8 Uncommon Strategies for eCommerce Brands to Multiply Shopper LTV

01/27/2016 11:13 am ET Updated Jan 26, 2017

Earlier this year, RJMetrics published its 2015 eCommerce Buyer Behavior Report in which it revealed, "The fastest growing ecommerce companies have a customer lifetime value 79% higher than their peers." The study, which analyzed data from 176 eCommerce retailers and 18 million customers, proclaimed customer lifetime value (LTV) to be the most important metric businesses need to know and improve in order to succeed. To grow that number though, brands must do two things:

  1. Drive repeat purchases
  2. Increase average order values

Unfortunately, the report also found, "Only 32% of customers place a second order in their first year as a customer." Although digital retailers are reliant on repeat purchases, many fail to actually bring shoppers back to complete follow-up orders. To retain customers and extract more value from buyer-retailer relationships, here are eight oddball strategies eCommerce companies can use to multiply shopper LTV.

Celebrate quirky holidays

For the 2015 holiday season, Forrester Research predicts online sales will grow three times faster than in-store sales. In total, eCommerce brands will earn $95.5 billion this November and December. And with so much money at stake, the competition is fierce.

Sadly, that means smaller businesses take a backseat while the Apples, Best Buys and Walmarts get the lion's share of holiday shoppers' budgets. In a blog post for Hootsuite, Olsy Sorokina writes, "Holiday campaigns are a great opportunity to connect with your customers, think outside the box, and use a more casual tone in your messaging while still remaining on-brand. Here's the catch: during most major holidays, such as Christmas or Halloween, your brand's campaign will be competing against hundreds of others, possibly with bigger teams and budgets at their disposal." While niche brands can still capitalize on sales during major shopping seasons, they have a better chance of standing out when they celebrate weird and wacky holidays their customers love too. Five examples of lesser known holidays include:

  • Bubble bath day
  • Ice cream soda day
  • National dog day
  • Tap dance day
  • Umbrella day

Help realize customers' dreams

Your customers have big ambitions and they'll be forever loyal to you if you help them realize some of their wildest dreams. In 2013, Dollar Shave Club decided to celebrate its members by sponsoring things they loved. The "DSC Sponsors Your Thing" campaign became an instant hit. Each month, the company received 100 to 200 submissions from customers and DSC sponsored two. From the program, DSC endorsed cool projects like pretzel moustaches. To customers, DSC had demonstrated its commitment to supporting its community. In return, fans grew even more loyal of the quirky men's grooming brand.

On a macro level, Kickstarter has built a platform to enable thousands of creative projects to come to life each month. In 2014, 3.3 million people pledged $529 million to finance 22,252 cool and innovative ideas. But while those campaigns got funded, many more were left unfulfilled due to lack of resources. That means brands have an opportunity to offer their support their customers' dreams -- big or small.

Make receipts memorable

Earlier this year, Receiptful conducted a study that sought to measure the ROI of email receipts. After analyzing 2 million digital order confirmations across 9,000 eCommerce stores, we found that email receipts had an impressive 62% open rate and a 13% click through rate (CTR). Comparatively, regular marketing emails averaged a 17% open rate and a 2% CTR. We also found that the average digital receipt generated $0.81 in revenue for our brands while all other marketing emails only earned companies $0.08 each.

For eCommerce businesses that have 10,000 customers who average three orders every year, that's 30,000 missed marketing opportunities when brands fail to include coupons, surveys, FAQs, and upsells in their email receipts.

Permit multiple returns

Many eCommerce brands view offering a generous return policy as a double-edged sword. Without them, companies deter new customers from completing their first purchase. With them, stories expense money and time receiving, repackaging and refunding returned inventory. For RueLaLa, returns cost the company $5 million in 2012. But for other eCommerce businesses, returns can be an opportunity to improve a customer's shopping experience.

Generally, stores limit how much and how often customers can return product to avoid having shoppers abuse their return policy. Of course, businesses don't always get it right the first, second or third time around. Despite their outrage, consumers have a fairly high tolerance for bad online shopping experiences. The only deal breaker is when they can't return product they don't want and are stuck with a purchase they will always regret. So when brands fail their customers, they should seek out ways to make things right instead of projecting blame and insisting the customer is a bad fit for their business. This way, stores minimize customer churn and they successfully earn shoppers' loyalty.

Prioritize packaging

"For ecommerce businesses, the shipped package represents the most direct touch point and connection with the customer, it also happens to be one of the most under-utilized marketing opportunities for merchants," says Shopify's Richard Lazazzera.

