Curious to know how some e-commerce brands manage to get repeat orders for years and some other brands struggle to do so?

Let’s face it:

Brand loyalty is dying.

And that’s bad news.

If you don’t have customers who are loyal to your brand, you’re trapped in a cycle of costly customer acquisition and retention. Working with marketing experts for ecommerce is the only option to break the vicious circle by following the loyalty building strategies that are proven to work in this competitive world.

Think about this:

Did you know that it costs seven times more to acquire a new customer compared to retaining an existing one? But most online stores only spend 19% of their marketing budget on retention.

That’s money down the drain.

What you’ll learn

• How difficult it is to build brand loyalty these days
• The real price of paying no attention to customer retention
• How to build long-lasting emotional relationships
• Creating engaging and effective loyalty programs
• Converting customers into brand ambassadors

Brand loyalty: Is it difficult to build it these days?

The retail game has changed.

Customers now have many brands to choose from, not just your local competitor with its similar offering. There are now 4.1 million Shopify stores currently active on the web, and shopping around is a few taps away.

Here is what is happening now:

Customers are spoilt for choice like never before. A new ad, a new promotion, a new product show up on their feeds every day.

And customers are not shy of changing brands.

45% of consumers changed their usual brands over to other options because they were frustrated by their customer service in 2024. This has increased from 42% of customers from the previous year.

In other words, it keeps on getting more competitive.

How costly is the act of paying no attention to customer retention?

Allow me to put the numbers in perspective for you.

Loyal customers are not a luxury you get to have as an e-commerce retailer.

They are a must-have to survive. Why?

The data:

Loyal customers buy five times more than a first-time buyer. Furthermore, even with loyal customers only making up 8% of your web traffic, they account for 41% of total revenue.

That is insane multiplier!

But here is the real shocker:

Executives believe that only 32% of retention is worth focusing on at all. They would rather waste money on acquiring new customers than pay attention to why their acquisition costs only increase.

But smart brands that focus on retention are seeing anywhere from 25% to 95% profit increases from just a 5% increase in retention.

Which side are you on?

Building meaningful and long-lasting emotional relationships

Do not compete over prices.

The secret to brand loyalty? Emotional connection.

Customers that are emotionally attached to a brand have a 306% higher lifetime value and are 71% more likely to advocate.

How do you make your customers love you?

Get them to start by understanding their customers:

• 63% of consumers only like brands that share the same values
• 30% of buyers are motivated by ethical values
• 60% consider a brand’s sustainability important

Consumers want authenticity. Not just a simple “buy this product; we support green energy” disclaimer.

This is how to be authentic:

• Be clear on your beliefs.
• Apply them to every decision you make and every offer you make.
• Make them part of your brand’s reason for being.

Your customers can sniff out a fraud from a mile away.

Creating Loyalty Programs That Work Wonders

Loyalty programs? Check.

Cashback programs? Check.

Discount deals? Check.

Guess what? These are everywhere.

Why is that?

The majority of them suck.

You know why? Because they are boring. They are complicated. Or they take too long before a customer can redeem the value in it.

An average American person has a membership in 16.7 loyalty programs. But an average user only uses 8 out of the 16 programs actively.

Here is what differentiates the successful loyalty programs from the losers:

Loyalty programs that offer value immediately will win.

Loyalty programs that make customers jump through hoops will lose.

Numbers don’t lie:

• 85% of consumers are more likely to keep shopping when a store has a loyalty program
• 73% of them spend in a way to get the most value
• Those members that redeem their reward purchases 3.1 times more every year.

Loyalty programs that work best are those that can increase revenue by 15% to 25% per year.

Give customers choices. Make it exciting. Make it fun. Reward them fast.

Personalisation: Your biggest secret is now out

Generic marketing messages are a thing of the past.

The consumers you are selling to expect you to know them now. They expect you to understand what they like. They also expect you to see them as an individual and not a customer number.

The statistics show:

74% of e-commerce retailers are increasing their personalization efforts. When given personalized rewards and gifts, customers spend 4.3 times more annually.

Personalization goes beyond just inserting their first name at the top of an email.

It includes:

• Making product recommendations from their purchase history
• Sending relevant offers in time
• Giving them exclusive experiences when they are top customers
• Remembering their preferences across the web.

Smaller businesses are reaping major benefits.

Businesses with less than 500 monthly orders increased their average order value by 20.58%.

Smaller brands can always pivot faster. They can be more personal than giant corporations.

Mobile Apps: Your Hidden Treasure

Want to know a secret loyalty hack?

Create a mobile app.

42% of loyal customers installed the app of their favorite brand, and 60% of mobile users are incentivized to stay loyal by way of exclusive deals only they get through apps.

Apps create a direct line to your customers.

A line with no algorithm changes. With no rising ad costs. You have direct access whenever you want it.

That is loyalty at its easiest.

Turning customers into loyal brand advocates

This is where it gets juicy…

Your top customers don’t just buy from you. They also sell for you.

More than half are actively promoting their favorite brands to other people they know. And 14% of all customers publicly defend their companies on social media channels.

Talk about free marketing.

Customers are your biggest assets, but you need to win their hearts.

How do you win their hearts?

Exceed their expectations at every point of contact:

• 93% of customers continue to make repeat purchases from a business that has great service
• 89% of people prefer a brand with the same values as theirs
• 82% of customers surveyed said good customer service is the most important factor when it comes to loyalty.

It’s no longer about who has the cheapest prices. It is about having the best experience.

Retention Marketing that is Effective

Stop treating all your customers equally.

The top 5% of all your customers are bringing in 35% of all the revenues. They should be treated differently from other customers.

Create customer tiers. Give them exclusivity. Make them feel special.

This can include:

• Early access to new product launches
• VIP-only pricing deals
• Special invitations for an exclusive event or experience
• Dedicated customer service

Customer acquisition cost has increased by 50% in the last five years.

Customers you retain are customers you won’t have to replace.

The future of Loyalty

The rules of the game for consumer loyalty are rapidly changing.

Paid loyalty programs are gaining traction: 70% of consumers now pay for at least one membership, a 32% year-over-year growth.

The winners will be the brands that use technology with a human touch.

Conclusion

Loyal customers are no longer a luxury your brand can do without.

In the current environment of ever-increasing acquisition costs and mounting competition, your growth is directly tied to your retention efforts.

The good news? You don’t have to do everything at once.

Pick a strategy and give it a shot. Once you’ve perfected it, move on to another strategy and incorporate that into your marketing mix.

Focus on giving your customers real value.

Build emotional relationships with your customers. Make the customer experience memorable and they will come back to you time and time again.

At the end of the day, loyalty is not bought.

It’s earned, one superior experience at a time.