.


How do we get them to buy again?

So we see that repeat customers are not just more receptive to your marketing overtures, they are also more profitable to cultivate. But how do you go about getting one-time buyers to stop looking elsewhere and come back to your business? Here’s how.

  1. Deliver

If you take away just one thing from this article, let it be this. DELIVER. Deliver on your brand promise. Live up to the expectations that you set up for yourself. Don’t let the customer down. A product or service that performs like it should is an advertisement for itself.

No one appreciates being taken for a ride. In our enthusiasm to sell our services, we are often guilty of being creative with the facts about our offerings. This is only a set up for sure failure. By overpromising to a potential customer, you are setting up yourself for a user who is dissatisfied and will never come back.

Instead, be honest in your marketing claims. And live up to each of the things that you promise your users. The Brand Keys Customer Loyalty Index for 2105 found that “the gap between what consumers expect and what brands deliver is driven almost entirely by emotional values.” The brands that scored the highest in customer loyalty were the ones that matched their customers’ expectations with their product and service delivery.

  1. Be Nice to your Customers

Your neighbor gets a smile and a ‘hello’ when you bump into them at the super market. Then why not your customers? Instill a company-wide culture of being nice to your customers, showing them gratitude for bringing their business to you instead of competition.

This begins with the simplest thigs. Every step of interaction that your user has with your business can be an opportunity to tell them how much you value them.

  • Set up triggered ‘Welcome’ emails that go out automatically to every new customer who buys from you.
  • Create a habit of sending out custom ‘Thank You’ emails to your customers after each of their purchases. This may seem like a cumbersome task but it matters in the long run.
  • Train your customer care representatives to be cheerful, positive and kind in all their customer interactions. It’s very difficult for people to say a ‘No’ to someone who’s going all out to be nice to you.

No one likes a grouch. At the same time, people love a smiling face and a peppy tone. By being genuinely nice to them, you put a smile on their face when they think of your brand. Nothing beats that!

  1. Wow them with Customer Service

Most people I know would rather go for a root canal than call up the customer care number for a brand they use. Since people have such low expectations from customer care to begin with, you don’t have to do much to wow your users. A simple gesture of support can up your customers’ satisfaction levels by significant amounts.

Good customer service is not just good manners. It’s based on scientific findings. Psychologist Robert Cialdini’s seminal book ‘Influence: The Psychology of Persuasion’ mentions the Principle of Reciprocity as a key factor that affects customer buying behavior. According to this theory, human beings are wired to reciprocate to an act of generosity or kindness with an action along the same lines.

When a brand goes out of its way to please its customers, the action does not go unnoticed. Customers keep the special treatment in mind and go back to the same brand over and over again.

Online shoe retailer Zappos is legendary for its customer care overtures. Take the case of the best man who was in a soup as his dress shoes weren’t to be delivered on time for the wedding. The Zappos representative made sure that a new pair of shoes were overnighted to him, he was upgraded to a free shipping VIP account for no extra charge and offered him a full refund on his purchase. Now there’s a customer they’ve bagged for life!

With that kind of customer service commitment, it’s no wonder that over 75% of Zappos’ revenues are attributed to repeat customers.


  1. Build a Subscription Model

What would you prefer? Walking down to the news stand every week to buy your favorite magazine or having it delivered to your doorstep? If a news app or website were out of the question, I would probably go for the delivery option. So would most of you, is my bet.

A tried and tested model for repeat purchases, the subscription model has recently seen a lot of demand from some very unlikely product categories. From mail-order razor service DollarShaveClub to unicorn startup shoe subscription site JustFab to healthy snack food subscription services like NatureBox the variety of categories is only limited by your imagination.

The subscription model tackles the out of sight, out of mind phenomenon by effectively removing the need to visit your store and buy a product on a repeated basis. With just one lump sum subscription fee, they lock in users for multiple repeat purchases.


  1. Give Out Future Use Coupons

Couponing is an industry in its own right today, with collective expenditure hitting $28 billion per year on digital platforms alone. Consumers saved $3.6 billion in 2014, thanks to discount coupons.