Many eCommerce businesses are successful at engaging audiences with flawless product shots and positive customer reviews on their website but underwhelm shoppers when they deliver packages with subpar design and wrapping. That said, brands that do manage to "wow" buyers throughout the unboxing experience are more likely to drive repeat purchases. According to Dotcom Distribution, "The 2013 eCommerce Packaging Survey results show strong opportunities for customer loyalty development, with 52% of consumers likely to make repeat purchases from an e-retailer that delivers orders in premium packaging."

To develop quality branded packaging, Lazazzera lists the 10 most important elements to focus on:

  1. Box
  2. Tissue paper
  3. Filler
  4. Sticker
  5. Promotional material
  6. Receipt
  7. Customer note
  8. Tape
  9. Surprise gifts
  10. Product samples

Send an off-brand gift

Zappos is regularly heralded for setting the gold standard in customer service. Unlike most brands, its customer service team has gone out of its way many times to "wow" shoppers with off-brand gifts, demonstrating the human side of the organization.

When Zaz Lamarr expressed interest in sending back a pair of shoes, Zappos welcomed the return with open arms. But when the footwear retailer never received the return shipment, they reached back out to Lamarr. She replied that her mother just passed away and that she hadn't had the time to coordinate the return. To make her life easier, Zappos arranged a UPS pick-up at her home and sent Lamarr flowers for her loss. In a blog post, Lamarr wrote, "Yesterday, when I came home from town, a florist delivery man was just leaving. It was a beautiful arrangement in a basket with white lilies and roses and carnations. Big and lush and fragrant. I opened the card, and it was from Zappos. I burst into tears. I'm a sucker for kindness, and if that isn't one of the nicest things I've ever had happen to me, I don't know what is."

For brands, the moral of the story is: Companies are powered by people too; send thoughtful gifts to your customers whenever there's a chance to put a smile on their face. To deliver the best gifts, social media expert Mike Bal recommends, "Send fans something they didn't know they wanted." Rather than pawning your own products off to customers, give them something valuable yet unexpected. Bal explains, "If your fans take an interest in what you're talking about and what you care about, it's only fair for you to do the same. Take a look at their social accounts to see what kinds of things they really enjoy, and then send them something you know they'll love."

Slow down the sales cycle

Overzealous brands push customers to complete a new purchase every day. Even with extensive credit lines, shoppers are still limited by budget and need. The fact is: No one can afford to or is interested in shopping at your store all the time.

Often, aggressive sales strategies create short-term wins for brands at the expense of long-term gains. When a customer spends $500 on a single order of gourmet popcorn (or $100 per order each day for five days straight), they'll get sick of it pretty quickly and may never want popcorn ever again. Instead, if they were to purchase $30 worth of popcorn each month for two years, they'd spend $720 without losing their appetite for the product. Counterintuitively, brands may increase customer lifetime value when they encourage shoppers to pace themselves.

To be successful, eCommerce companies must slow down their sales cycle. Instead of constantly sending customers marketing messages with a "Buy Now" call-to-action, they should engage shoppers with interesting stories about their product or industry. When customers are ready to purchase again (in a few weeks or after one to two months), then you may send them a prompt to revisit your store and complete their next order.

Use multi-channel customer service

Your customers are active on Facebook, Twitter, email, and SMS. When they have an issue or concern, they reach out using the medium they are most familiar with. But when your brand is absent from the conversation, shoppers turn to your competitors.

A 2013 poll by Harris Interactive, found:

  • "56% of those polled would be at least somewhat likely to switch to another brand or company if this new brand or company offered more options to connect with them."
  • "86% of respondents expect brands to offer multiple options and flexible timing to interact with customer service, with 82% agreeing that the ability to contact the company via a variety of methods increases brand satisfaction."
  • "According to 68% of those polled, companies and brands need to find ways to offer more customized interactions, such as sending texts about low balances, to increase their satisfaction."

To increase customer LTV, brands need to invest in channels where their customers live and to take a proactive approach to customer service. By routinely sending fans, followers and shoppers fun posts and thank you messages through different mediums, eCommerce companies have the opportunity to showcase their personality and demonstrate their commitment to a positive customer experience. Offline, online retailers can even host meetups and office hours or send customers cool postcards and handwritten notes. Doing so improves brand sentiment, which may also lead to fewer returns and more repeat purchases.

What are some uncommon ways your brand engages shoppers to improve customer loyalty and drive repeat purchases?

This post originally appeared on Receiptful's eCommerce Success Academy and is republished with permission.

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Danny Wong is the co-founder of Blank Label, an award-winning luxury menswear company. He also leads marketing for Receiptful, a platform to supercharge all customer interactions for eCommerce stores, and Tenfold, a seamless click-to-dial solution for high-performance sales teams. To connect, tweet him @dannywong1190 or message him on LinkedIn. For more of his clips, visit his portfolio.