How customer retention in e-commerce can be measured using key indicators
It’s worth keeping a close eye on the customer retention rate as well as the repeat purchase rate. This KPI highlights how successful you are at satisfying customers long-term and ensuring they remain loyal to you.
The formula is calculated by determining what percentage of your customers re-order within a defined period.
Customer retention rate = no. of customers at the end of X (excluding new customers) / no. of customers at the beginning
Here’s an example: you have 80 existing customers at the start of a year. Over the year, you lose 15 customers but acquire 25 new ones.
((90 - 25) / 80) x 100 = 81.25% customer retention rate
So now we know how to measure customer retention in e-commerce. But how can you improve it? We’ve compiled a list of key pointers to ensure successful customer retention internationally for your online shop:
Five key tips for optimizing customer retention in cross-border e-commerce
- Providing the perfect customer journey
- Logistics is key
- Relevant purchase suggestions based on data analytics
- Using the customer’s voice
Providing the perfect customer journey
We don’t need to tell you how important the customer journey is to sustainable success in business. As a cross-border e-commerce specialist, we recommend providing your customers abroad with the opportunity to buy in your shop as they would at home. Customers will only return if you provide them with a high-quality customer journey.
Detailed insights into localization in cross-border e-commerce can be found in our blog article “Localization in cross-border e-commerce”.
Logistics is key in e-commerce
Reliable shipping partners, delivery to the door or mailbox, a customs clearance solution for consignments liable for VAT and a convenient returns process are all vital in online retail. Paying special attention to logistics will reap rewards.
Poor logistics can result in your online shop receiving bad ratings, harm customer satisfaction and adversely impact on customer retention in e-commerce. That’s why a trustworthy, reliable customs clearance and shipping partner is crucial.
Tip: If you send consignments liable for VAT, you need to find a customs clearance solution. Cross-border e-commerce customers do not expect to incur any unforeseen costs on delivery. Swiss Post’s customs clearance service provides a smooth solution. Arrange a free consultation with our e-commerce specialists today.
Relevant purchase suggestions based on data analytics
The major online platforms have been leading the way for some time. The better you know your customers, the more successfully you can provide personalized product recommendations, keep your customers happy long-term and increase their loyalty.
Using the customer’s voice
Testimonials undoubtedly attract attention and strengthen the credibility of brands and products. Successful online shops make targeted use of testimonials to gain the trust of their customers, increase the attractiveness of their products and contribute to sustainable success in business.
Net promoter scores (NPS)
The most common way of obtaining customer feedback is to use a net promoter score. This is a key figure that measures the likelihood of your customers recommending the product or service. It provides an indication of customer satisfaction and loyalty.
In short: customer retention in e-commerce can be successfully achieved with the right measures
The key thing is to always align the measures with your communications strategy, shop, products and services. And don’t forget to measure customer retention figures at regular intervals and to interpret them correctly.
As long as you keep a close eye on all the relevant aspects and do not overlook the importance of simple logistics solutions for your customers, success is guaranteed!
Arrange a free consultation today to ensure your international logistics solutions meet today’s customer requirements.