You worked so hard and did everything right.
You built a beautiful eCommerce store using tools like Shopify and have some really great products to sell.
And while you’re getting a healthy amount of sales, you’re not yet seeing the revenue growth you wanted.
The problem could be that you’re not getting enough repeat purchases.
In this post, we’ll show you why repeat purchases are critical to the growth of your online store and how you can use email to encourage those first-time buyers to become loyal repeat customers.
A recent study by RJmetrics on eCommerce performance highlighted the importance of repeat purchases when it comes to growing revenue.
They studied data from hundreds of eCommerce companies and found that companies in the bottom three quartiles of performance started out having no repeat purchases, and by year 3 were driving just short of 50% of their revenue from repeat customers.
However, the companies in the top performance quartile had a very different path.
Even just a month or two into launching, they were driving 20-30% of their revenue from repeat purchases, and they were able to grow that over time so that by year 3 they were driving over 60% of their revenue from repeat customers.
While it might not seem like a big difference at first, when you look at the revenue growth of the companies in each quartile it becomes clear how important repeat purchases are.
The companies in the top quartile (those that were driving 20% of revenue from repeat purchases in the first 3 months) are generating 5x more revenue than those in the bottom 3 quartiles.
By focusing their marketing efforts on driving repeat purchases from their existing customer base, these top performing stores were able to grow their revenue far more rapidly than their counterparts and ultimately create stronger businesses.
The above graphs tell a very convincing story of the importance of generating repeat purchases, but how do you actually do it?
According to Tommy Walker from Shopify, the key is to create an amazing experience for your customers that makes them want to do business with you again.
And while creating an amazing customer experience encompasses more than just email (i.e., An easy checkout process, fast shipping, great customer service, etc), there are a number of ways in which you can use email to give your customers an amazing purchase and post-purchase experience that keeps them coming back for more.
Transactional emails (like order confirmation and shipping confirmation emails) are often neglected by eCommerce marketers in favor of newsletters and promotional campaigns, however, they actually present a significant opportunity.
So how can you optimize your transactional emails to create a better customer experience and increase repeat purchases?
Here are a few ideas:
Although it’s a good idea to add other content like social links and related products to your transactional emails, you first need to make sure you’re clearly giving customers the information they need (like shipping tracking numbers, or login details).
Campaign Monitor customer BuzzFeed does this well with their registration email.
Although they go on to promote their community area at the end of the email, the user’s account details are the first and most prominent elements of the email, making it highly useful to their members.
So when optimizing your transactional emails (particularly order confirmation and shipping confirmations emails), think about the information the customer would want from this email (estimated arrival times, tracking numbers, etc.) and ensure that information is front and center to help create the kind of customer experience that keeps people coming back.
More often than not, transactional emails contain essential information– like tracking numbers or flight confirmation details – that customers need to reference later.
To help create a great customer experience that keeps them coming back, make sure to use keywords in the subject line and body copy to ensure it can easily be found using the search functionality built into email clients like Gmail and Outlook.
Take the following email from Priceline.
Between the subject line and the body copy, a customer could easily find this email in their inbox by searching terms like “Sydney itinerary,” “Sydney trip” “Virgin flight,” or any other variant.
So when optimizing your transactional emails, make sure to proactively think about how you can use the subject line and body copy to make the email easy to find in a crowded inbox, as often a customer will want to go back and reference the email at a later time.
Although it might seem small, making sure the customer has a pleasant experience at every touchpoint is what it takes to make the overall experience amazing, and is key to driving repeat purchases.
With transactional emails having an 8x higher open rate than standard promotional emails, it makes sense to include links to related products or a referral program to help grow your business and offer customers products and incentives they may be interested in.
Uber does a particularly good job of this in the transactional emails that go out after a customer has taken a ride.
In the top right corner of their email, they promote some of their other ‘products’ such as UberPool. They even include a discount code that not only encourages people to try out the product but allows them to track how many people are converting from the promotion in the email.
Furthermore, Uber also includes a link to their referral program in the bottom right-hand corner of the email, offering free rides to any customer who refers another customer.
This referral program has been a significant part of Uber’s growth, according to the Uber blog:
Uber spends virtually zero dollars on marketing, spreading almost exclusively via word of mouth. 95% of all our riders have heard about Uber from other Uber riders. Our virality is almost unprecedented. For every 7 rides we do, our users’ big mouths generate a new rider.
