Two Simple Retention Strategies

Anybody else feel abandoned by many of the e-commerce sites that fought so hard to acquire customers over the past few years?

As a consumer, I rarely seem to get rewarded for being in that elite group of early adopters of e-commerce site sales. I see promotions that these sites run all over the web to attract new customers, and I find myself saying, “Hey, hook me up for being a loyal customer over the past few years. Why is it that only the new customers have all the fun?”

In an age in which a lot hinges on the overall size of a site’s customer base, one can see the motivators that might lead an e-commerce site to concentrate more heavily on new customer acquisition than a traditional business might. Still, I find it almost inexcusable that some sites appear to be betting the farm on new customer acquisition, especially since retention-based advertising is a relatively simple thing to implement.

If online advertising with banners is up your alley, there are two terrific ways to segment your ad campaigns into component groups of existing and potential new customers.

On the publishing side, media/technology companies such as Engage and DoubleClick have programs that make it easy to re-market to consumers. Engage’s Echo and DoubleClick’s Boomerang work essentially in the same fashion.

Pixel tags placed on your e-commerce site allow Engage and DoubleClick to recognize existing customers in future campaigns on the Engage Media and DoubleClick networks, respectively. Utilizing their ad servers, you can segment buys and serve different messages to new and existing customers.

This makes it possible to address new customers with your acquisition message and existing customers with your retention offer in the same campaign. Because these types of programs are executed on the publishing side, an advertiser can choose to purchase a specific number of ad views against either the acquisition or retention effort, provided that it has run a sizeable prior campaign with the pixel tags in place.

The concept can be ported over to an advertiser-side ad server as well. Most of the ad servers that can track back-end actions through pixel tagging can use the same method to recognize the people who have previously visited your site and serve different messages to them.

The important difference between this and the publishing-side method is that you won’t be able to purchase specific levels of media weight against existing customers. Once an advertising-side server is called, it has to serve an ad, regardless of whether the browser calling the ad belongs to someone you’ve formulated a relationship with or not.

Still, segmenting your buys in this fashion only makes sense. A seasoned customer is not going to respond to your offer of $10 off a first purchase if he made that first purchase two years ago. However, he might respond to an ad that thanks him for being a loyal customer and offers him free shipping on his next order.

Another approach, which is often more cost-effective if implemented properly, is utilizing email offers. Almost every e-commerce site worth its salt collects an email address upon registration. Smart e-commerce sites will place that email address into a database profile containing, among other things, purchase history. Segmentation by purchase history can be as simple as a database query and can allow your site to do things like:

  • Thanking your regular customers — “Hey, Mr. X. Thanks for ordering a box of Krispy Kreme donuts from us every week. Since you’ve been such a great customer, we’re going to throw in a free six-pack of LOCO Soda with your next purchase.”

  • Snaring those customers that have dropped off the face of the planet — “Hey, Ms. Y. We noticed that you haven’t ordered anything from us in the past nine months. We’ll be happy to offer you $10 off your next purchase if you visit our customer feedback form and tell us why.”
  • Cross-selling and upselling — “Dear Mr. Z, Thanks for purchasing a copy of Barry Manilow’s Greatest Hits Vol. 1. Did you know that we’ve recently opened a new bookstore on the site? We’ll give you a free copy of Manilow’s autobiography with the next CD purchase you make.”

The e-commerce sites putting emphasis on retention are the smart ones. When you think of how tough it is to target users online who are interested in your products and comfortable purchasing online, it only makes sense to mine your existing customer base to incentivize them to do more business with you. These people represent low-hanging fruit for most e-commerce sites.

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