If you want your ecommerce business to be successful, you need to focus on retention.

Too many businesses put all their effort into acquiring new customers, without putting any thought into keeping the ones they have. The truth is, retaining customers is much more important than acquiring new ones. In this blog post, we will discuss some of the key factors that influence customer retention and provide tips for improving your retention rate which will have a direct impact on revenue.



One of the most important factors influencing customer retention is how well you understand your customer journey.

You need to find out when and where are your customers most likely to drop off and take steps to prevent that from happening. Maybe you are not attracting the right type of customer, so focusing on attracting qualified leads is in order. Or maybe your content is not enticing enough, so some research is the next step not to mention some changes to your copywriting.

Maybe your user experience is not very friendly and your system is creating barriers that prevent checkout. There are many factors that can influence customer retention, and it’s important to analyze them all if you want to improve your retention rate.

Retention is contingent and always aligned with another concept you are likely very familiar with: Customer Satisfaction. This is a critical aspect to consider and retention is the way to measure it. Customers are more likely to depart if they are dissatisfied with your goods or service so first things first, make sure what you are selling provides value and solves a need, no amount of tweaking customer journeys will help you if you don't take this into account.

HubSpot reports are a great way to map your customer lifecycle, learn more in our blog. 

So how do you increase customer satisfaction?

You can start by providing engaging content, making it easy for customers to find what they are looking for on your website and optimizing the user experience. Also make sure you are available when they need you, offer great customer service and respond promptly to inquiries. Retention is never ending flywheel with lots of moving parts that must be kept in check. Let's dive into some of them.

Tip: Tools like Dynamic Coupons, which send single use personalized offers can be a great first step towards increasing retention and measuring satisfaction. 


How do I know if I am attracting the right customers? It's all about retention.

The answer is likely hidden in your customer data, this is the time to look into how much traffic are you getting and from which source and analyze your conversion rate. This tells you how many people become customers or buy at least once. This gives you a first glimpse into qualified traffic, a conversion rate of anywhere between 3% to 10% is actually really good since the traffic you are analyzing is TOF (top of the funnel). Then, compare it to average lifetime value of this customers and actual retention rate which could be average number of purchases being greater than 3 for instance.


Let's convert it into a 3-step process:




  1. Source analysis: Which source is attracting more traffic? If the difference between sources is more than 4% you should run test with those that have the least percentage to attempt to increase it. If all of them are the same, pick one and run tests to see if it can be increased as well.

  2. Customer-product analysis: If you have a CRM you can likely analyze your customers per source and discover things like which products do they buy more of. Maybe a specific source is bringing customers that buy your premium products, that would be considered a highly profitable source and one deserving of more acquisition investment. On the other hand, maybe a source with a high conversion rate bring in clients that purchase your cheapest product, a cross-selling outbound strategy might be in order there.

  3. Customer Cultivation: Segmenting is key to understanding your customer and their lifecycle. How many purchases must happen before you are their top of mind? How much must they spend before they feel loyalty to your brand? Insights likely hidden in your customer data and only waiting to be mined. Segmenting will also help you understand if some loyal customers are drifting or at churn risk so you can deploy strategies to re-activate them.


The Customer Cultivation Framework


There is no one-size-fits-all retention strategy. Each business is different and requires a unique approach to keeping customers coming back for more.

This circles back to what we call the Customer Cultivation Framework, a personalized analysis designed to help you understand your customer segments and take data-driven action to increase attraction, improve nurturing efforts and maintain as well as increase retention rate.

Data is our engine as we analyze your customers unique behavior and segment them accordingly providing you with actionable insights and tools to take action like Dynamic Coupons, Dynamic Segments and Data Integrations, not to mention a Buyer Behavior in Depth Analysis of your store.

This is all to say that we take an analytical and scientific approach to understanding your customer. We start with who they are, what they do on your site, how likely they are to purchase and then create tailored experiences for them.

The result is a higher retention rate, more engaged customers and a better bottom-line for you.

To get started on this journey ask for our Free Customer Segmentation report today!