Although they attribute this growth to their user’s ‘big mouths’, you can bet promoting the referral program in places like their transactional emails has significantly enhanced the virality and helped drive growth for their business.
For many online stores, the shipping confirmation email is the final time you’ll communicate with a customer in relation to the purchase.
However, that’s not the final touchpoint the user has with your product and your brand. Before they start using the product they might need to set it up or install it, then they may need to learn how to use it, and they might even need to maintain it over time.
So in order to give your customers a great experience with your brand that keeps them coming back, consider sending a post-purchase email sequence that helps them get the most out of the product they just purchased.
Here are a few ideas:
Depending on the complexity of your product, it could be helpful to follow up with the customers shortly after purchase and provide them with some content and information on how to get the most out of it.
Online bedding retailer Parachute does a good job of this in their post-purchase email sequence.
Shortly after a customer purchases bedding, they receive the above email campaign containing information on how to take care of it.
The email links to a post on their blog that contains information on how frequently to wash the bedding, what detergents to use, how to fold and store the bedding, etc. Everything a recent purchaser needs to know to extend the life of the bedding and keep it feeling great.
By using marketing automation tools to automatically send useful information to customers post-purchase, Parachute helps customers get the most out of their products and creates a great experience that encourages repeat purchases and drives word of mouth.
Tommy Walker of Shopify, one of the world’s leading experts on eCommerce growth, says the key to driving repeat purchases is to create an amazing experience for your customers that makes them want to do business with you again.
But how do you know if you’re creating an amazing experience? And how do you know what areas need to be improved?
It’s simple, you ask your customers.
Campaign Monitor customer Jaybird does a great job of this with their feedback request email.
Shortly after making a purchase, they reach out to customers asking for feedback on the purchase experience and how they can make it better.
Not only does this automated email secure them valuable feedback they can use to improve the experience, but it provides an important opportunity to get their happiest customers to advocate for them.
Most modern survey tools (like GetFeedback for instance) provide the ability to branch questions based on responses, so if someone was to rate their experience of purchasing from you 5 stars, then you could ask them to leave a review of the product on your online store or on review sites like Trustpilot, which can help drive sales.
By using marketing automation tools to automatically send a feedback request email, Jaybird is helping customers get the most out of their products and creating a great experience that encourages repeat purchases and drives word of mouth.
According to research, the likelihood of a customer making another purchase actually increases with every purchase they make from you.
Because of this, it’s important to keep in touch with your customers after the initial communications about the purchase have concluded (i.e. after the transactional emails and the post-purchase emails have been sent) in order to keep them coming back to your store.
Here are a few ideas to achieve this:
Sending a regular email newsletter is a highly effective way to keep in touch with customers over time. It keeps them informed of your latest products and announcements and keeps your store top of mind.
This campaign from Campaign Monitor customer Rip Curl is an excellent example:
Although Rip Curl also sells menswear and regularly has new products to announce, they know the gender of their customers and use features like segmentation and dynamic content to only show womenswear to their females.
This ensures the content is relevant to every customer who receives the campaign and increases the chances they’ll open it, click-through to the site and make a repeat purchase.
A birthday is a special day for anyone, and wishing your customers happy birthday via email is a great way to keep in touch, make them feel special, and drive repeat purchases.
Campaign Monitor customer Birchbox does a great job of this in the lead up to their customers’ birthdays.
Not only do they wish their customers happy birthday and make them feel special, but they offer a gift of $10 off purchases in order to encourage people to make a repeat purchase.
As an online retailer, you have a multitude of opportunities to create promotions and run special offers, and using email to inform customers of these can be a great way to keep in touch.
Take this example from Campaign Monitor customer Birchbox.
Birchbox used the change of season to create a co-marketing promotion with Rifle Paper Co. and then sent a segmented email campaign to their customer base informing them of the promotion, keeping their brand top of mind and driving repeat purchases.
So next time you have a special event, offer or promotion that you’re launching, make sure to leverage it in your email campaigns as a way to keep in touch with customers. These regular touchpoints help drive repeat purchases and grow revenue for your store.
As the statistics showed, creating a great experience that encourages repeat purchases from your customers is a pivotal part of growing revenue from your online store, and email marketing is one of the best ways to consistently communicate with your customers and drive repeat purchases.
It’s never been easier to create beautiful transactional emails, setup automated post-purchase journeys or create and send newsletters, birthday emails, and promotional campaigns.
So dive in and get started using email marketing to communicate with customers and drive repeat purchases, and watch your revenue grow.