Customer retention: 15+ marketing strategies from top thought leaders in ecommerce
Imagine cooking Thanksgiving for a new family every year. What if you spent your birthday with the last three people you met? Poured your heart out with a new romantic partner every few months?
To some, this might sound like heaven. The novelty is appealing. But starting new relationships—and community bonds of all types—is work. Ecommerce is no exception.
The truth is that there are only so many people who need your product. And while some verticals lend themselves better to subscriptions or other types of repeat purchases, customer retention is key for the health of your business—no matter what you’re selling.
In this guide, you’ll get a primer on the best retention marketing strategies from thought leaders across ecommerce industries.
Whether you use this advice to improve your already existing program, kickstart a program ASAP (before BFCM), or just make sure you’ve checked off all the best practices, our experts—from brands including Jones Road Beauty, Recharge, Okendo, Gorgias, LoyaltyLion, Tapcart, SkinnyDip London, Shipbob, and, of course Klaviyo—cover it all.
Table of contents
- What’s standing in the way of retaining your customers
- Retention and acquisition: two sides of the same coin
- A seamless customer journey: the best retention marketing strategy
- Creating and keeping loyal customers
- Keep track of your retention marketing efforts
What’s standing in the way of retaining your customers
Marketing is its own wild horse to wrangle, even in the best of circumstances.
We’re living through some unprecedented times—a pandemic, a bear market, large-scale weather events. Whether you’re doing business out of a brick-and-mortar location or exclusively online, you’re getting hit with changes that are likely to throw you for a loop.
Below are a few obstacles beyond a marketer’s control that can affect customer retention rates.
Changing—and strengthening—privacy laws
Jeremy Horowitz, partner marketing team lead at Gorgias, cites Apple’s iOS 14 update as pivotal in customer data privacy changes. Before iOS 14, Facebook was able to pull more customer data, tracking nearly everything a user clicked on and allowing for precisely targeted advertising.
Horowitz says Facebook used to feel like a “magic money machine” to a newer entrepreneur. But those days are over, at least for now.
Post-iOS 14, social sites can collect and pass along far less data from the customer—which means it’s no longer as easy or straightforward to personalize your ads. This is one of the reasons you may notice less revenue coming from the ads you run on social.
Dara Denney, director of performance creative at Thesis Testing, describes the drastic change this way: “It was literally like a plug was pulled. Almost overnight, we lost sight of 50% of our metrics. It changed the way that we needed to interact with these platforms, as well as how we use them to find new customers.”
“Couple privacy law changes with the fact that Facebook and other social sites began attracting bigger brands like Walmart,” Horowitz says, “and suddenly, everything on social media got more competitive and more expensive.”
“CPA (cost per acquisition) has gone up, and businesses are priced out of the revenue they’ve gotten used to,” Horowitz adds.
All of this means brands need new game plans. According to The Wall Street Journal, in response to those changes, cosmetics brand Jones Road Beauty slashed their spending on Facebook and Instagram by 25%. Athleisure brand Feat reduced their budget on the same channels by 20%.
This is not to say that advertising on social media is over. Facebook and Instagram are still two of the most popular social media platforms. It just means marketers need to “create new narratives to pull people down conversion paths,” says Nik Sharma, head of Sharma Brands.
Below, for example, is an Instagram post from Jones Road Beauty. Instead of a “buy this now” message, the post communicates more of an invitation for shoppers to find out more about themselves, the products Jones Road Beauty sells, and the potential benefits of shopping with the brand.
A message like this is smarter and a bit more subtle, and more likely to pull a user down a conversion path.
Inflation, a bear market, and a potential recession
No one can ignore inflation—recently, it exceeded more than 40-year highs, and the US federal government raised interest rates for the first time since 2018.
Internationally, some actual inflation rates (particularly in Europe) are twice as high as projected.
As interest rates continue to rise, Horowitz explains, consumer confidence slows. People spend less money and are less likely to try a new brand.
