Lesson 2: Turn 1-Time Buyers into Loyal Customers
Repeat buyers deliver the same revenue as five new customers combined and are nine times more likely to convert.
Repeat buyers make up just 8% of visitors, but deliver a whopping 40% of revenue—making them a lucrative segment of customers. Unfortunately, long-term, profitable customer relationships don’t happen overnight. By investing in customer retention from the start, you can dramatically grow your bottom line while transforming one-time buyers into committed brand enthusiasts.
In this lesson, you’ll learn:
A framework for turning one-time buyers into loyal customers
Nothing feels as good as earning a new customer. In that moment, you feel validated: Your marketing efforts have finally paid off! Time to celebrate, right?
Well, not exactly.
Long-term, profitable customer relationships don’t happen overnight, which is why it’s important to continue nurturing the relationship after the initial win.
Unfortunately, marketers tend to focus too heavily on acquisition—a costly mistake. With acquisition costing six to seven times more than retention, the only path to sustainable growth is a commitment to keeping your customers around. Still not convinced?
After analyzing 33 billion visits to 180 eCommerce websites in 2012, Adobe discovered a compelling reason to invest in customer retention: Returning customers are far more profitable than newly acquired customers. More specifically, they found:
- That repeat customers deliver 40% of revenue, despite making up just 8% of visitors
- That one return customer delivers the same revenue as five new customers, on average
- That customers spend three times the original purchase amount when making a second purchase, and that this number only continues to increase over time
Investing in customer retention is clearly a worthwhile endeavor. But once you’ve decided to make the investment, what concrete actions can you take to turn one-time buyers into repeat buyers?
Here at Autopilot, we find it helpful to break complex tasks into manageable steps, which is why we’ve developed this simple framework:
Next, we’ll dig into each individual strategy or tactic—providing you with actionable steps and clear examples for turning one-time buyers into loyal customers.
How to turn one-time buyers into repeat buyers
Taking new customers from their first purchase to their second can be a hurdle. But with each additional purchase, you can be more and more confident that your customer is here to stay. In fact, customers who have made two purchases in the past are nine times more likely to convert than new shoppers.
In this section, you’ll learn how to inspire your customer to develop a purchasing habit. To accomplish this goal, you must help your customers integrate your brand into their daily routines.
Below you’ll find six strategies and tactics for transforming one-time buyers into repeat buyers:
1. Include data-driven recommendations in transactional emails
Transactional emails are triggered by a specific action, like completing a purchase, registering for an event, or signing up for a free trial.
In this case, we’re recommending that you include data-driven product recommendations in the email you send to confirm a customer’s order.
Say your customer ordered a pair of earrings. By including three top-selling pairs of earrings at the bottom of their order confirmation, you nudge them to make another purchase right away.
If you’re already up and running with Autopilot, follow these steps to pull it off:
Step 1. Create a custom field that captures the product category for every purchase your customers make.
Step 2. Add a check field condition to your eCommerce onboarding journey—after your trigger, but before your message. You’ll need to do this for each product category.
Step 3. Send an order confirmation email that highlights top-selling products belonging to the same category as the item that was purchased.
Notice how each product category has its own designated path. For example, if the customer bought earrings, the journey would cycle through these steps:
For inspiration, check out this email from Huckberry. The top half of the email looks like any other order confirmation email, but the bottom half of the email curates “trending gear”—jackets, watches, shoes, shorts, and even a hammock:
This section of the email sparks the customer’s interest in other products—increasing the likelihood that they’ll make another purchase right away.
2. Send timely reminders to customers to make a purchase
It’s easy to sell a product to someone who’s already planning to make a purchase, which is why timely reminders are so effective. Here are two examples of compelling reminder emails:
1. Product Replenishment Emails
Many products require replenishment after a certain amount of time has passed. For example, because unhealthy bacteria starts to grow on personal hygiene and makeup products after about three months, doctors recommend regularly replacing these items.
But most people lead hectic lives, which is why they don’t always remember when it’s time to buy a new toothbrush or tube of mascara.
As a marketer, you’re uniquely positioned to use transactional data to anticipate the needs of your customers. You can set up automated customer journeys solely focused on reminding customers that it’s time for a refill. Remember, these are items people need—making it an easy sell.
In the email, explain why it’s important to act now and enable customers to buy with a single click. By reducing customer effort, you improve your chances of becoming their supplier of choice.
2. Abandoned Cart Emails
People often get interrupted in the midst of making an online purchase. In fact, many people abandon their carts simply because they began searching for their credit cards and got distracted along the way.
