The 3 Components of Building eCommerce Customer Loyalty

My grandfather purchased a new Oldsmobile every three years for most of his adult life. He was a mechanical engineer and an educated consumer who knew more about cars than most people. He didn't buy an Oldsmobile because it was the best product for the best deal. My grandfather purchased the same brand of car every three years because he purchased it from the same salesman. That salesman knew his business and paid attention to my grandfather. The Olds salesman connected with my grandfather emotionally, and sold him car after car without haggling on price, so, my grandfather, the tech-savvy engineer, was a fiercely loyal Oldsmobile man.

Loyal eCommerce customers cost less to maintain than it costs to acquire a new customer. They have higher average order values and tend to advocate your message to friends. A recent Adobe study, The ROI from Marketing to Existing Online Customers, shows that across retail verticals in the US, on average, 8% of online customers are repeat shoppers, and they make up 41% of total revenue.

To gain more repeat buyers and loyal customers, start by understanding what your passions are and where you want your business to go. Then look at your customers and discover what they care about. Understand the emotional benefit your customers receive from your brand. With this, you can turn good customers into fiercely loyal customers. Fiercely loyal customers won't bother looking for somewhere else to shop, and they tend to bring others to your brand. They are loyal with heartfelt, powerful intensity. Achieving this with customers that you can't shake hands with and look in the eye takes planning, honesty and vision, but when done right, can be very efficient and effective.

What's needed for fierce loyalty?

  • Compelling design and user experience that makes interacting with your brand easy and memorable
  • Consistently meeting customer service expectations
  • A loyalty program will help build a relationship and encourage brand evangelism

Design – The design of your eCommerce site should come from creativity and a vested passion in your products that pushes the limits into a unique and unexpected store experience. Compelling design evokes emotion and helps to develop loyalty because it encourages sharing, which can lead to eCommerce community building.

Customer Service – Serving the customer should be something everyone in your organization participates in so you can consistently deliver on promises. Train customer service reps in identifying passionate customers, and flag those customers for deeper relationship building.

Loyalty Program - Loyalty programs help create community and build brand attachment by rewarding beneficial behavior. They should be implemented everywhere your customers are interacting with your brand. Magento Enterprise Edition has powerful tools to reward customers by giving them virtual currency that can be used to discount future purchases at your store.

With Magento Enterprise Edition you can reward customers for:

  • Registration – This is the first step in beginning to know a visitor and start gaining their trust.
  • Newsletter signup - Be clear about how you will contact them, and confirm that you will never share their information with others.
  • Ordering - Reward customers for ordering, and optionally give more or less of a reward for the first order and subsequent orders. Test this carefully as your customers may not need rewards to make purchases. If you reward for purchases, some customers will only be interested in the incentive and won’t become connected to your brand. Don’t make rewards for ordering your only loyalty strategy.
  • Review submissions - Product reviews are a great way for others to know what's good on your site and what needs improvement. Reviews are also a great way for you to get unique, customer driven content on your site. Giving rewards for reviews should be part of any loyalty strategy.
  • Inviting visitors and helping them convert to customers - Customers that are respected brand promoters are customers worth incentivizing thoroughly. In addition to giving these customers points, identify them in the Magento admin, send them personal emails and interact with them on social channels. These customers can be fiercely loyal and are probably willing to invest time to show you how you can do even better.

Transactional emails can also help support your loyalty strategy. There are several emails that will be exchanged with customers who participate in Magento Enterprise Edition loyalty programs. Take the time to customize them, and make sure they reflect your authentic voice. If a visitor has not interacted with your customer service team, emails from your loyalty program may be the first opportunity to build a relationship. By breaking the ice and engaging in a soft transaction of registering or signing up for a newsletter, new visitors give merchants the permission to start looking at them as a customer. These new customers that you’ve engaged will be more receptive to future offers since they have given you permission to interact with them.

Delicious Karma, a social shopping site for food lovers, is an example of a Magento Enterprise Edition site that incorporates all three components of loyalty well. The design is attractive, easy-to-understand and encourages exploration. The imagery is crafted so customers can connect with a product as much as the screen allows. Delicious Karma also takes a personal approach to customer service, making sure any issues are resolved quickly and individually. The loyalty programs utilized by Delicious Karma extend Magento Enterprise Edition and Sweet Tooth Rewards functionality by incentivizing for customer action, as well as social interaction through Facebook, Twitter and Pinterest. To show how this loyalty strategy paid off for Delicious Karma, consider the Adobe statistic we mentioned where, on average, 8% of customers are repeat buyers; for Delicious Karma, 40% of customers are repeat buyers, and that’s a 500% increase for them. This phenomenal increase is due to the comprehensive approach for creating loyalty, which makes it easy for good customers to convert into fiercely loyal customers.

About the Author: Rocket Web is a full service Magento strategy, design and development boutique based in the Chicago area. Rocket Web is thrilled to contribute to the art of e-commerce as the winner of the Most Innovative Magento Enterprise site of 2012 for our work with Delicious Karma. We are continuously driven to innovate and solve complex problems with elegant solutions. Focusing on specialty foods, relaxed luxury goods and B2B verticals, Rocket Web offers a personalized, adaptive approach in partnering with merchants to dominate their market. You can follow us on twitter @rocketwebinc or the CEO @mattmac.

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