While pandemic-related restrictions have eased in certain ways (more in-person events, lighter regulations around masks), the effects of it linger: supply chain issues, manufacturing delays, material shortages, and high shipping costs.
Prices on commodities like fertilizer have risen sharply. And as the war in Ukraine continues to restrict the country’s exports, the devastating effect is that food prices have reached record highs, surpassing even the surges in 2008 and 2011.
All of this can add up to more reluctant customers who have many reasons to save their money.
So, how do you raise a customer’s lifetime value in an increasingly unstable and unpredictable global economy.
Retention and acquisition: two sides of the same coin
For better or worse, customer retention begins with customer acquisition. No one can skip acquisition marketing—of course, “if you don’t acquire, you have no one to retain,” says Chase Alderton, partner marketing manager at Recharge Payments.
Eli Weiss, senior director of customer experience and retention at Jones Road Beauty, puts it this way: “a great ad can bring in a new customer—but it can’t fix a bad product or experience.”
But, if you have the choice of acquiring 100 new customers or retaining 100 existing customers, Alderton says, a marketer should always strive to retain: “Existing customers are already brand ambassadors. They see the value of what you’re selling. If they’ve bought something from you more than once, there is something about your brand that they like.”
A seamless customer journey: the best retention marketing strategy
For Alderton, both customer acquisition and customer retention benefit from the same philosophy: to provide the absolute best customer experience you can, from the beginning to the end.
Alderton urges marketers to think of the big picture—the entire customer journey. “If you were the customer, what would you want to see next?”
In other words, “How much more value can I provide?” is a more productive question than “How can I retain this customer?”
So, what are some of the ingredients that add up to a seamless customer journey, making your customers want to come back?
Paid ads that your new customers come across on social media
The copy should be short and concise, and the image should contain the most important information you want the reader to take away.
The call to action that takes them to a landing page should create a smaller customer journey within the larger one. Ask yourself: Are users getting what they want by clicking on the paid ad?
Also, there’s no uniform way of doing paid ads. Make sure you “hammer and test” regularly to find out what works best for your brand.
Marketing campaigns they see in their inboxes
These marketing campaigns should create urgency and excitement, showcase your products’ appeal, and have clear and direct calls to action.
Lindsay Kolinsky, partner marketing lead at Okendo, says this is a great place to share your starred ratings, reviews, and photos or videos to add social proof to your email marketing campaigns.
Product pages customers browse
You’ll want the “add to cart” button above the fold, even on mobile. You’ll also want the messaging to convey both what the product is and how your audience will benefit from it. Most importantly: know the specific audience you’re talking to.
But that’s not all: product detail pages are another place to showcase your reviews. In fact, Kolinsky says reviews are some of the most browsed sections of these pages.
The check-out flow your customers experience
Make sure yours:
- Is optimized for mobile
- Allows guest check-out
- Is distraction-free
- Offers popular payment methods
- Removes surprise fees
- Features a security seal or badge
- Uses form validation to catch errors or missing information
- Offers a connection to customer support if necessary
- Auto-saves cart content when abandoned
- Uses discount codes carefully
Shipping and delivery
We’ll go more in depth about this later, but, to begin, make sure you invest in a delightful unboxing experience, always keep enough product in stock, and give your customers frequent updates about the status of their delivery.
Don’t miss the opportunity to use these to teach customers how to use your product, build trust and confidence in your company, and guide customers to their first positive experience with your brand.
Interactions with customer support
These folks are the face (and voice) of your brand—the only truly personal interactions your customers have, especially if you don’t have a brick-and-mortar presence.
Make sure you and your team are clear on how you want those interactions to go, and that your team is fully trained on the why and how of building those connections. (We’ve got a whole section on this one, too.)
Beyond those important ingredients, here are 3 more crucial steps to remember when you’re figuring out how to create that cohesive experience.
First things first: you need a working tech stack
Kolinsky, partner marketing lead at Okendo highlights the importance of a functioning tech stack.
“It’s less about creativity,” she says, “and more about doing the basics correctly so the user experience is seamless. Making sure your tech stack works correctly is a great first step.”