For this reason, a short and sweet reminder to finalize an interrupted purchase can be effective. More often than not, these reminders are welcomed by the customer—who sees the communication as a value-added service.
Curious what an abandoned cart follow-up email looks like? Check out this example:
3. Use retargeting to keep your brand top-of-mind
When encouraging customers to form a purchasing habit, it’s important to keep your brand top of mind. Because retargeting ads follow your website visitors wherever they go online, retargeting is an effective way to achieve this goal.
If you’re using Google, getting set up takes just four steps:
- Choose between display network and search network campaigns
- Add Google’s remarketing tag to your app or website.
- Create lists based on rules you specify (these templates make it easy)
- Set up your campaign
One advantage of Google is that you can design custom parameters for your lists.
Retargeting is also helpful in combating browse abandonment, as it allows you to show ads containing specific products to people who previously looked at those products. In essence, this helps keep both the product and your brand top of mind.
Whereas Google remarketing “allows you to show ads to people who have previously visited your website or used your mobile app”, Google dynamic remarketing “takes this a step further, letting you show previous visitors ads that contain products and services they viewed on your site.”
Want to learn more? Check out Flight School lesson: Boost Low-Cost Acquisition with Ad Retargeting.
4. Encourage upsell and cross-sell with personalized product recommendations
Once you’ve collected more data about your customers, you can start targeting them with more personalized product suggestions. Basing these recommendations on their purchase history will increase your chance of making the sale.
Product recommendation emails differ from transactional emails in that they’re sent proactively. That is, instead of waiting for the customer to browse your website, you nudge customers to buy by sending a carefully curated selection of products straight to their inboxes.
Say a women’s clothing store wants to get their new arrivals in front of customers. They could use smart segments to send tailored emails to two to three groups of customers based on product category or perhaps brand preference (via custom fields). In doing so, they’d provide each customer with a relevant offer while increasing the likelihood of making sales.
Want a real-life example? A few months ago, I purchased a book called “The Filmmaker’s Handbook: A Comprehensive Guide for the Digital Age” from Chapters, a Canadian bookstore chain. A few weeks later, I received these recommendations in an email:
Had I continued to explore my interest in film, there’s a good chance I would have at least clicked on (if not purchased) these product recommendations.
5. Use loyalty points to gamify the process of building a purchasing habit
Before offering financial incentives, like discounts and coupon codes, try using gamification to encourage habitual buying.
For many customers, the ability to earn points on their purchases, which can later be redeemed for goods or services (whether that’s free shipping, discounts, or swag), is enough of an incentive to encourage the customer to make a second, third, and fourth purchase.
One to three days after the customer’s first purchase, send them an email welcoming them to your loyalty program. In the email, include the following:
- How your loyalty program works
- How many points they’ve earned thus far
- How many points they need to qualifying for a reward
- Sample rewards (with corresponding points levels)
- How to earn more points
When designing your loyalty program, remember to keep things simple. If you overcomplicate the process for redeeming points, your customers will quickly lose interest. Tie points either to dollars spent or number of purchases made, and always use even numbers (e.g., 100 points = $1 credit as opposed to 63 points = $1 credit).
6. Offer customers compelling incentives to make their next purchase
Once you’ve exhausted all other options, it’s time to incentivize customers to make their next purchase with a discount or coupon code. Keep these best practices in mind as you go forward:
Incentives should gradually escalate over time. For example, one to two weeks after the initial transaction, offer a modest discount of 5-10%. If the customer fails to bite, follow up with a 15% discount. If that fails to intrigue the customer, consider offering a 25% discount.
Know when to stop. If a 25% discount doesn’t persuade the customer to make a purchase, chances are that increasing that number won’t change things. Perhaps it’s simply not a good time. Either way, nothing’s stopping you from continuing to offer an incentive (e.g., 25%) after you’ve reached your maximum. Decide in advance what number makes sense for your business (based on how much wiggle room you’ve built into your pricing) and stick with it.
This email is one of our favorites:
It’s designed with one goal in mind: Driving one-time buyers to form a purchasing habit. By offering 15% off on two subsequent purchases, Jet helps customers get acquainted with its website, products, and processes, which helps reduce the customer’s learning curve—a strong step toward developing a purchasing habit.
How to turn repeat buyers into loyal customers
Many people wrongly assume that repeat buyers are loyal customers. In reality, loyalty has very little to do with your customer’s purchasing behavior. It’s more about creating a connection between your brand and your customer.
