ECommerce loyalty: Putting the right ingredients together for growth

Customer loyalty has been a key factor in today’s retail business. With a good segmentation and customer lifecycle strategy, it influences where customers shop, what they buy, and how much they spend. But customer loyalty in e-commerce is complex as the brand interaction is different, hence, marketers need to continuously nurture and delight customers to stay ahead of the competition.

The motivation to build e-commerce loyalty is linked to the sales increase. Ultimately brands with the right technical framework, CRM and loyalty strategy will be successful in the race towards sustainable growth. This article offers several actionable strategies for e-commerce loyalty marketing.

1. Develop a rewarding customer loyalty programme

There are many different loyalty programs in e-commerce, but the most commonly used are loyalty points, member tiers, or a mix of both. In a point-based loyalty programme, brands should consider rewarding not only for purchases but also behaviours when customers leave reviews, share their discount code on various platforms and invite friends to join memberships to earn bonus points.

In a recent loyalty marketing report, marketers surveyed have indicated that they prefer using the a number of marketing tactics, such as vouchers (percent discounts, cash values, promotions); gifts (food and beverages, fashion and accessories, toys and gadgets); experience-related activities (hotel or travel, leisure activities, workshops, cultural experiences, premium access and luxury experiences); and VIP/point schemes (mileage points, loyalty schemes and membership clubs). 

2. Offer exclusive rewards and perks to stimulate buying behaviours 

Reward customers with exciting perks like discount codes or free shipping vouchers that they can use with their points earned. Loyalty points for rewards such as:

These tactics are great for stimulating repeat purchases and increasing the average order value for customers. However, using them too often will take away the excitement and condition shoppers to buy only when there are perks. So, weigh the pros and cons when you plan your loyalty mechanics. 


3. Design customer journey with marketing automation

To design a loyalty programme that encourages engagement and build meaningful connections with the brand, you’ll need the right tool to design the customer journey for different target segments (ie. first-time buyer, actively buying member and churning customers); automate marketing communications and use the data insights to refine your loyalty strategy. With the right loyalty platform, you’ll also have the tools to provide customised rewards, incentivise shopper interactions, analyse detailed CRM metrics, and more.

4. Use data to improve your e-commerce performance 

A key part of optimising your online store is to measure the success for sales conversion. With loyalty marketing in e-commerce, marketers can gather more data from customer engagements and use those data insights to enhance marketing strategies. Apart from the usual e-commerce metrics (for example, the conversion rate of visitors, engagement of email subscribers, cart abandonment rate); consider loyalty metrics like customers making the first purchase within the first few days after signing up, or percentage increase in revenue per customer and increase in lifetime value, to drive business decisions and adjust loyalty propositions for long term success.

5. Offer personalised content and experiences

Brands that focus on providing personalised experiences will perform better in repeat sales. Customers see that the brand is relevant to their needs and tend to pay more attention to the offers and products recommended to them. Indeed, studies have shown customers are willing to pay a premium when offered personalised services. For millennials, they are also more willing to trade personal information like interests and likes to receive personalised content in return.

Brand should offer product recommendations based on customers' profile, preferences, purchase history, campaign data (open email, click links, download coupons). Use this information to send them free samples, exclusive perks, invitations and content (for example, blog posts or videos) to show that you care and value their loyalty.


6. Provide seamless customer service support 

Consumers are constantly multitasking with devices turned on at all times. By offering different channels for customers to get in touch with your brand, you’ve made it simple for them to share feedback, comments, queries or contact customer service for support. Whether you provide an email address, a phone number, a chat or social media as customer service touchpoints, the faster and more convenient they can get answers to their requests, the better the brand experience they’ll have; and that builds loyalty.

According to Statista's report, retail e-commerce sales in 2020 worldwide have reached US$4.3 trillion and is expected to grow to US$6.4 trillion by 2024. The e-commerce industry will continue to see new players, products, technology and marketing strategies that push the boundaries of online innovation. Brands that are successful at building a stronger relationship with their customers will ultimately emerge as winners in the race towards e-commerce profitability with a large base of loyal customers.

This article is contributed by XGATE.