This isn’t as easy as it sounds. In a recent survey Klaviyo conducted in partnership with BWG Strategy, we found that only 2% of ecommerce executives are pleased with their current tech stack.
The problem may be legacy tech stacks, which tend to be “expensive, glitchy, and costly to maintain and customize,” writes Kunle Campbell, host of the 2X eCommerce Podcast and co-founder of Octillion Capital Partners.
When building (or re-working) your tech stack, one of the sharpest tools in your arsenal is a single customer view, which you can achieve with Klaviyo’s customer data platform.
A single customer view helps you to deliver an experience-first build—in other words, “you have to design a tech stack for the people who actually use it,” Raj Yavatkar, chief technology officer at Juniper Networks, shared in Forbes.
First, the user experience needs to be fast. You don’t want to lose potential customers because your front end is glitchy or slow.
It also needs to be easy to understand and navigate. This means investing in continuous redesign of the front end, especially if your company is growing quickly.
Finally, it’s also important to track customer journey analytics so you can implement customer experience improvements.
But don’t let tech be all your customers see—people matter too
Recent industry research shows that businesses are losing up to $62B in revenue per year through poor customer service.
“You need to look for little moments that break the script of what your audience is expecting,” Weiss says.
What does that mean? At Jones Road Beauty, Weiss encourages his support team, for instance, to be themselves, rather than solely focusing on brand voice. He wants their customers to know they’re speaking with an actual person, rather than a nameless company representative who’s just reading a script.
“In order to have a great experience with a brand,” Weiss says, “you have to have a great experience with a person.”
Weiss also encourages the customer support team to refer to themselves as “I” instead of “we” and to take accountability. This helps them connect with customers, who in turn feel seen, heard, and like the brand is taking responsibility for the complaint.
Jones Road Beauty’s results are hard to argue with. According to Weiss, an impressive 46% of customers responded to a recent CSAT survey request. Their 90-day CSAT score was 4.93 and their 90-day CES score was 93/100.
You’ll be exceptional if you simply meet expectations (seriously)
Almost 50% of consumers report that brands don’t meet their expectations.
While many brands aim to differentiate themselves through unique experiences, the takeaway here is that simplifying your goals to simply meet expectations may lead to a better customer experience.
That’s right—don’t try to exceed expectations.
Instead, Weiss suggests, make sure that every leg of the customer journey is communicating the reality of what you will deliver. If you’re promising fast delivery, for instance, you have to follow through on that.
The image below, from Jones Road Beauty’s website, shows a model along with instructions on how to get their bronze glow. This leg of the customer journey is educational and useful. It may motivate the customer to buy the products, knowing that they’ve got a guide on how to best use them.
Another example of a brand meeting customer’s expectations (while building connection, giving their subscribers a great deal, and showing a damn good sense of humor) is Curie.
Curie found a typo on a batch of deodorant sticks and really made the most of it. First, they showcased the typo front and center with the 15% off sticker front and center. Next, they wrote a short, funny message that totally owns the mistake, even including extra typos that are likely to catch the eye. Finally, they made the discount code refer to their mistake.
Creating and keeping loyal customers
Aurora Sánchez Alava, CMO and co-founder of Webmefy, works with brands to create loyalty through more personalized experiences. She lists the following as great ways to build loyalty:
- Rewarding customers’ spending points with a loyalty program to help them upgrade to the highest tier
- Different loyalty tiers—the higher you go, the better the benefits
- Rewards for special dates (birthdays, anniversaries)
- Making customer content part of the brand’s social media content and offering shout-outs
Building relationships through loyalty programs
Of course, loyalty programs themselves are great at building loyalty. And no one knows more about loyalty than LoyaltyLion.
Programs that are executed thoughtfully and strategically can yield huge benefits. Beth Wells, senior partner marketing executive at LoyaltyLion, helps brands create a loyalty program that goes beyond points and rewards, driving greater customer lifetime value and more cost-effective acquisition through better customer relationships.