In this section, you’ll learn how to enhance your customer’s commitment to your brand. To accomplish this goal, you must develop brand affinity between you and your customers.
Below you’ll find four strategies and tactics for transforming repeat buyers into loyal customers:
1. Reward customers for desired behaviors
One sure-fire way to build customer loyalty is to reward customers for engaging in behaviors that help grow your business. For example:
- making a purchase
- following your brand on social media
- sharing product pages with friends and family
- publishing product reviews
- spreading positive word of mouth online
Because these behaviors benefit your business, you can afford to reward your customers for engaging in them. Suitable rewards include company gear or swag, loyalty points, discounts and coupon codes, and other perks.
The Hustle is one example of a company that uses this technique. Their ambassador program rewards subscribers for engaging in one important behavior: referrals.
For an early-stage business that relies on sponsorship revenue, increasing their subscriber list is a clear win. After all, the more subscribers they attract, the more money they can charge.
Here are three more emails we love:
1. “Earn travel credit for your next adventure” by Airbnb
The behavior? Refer your friends
The reward? Travel credit worth $30 for you and the same for your friends
2. “Free socks are not a myth” by Bombas
The behavior? Refer a friend
The reward? Free pair of socks valued at $11 for you and discounted socks for your friend
3. “Two razors for your friends (on us)” by Harry’s
The behavior? Refer two friends
The reward? Two free razors for your friends
2. Identify and celebrate your promoters
Building loyalty in customers who’re already brand enthusiasts is another easy win. The Net Promoter System® can help you identify these customers, who’re referred to as your “promoters”. They’re the ones who respond to the question “How likely are you to refer [company] to a friend?” with a 9 or higher.
Once you’ve identified these customers, the key is to celebrate them. Here are three ways to pull it off:
1. Create case studies
One powerful way to celebrate your promoters is to create case studies.
Case studies give your promoters an opportunity to share how they achieved success with your product and/or service. In making their achievements public, they enhance their reputations, while you gain social proof and bottom-of-the-funnel content that can be turned into blog posts, webinars, live events, and more.
2. Celebrate their achievements
By taking a community-centric approach to your marketing, you can—quite literally—celebrate your promoters.
For example, a quick shout-out on social media recognizing your promoter’s achievements (e.g., reaching 1,000 customers or some other milestone) takes just minutes to compose, but helps build long-term, committed customer relationships. Plus, there’s a good chance they’ll reciprocate!
3. Invite them to exclusive beta tests
Strengthen your relationships with your promoters by inviting them to test new products in beta—before other customers are given access.
Promoters tend to be power users, making them an ideal choice for beta testing. Plus, if you listen actively and respond to their feedback in a timely manner, you’ll continue to earn their respect and their loyalty.
Celebrate your promoters by creating case studies, highlighting achievements, and giving early access to products
3. Recognize big and frequent spenders with exclusive perks
Another way to build customer loyalty is to give special recognition to your VIPs. Because these customers buy often and tend to spend more money, you can afford to offer them exclusive perks that aren’t available to other customers.
Here are a few ideas to spark your creativity:
- an additional discount on already discounted items
- an invitation to exclusive events hosted by your brand
- an opportunity to purchase new products hours or days before they’re released to the general public
Don’t forget: In addition to offering VIPs perks, you’ll also want to acknowledge their status and thank them for their business.
Use smart segments to identify VIPs based on the criteria you specify (e.g., customers who spend over $1,000 per year). Then, automatically add your VIPs to a journey using the smart segment trigger and send messages intended for their eyes only.
4. Use customer care emails to build brand affinity
Customer care emails are an effective and free way to build good will. Here are a few ideas to stimulate your imagination:
- Celebrate customer milestones. Has your customer crossed an activity milestone? Have they spent a certain amount of money? Have they been a repeat buyer for a certain period of time? These are all occasions you should celebrate.
- Wish customers a happy birthday. There’s only one day per year when your customer is the center of attention, and it’s a fantastic opportunity for your brand to stand out. Recognizing moments that matter to your customers helps you build a relationship with your customer.
- Show a bit of gratitude. Saying thank you after every purchase demonstrates that you value their business. This simple two-word message can go a long way in earning your customer’s respect.
Customer care messages are also a great opportunity to get personal. Instead of sending an email, why not send a celebratory GIF via email or over social media, write a handwritten note, design a customized postcard, or send a simple thanks via SMS?
Lesson 3: Follow Up After Events and Webinars
You did it! You planned and successfully executed your in-person event or webinar. Now comes the most important step: the follow-up journey. This may be surprising, but the two most effective ...Go to next lesson