From these figures, we can surmise that there is a large and thriving market for coupons out there. So what about pushing the limits a little and offering users a future use coupon –one they can use not for the current purchase but for their next purchase. By tapping into the user’s bargain hunting instinct via a coupon, you are ensuring that she makes it a point to visit your store once again to redeem that future use coupon.


  1. Subsidized Upgrades

Intel, Microsoft and a host of other technology brands had product upgrades as a way of enticing repeat purchase wrapped up years ago. However, it is with the introduction of the iPhone that annual upgrades of a piece of tech that worked perfectly fine became a necessity and not a lifestyle choice.

After its launch in 2007, the iPhone offered existing users the option of upgrading to the latest version at a price that was lower than what a new user would pay, in return for a two year contract with the mobile carrier. The incentive of being among the few who owned the latest piece of snob-tech combined with the attractive discount on the upgrade made the new purchase not just painless, but actually aspirational. (That these subsidized upgrades may soon be history is another story altogether).

Take a cue from the most valuable brand in the world and offer users the option of an upgrade or a fresh purchase at a slightly lower price than new customers. The price incentive will not only appeal to their cost conscious sides, it will also offer them the feeling of exclusivity that comes with being part of a select privileged group.


  1. Refills and Accessories

When a customer buys a product from you, he offers you a wealth of information in return. You already know the lifespan of the product you’ve sold. You also know how the user is going to use the product. Now, with the user’s demographic and personal information, you can probably estimate when the user will run out of the product or when the product will become unusable.

Dig into these data reserves and plot the approximate refill / renewal period for each product you sell. Approach your customers with gentle reminders of how their product will soon be dying a natural death and offer them alternatives. This proactive approach beats out competition and gives you a clear playing field to present your latest product offerings.

Another easy repeat purchase strategy is figuring out appropriate accessories and accoutrements to your original sale and showing your customer the wondrous possibilities that lie in wait. With a little bit of proactiveness and a dash of creativity, your next sale is round the corner.


  1. Reminder Emails With Personalized Product Recommendations

Email marketing is a hidden gem in a marketer’s armory. From costing you close to nothing to send it out, the returns that email marketing is capable of offering is next to no other marketing tool. According to the DMA National Client Email Report 2015, for every $1 that you spend on email marketing, you get a return of $38.

Incorporate the power of emails into your customer retention strategy. Simple reminder emails that connect with your first-time customers on a regular basis maintains top of mind recall for your brand. Even better if those emails are personalized based on your users’ profile and past buying behavior.

Personalized Email for Repeat Buyers

Personalized Email

Image Source

By including items that are related to or complementary to items the customer has already bought, you increase your chances of conversions. Research confirms that personalized emails offer 6X higher transaction rates than non-personalized ones.

  1. Notifications for New Launches

When you launch a new product, service or even a new store, you don’t want to miss out on informing your existing customers. The fact that they reposed their faith in your business once, means they are open to working with you. Clinch that opening and keep them updated about any new events that you want to talk about. Not only does it keep your brand top of mind, it gives users a reason to visit your store, automatically increasing the chances of a new sale.

If you have a mobile app, invest in push notifications for keeping your users in the loop about new developments. Data shows that targeted push notifications offer a conversion rate of 54%.

No app? No worries. You can always fall back on good old email to do the trick. Is your event a fancy mega launch? Why not send out physical invites or announcements instead?


  1. Make it easy to buy again

Wanting one-time buyers to come back over and over again is every business owner’s dream. However, how many businesses actively try and make it easy for a user to buy again?

There’s a lot you can do to make repeat purchases easier. To begin with, pre-fill your users’ profile details – name, address, contact information etc. in your online checkout forms. If your site is secure enough, pre-filling their payment information from their last transaction is another step towards helping them along in their transaction. Amazon pioneered this attempt at making repeat purchases simpler through their 1-Click Ordering service.


Amazon 1-Click Ordering

Amazon 1-Click Ordering

While we’re on the topic, I’m eagerly awaiting the roll out of another Amazon innovation – the Dash button. The Amazon Dash button is an example of the internet of things, helping users buy groceries, household items and other regularly purchased items at the push of a button anywhere in their homes.

–Part 1 of 2–

Read Part 2 of 2

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