Wells shares that a first-time customer who signs up for a loyalty program spends 40% more on average than a first-time purchaser who doesn’t.
She offers these tips when implementing a loyalty program:
- Make signing up easy and intuitive.
- Make the benefits of your loyalty program crystal clear.
- Offer a dedicated rewards page to create a unique, on-brand loyalty experience.
- Don’t shy away from promoting your loyalty program on social media.
- Treat new customers to a perk for signing up for your loyalty program—this could be loyalty points or even a free gift.
- Offer enough points on the first purchase that it’s worth it to sign up.
Sustainable fashion brand Alohas, for example, has a clean, easy-to-understand, dedicated rewards page.
Social media and loyalty programs: an overlooked match made in heaven
Wells emphasizes that social media is a great place to plug your loyalty program and the benefits of joining. She says “you’re likely to be already promoting your loyalty program through email and on your website, but there’s a largely untapped audience waiting to hear about it on social media. Your social followers are prime candidates for your loyalty program because they are already fans of your brand.”
Wells shares that not only can you use social media to promote your loyalty program, but you can also use your loyalty program to enrich your channels with social proof and reach new customers.
“Incentivize your customers to engage with your brand on your social channels in exchange for loyalty points. Authentic and trustworthy user-generated content across your social channels represents a huge opportunity to reach and influence new customers without having to invest in increasingly expensive additional acquisition activities,” Wells explains.
Kolinsky adds that reviews are some of the best ways to identify your top customers. If someone leaves a 5-star review, you can invite them to your loyalty program or ask them to refer a friend.
With Okendo, you can offer tiered incentives for leaving a review. That might mean a 10% coupon off a future order for a review, with the option to receive a 15% coupon if you upload a photo or video with that review. The Okendo and Loyalty Lion integration lets you incentivize reviews with loyalty points instead of a coupon.
Okendo sets you up to use the review content in paid ads, since their terms and conditions dictate that you own that content. The social proof helps create trust and increase conversion, Kolinsky says.
Email marketing as a retention strategy
Email is an important channel for making your customer base feel seen.
In the webinar “How to skyrocket your retention marketing revenue” earlier this year, Bayley Markopoulos, senior email marketing manager at Klaviyo, noted that a good segmentation strategy with a smaller list will do more to keep customer retention high than maintaining a giant list.
“You’re competing for inbox space,” she explained. “Use first-party data to create smaller, more personalized audiences who resonate more with the message you’re sending out instead of a batch-and-blast approach, and hoping your message will resonate with a very small percentage of those people.”
Markopoulos’s co-host Ramzey Nassar, founder and CEO of Prolific Media, added, “if you’re able to segment smaller audience sizes, you’re likely to see higher click-through rates—one of the main KPIs we focus on.”
So, how exactly do you create a retention marketing strategy to increase click rates, improve email deliverability (and get out of that spam box once and for all), and grow customer lifetime value (CLV)? Let’s dive in.
Consider a loyalty-led email marketing strategy
Wells cites LoyaltyLion’s deep integration with Klaviyo as a way to access to a suite of meaningful loyalty data that enables them to deliver powerful loyalty-led emails.
By combining loyalty data with event-based triggers, those emails can provide your shoppers with personalized and timely experiences that make them feel more connected. The results speak for themselves: loyalty emails perform 14x better than regular marketing emails when they’re more personal and relevant.
Faherty, a family brand that sells comfortable, casual clothes, sends this email encouraging referrals for cash off. The incentive is front and center, with a clear action to take.
Segmentation to guide a customer to a subscription
Alderton points out that early in the funnel, you can interact with a first-time buyer in a way that can lead to powerful segmentation.
For instance, Kolinsky notes, a customer who has left a 5-star review is a prime candidate for a subscription.
Nearly anything a buyer purchases for their home and bathroom has the potential to be put on subscription. But that doesn’t mean the buyer is necessarily thinking about it in those terms. If you can ask them a question or two during their first check-out, you may get an answer that can help you effectively segment them later.
For example, how big is their household? A 10-person family will respond to very different emails than a bachelor living alone, and now you can talk to them like you know them. Because you do, even if only a little.
Chamberlain Coffee offers visitors a 10% discount to take a quick, simple quiz. From there, the brand gains valuable information about the visitor—including their email address.
How else can you build loyalty?
Answers that move the needle may surprise you. Alderton advocates for building brand loyalty and driving repeat purchases not only through the typical practices of discounts and referral incentives, but also through some newer ways.
Gated content to build customer loyalty
Let’s say a coffee enthusiast makes an initial purchase of a bag of your premium beans. And let’s say you’ve gone to great lengths to make sure the beans are fair trade, ethically harvested, and of the highest quality.
You, like your current customers, are a coffee geek. Chances are, your new leads are, too. Alderton says a creative way to turn them into repeat customers is to offer them access to exclusive gated content if they sign up for a subscription.
Maybe they read the story of the family farm the beans are grown on, or watch an interview with the folks who grow them and see the journey of how the beans are brought to the US.
Logging into a portal might normally feel transactional, but Alderton emphasizes that merchants should “use your existing touchpoints as additional value drivers.”
Yes, you’re spending money on that content marketing. But you would likely already be spending that money anyway. It’s difficult to measure customer satisfaction through something like content marketing, Alderton acknowledges.
But, he continues, customers tend to love how curated this kind of content can be, and it can make them feel like your brand truly cares about them. It’s an indirect way to build customer loyalty and retention.
They’re on your website buying your product—and not on Amazon, getting a form response—for a reason. Make the most of that.
The image below shows how Shopify displays some of the gated content a visitor receives once they sign up for a free trial.
An app for an even more personalized customer experience
Sarah Toth, head of partner marketing at Tapcart, a mobile platform builder for Shopify merchants, shares another retention marketing channel—one that’s perfect for recurring customers.
Tapcart specializes in helping Shopify stores transform their dot com into an app. With a drag-and-drop interface, you don’t need to know how to code. Tapcart simplifies it for the merchant.
Toth notes that a customer is usually pretty far along in their relationship with your brand before they’re willing to download an app.
But once they’re there, the benefits (for them and for you) are substantial:
- They’re already logged in—no need to remember a password.
- Their credit card information is already saved.
- Their customer preferences are right there.
- All their user info is stored within the app.
- It’s easier to enable one-click check-out.
Toth shares that apps for shopping, like SMS marketing, are increasingly relevant and popular.
And the space on a customer’s phone is “real estate”—she highlights how valuable it is.
“Once someone has invested in your brand enough to download your app,” she says, “it’s like buying, not renting. These people want to buy into your brand. And you want to play into their desire to buy in.”
Of course, brands need to motivate their audience to download the app, she continues, via discount or exclusivity. Toth emphasizes that you don’t need to wait until someone has purchased multiple products—you can begin to advertise immediately, offering incentives, promos, exclusivity, personalized experiences and more through an app.
Push notifications for customer retention
Once your customer base has downloaded your brand’s app, they can opt in to receive push notifications. These can be an even better way to reach customers than email and SMS.
What are some advantages of push notifications?
- They can feel less intrusive than text messages (especially when the SMS is green).
- To the customer, they feel native to the phone.
- For the merchant, they’re free and unlimited.
- They go directly to the user who you want to see your ads.
To Toth, apps (and accompanying push notifications) have less friction than email, and are less jarring than SMS. “Apps help you cut through that noise to better reach your customers,” she explains.
The push notification in the image below offers a discount, and the messaging is fun and playful—a perk of your customer buying in at the level of downloading your app is that you know they’re up for hearing from you.
Social media and Gen Z: the “smartest customer”
Laurina Kennedy, digital marketing manager at SkinnyDip London, advocates for social media as “massive for brand awareness” and creating community for SkinnyDip London. One thing she’s learned in the past few years is that “people on social media don’t want to be fed product after product—they want to see the story behind the brand.”
SkinnyDip London has noticed that product posts get the least amount of engagement on their social feeds. Kennedy thinks historical context is key to what’s driving the change.
“The whole world spent the majority of the last two years on their phone, on social media. And they’re bored,” Kennedy points out. “Scroll time is decreasing, so how do you engage with your audience?”
SkinnyDip London’s audience is mostly Gen Z, whom Kennedy describes as “the smartest customer we’ve ever had. They know they’re being sold to. But they’re also the loneliest.”
That’s why creating community around social posts works so well. The SkinnyDip London girl is rebellious and fun. Their tagline is “here for a good time.” Below is an Instagram post from their feed that pushes the envelope, but is likely to make that girl feel seen, even encouraged.
Kennedy sums up SkinnyDip London’s strategy in keeping Gen Z engaged as communicating through “the heart, not the head.” Social posts are constantly feeding young people information about what to buy. SkinnyDip London tries to stand out by making an emotional connection.
Shipping and fulfillment as a retention marketing tactic
Kristina Lopienski, director of content marketing at ShipBob, says logistics is often overlooked when it comes to marketing. While it might not seem intuitive, she shares, she’s found that some of the most successful ecommerce brands utilize fulfillment and shipping as a retention driver.
Through ShipBob, Lopienski sees merchants providing:
- Free and fast shipping
- Estimated delivery dates and two-day shipping badges on eligible orders and product pages
- DDP shipping for international orders
- Order tracking and frequent fulfillment updates
- A beautiful unboxing experience (custom-branded boxes or poly mailers, marketing inserts, custom gift notes, etc.)
In order to extend CLV, Lopienski says, ecommerce brands must have a thoughtful logistics strategy in place. It’s not just about the delivery experience—you also need to have enough product in stock.
One “very behind-the-scenes way” to keep the shipping experience pleasant and seamless, she shares, is to distribute your inventory. Storing your products in more than one warehouse to be closer to more of your customers can help you keep delivery times down. You can do this by partnering with a fulfillment company—you don’t need to lease or purchase your own warehouses.
Lopienski acknowledges that retention marketing often needs to recoup money from upfront acquisition costs. In order to save, brands try to reduce logistics costs.
Splitting inventory across multiple fulfillment centers in different regions can help reduce not only transit times for faster delivery, but also shipping costs. This is especially helpful when distributing inventory across borders.
“It helps remove complexities such as having orders getting held up at customs or incurring high duties that are associated with cross-border shipping,” Lopienski explains.
Keep track of your retention efforts
Once you’ve put everything in place, it’s imperative that you keep track of which retention tactics are working. Lopienski lists the following metrics to keep an eye on:
- Codes redeemed from marketing inserts
- CLV and customer acquisition cost (CAC):CLV ratio
- Landed costs and margins
Sánchez Alava emphasizes the importance of paying attention to your churn rate, as well as AOV.
Lopienski touts the ShipBob x Klaviyo integration as the best way to keep track of the metrics above. “Being able to provide a more transparent shipping experience helps brands significantly reduce order confusion and gain even greater customer trust,” she says.
She highlights the more granular updates like “your order has been picked up” and “your order is awaiting carrier pickup” that make the experience much more personalized. This also helps reduce support tickets.
Customer retention, hand in hand with growth, is really what keeps your business going all year long. But the holidays are a great time to implement some of the suggestions shared by the folks in this blog.
A best-case scenario for your retention marketing efforts? Wells sums up some goals for brands:
- Retain existing customers.
- Increase LTV.
- Build personal relationships.
- Create brand advocates.
- Prevent over-reliance on discounts.
Retain more customers by learning about more ways to collect Customer-First Data™, during the holidays and beyond.
back this year?
Even without the data privacy changes and increased ad costs, focusing on customer retention is a proven way to increase revenue. When you nurture customer relationships, you create a reliable, ongoing revenue stream.
Customer-first marketing is about remembering the human being behind the customer profile. And when you form an authentic connection with your customer, they’ll feel good about interacting with you—and it won’t take long for them to become a loyal customer.
Want to learn more retention strategies? Lean into consumer trends and create engaging emails for your brand