In the current ecommerce environment where attracting a new customer is increasingly expensive, improving your brand's repurchase rate is not just advantageous, it's imperative for maximizing the lifetime value (LTV) of each customer and achieving profitable and sustainable growth.
The repurchase rate, a measure of how often customers make repeat purchases, is simply a numerical representation of a brand's ability to retain its audience.
A multifaceted and efficient repurchase strategy enhances LTV and cements a brand’s relationship with its customer base, making every subsequent sale less about the cost of acquisition and more about the return on investment. This shift in focus from a one-time purchase to ongoing engagement is essential in today’s ecommerce market, where the depth and duration of customer relationships are key drivers of a company's success.
The following article covers approaches to improve repurchase rates by turning occasional shoppers into loyal, lifelong customers, thereby significantly improving both repurchase rates and the cumulative lifetime value of your audience.
In ecommerce, cutting through the noise to get your customer's attention and nudge them towards repeat purchases starts with hyper-personalization. This strategy, powered by customer data analytics, tailors email and SMS communications to echo the unique preferences and behaviors of each customer, setting the stage for more meaningful and impactful interactions.
Using customer data, brands can craft communications that resonate personally with each recipient. This isn't about bombarding your customer with generic sales pitches but engaging them with messages and product recommendations that feel bespoke. It’s about making every customer feel like your message is just for them, whether it's an email about items they’ve browsed or an SMS alert for a product launch in a category they love.
The goal of implementing hyper-personalization across email and sms marketing is to bypass not just the spam filters of email services but the mental spam filters we've all developed, ensuring your message isn't just seen but felt by the recipient.
Here's how to go about it -
Segmentation: Start with detailed segmentation of your customer data. This involves dividing your audience into highly specific segments based on factors like geographic location, purchase history, browsing habits, engagement levels and any feedback they've provided.
This detailed segmentation sets the stage for hyper-personalization, enabling you to tailor your communications in a way that resonates on an individual level.
Crafting Hyper-Personalized Messages: With your segments defined, the next step is to create messages that speak directly to each group.
Imagine the person behind the email address. What are their preferences, needs, or past concerns with your products?
For example, a message might read, "Hi Sarah, we noticed you've been looking at our summer collection. Given your love for vibrant colors, we thought you'd like our latest arrivals in azure and sunset orange. Let us know what you think!" This approach shows thoughtfulness and a personal touch that generic emails lack.
Automating for Efficiency: There's two levels to automating hyper-personalization.
The first is setting triggers based on specific customer behaviors, such as abandoning a cart or a lapse in purchasing, to send timely, relevant messages. This ensures each customer receives the right message at the right time, enhancing engagement without overwhelming your marketing team. Basic ESP tools like Klaviyo can help achieve this.
The second is using tools like LTV.ai that use AI to manually write each individual customer Email or SMS (mentioning location, past feedback & tailored product suggestions), to drive repurchases & increase owned channel sales by 10-25%.
Another incredibly effective application of hyper-personalization is in curating personalized product recommendations. By analyzing a customer's purchase history, browsing habits, and expressed preferences, brands can offer personalized product recommendations that hit the mark.
For example, a beauty brand might use purchase data to recommend a complementary skincare product, or an online bookstore might suggest novels in genres a customer frequently explores. These targeted recommendations don’t just drive sales, they enhance the customer’s shopping experiences, making them more likely to return.
Tools like Nosto or Lily.ai can be incredibly useful here with personalized product recommendation engines that plug into your communications.
Engaging your brand's customers and convincing them towards making repeat purchases requires multiple touchpoints and a multi-channel communication strategy. By harmonizing efforts across email and SMS (and social media), brands can create a seamless, omnichannel experience that keeps the customer consistently engaged with the brand's ecosystem.
To truly capitalize on the strengths of both email and SMS, consider them as complementary tools rather than isolated channels. For example, after sending a detailed product-focused email, follow up with an SMS that offers a timely nudge or exclusive incentive for customers who showed interest but did not convert.
This one-two punch approach ensures your brand stays at the forefront of the customer's mind, leveraging the immediacy of SMS to bolster the detailed content provided via email.
Here are some key points to keep in mind -
Synchronized Messaging: Maintain a consistent core message across both channels while tailoring the presentation to suit each medium's strengths. The depth and detail of an email complemented by the concise urgency of an SMS create a comprehensive narrative around your products or offers.
Personalization Across Channels: Utilize customer data to personalize both email and SMS communications. Tailoring messages according to the customer's previous interactions, such as page visits or past purchases, enhances relevance and fosters a deeper connection.
Optimize Timing: Optimize the timing of your messages to increase their impact. A well-timed SMS following an email can re-engage a customer at the perfect moment, significantly increasing the likelihood of conversion.
The integration and simultaneous use of email and SMS not only elevates the customer experience but also plays a crucial role in boosting repurchase rates. By engaging customers with a mix of detailed information and immediate calls to action, you cater to diverse preferences and interaction styles, widening your reach.
Moreover, the ability to quickly follow up on email interactions with SMS offers an agile way to capitalize on customer interest, making it easier to convert browsing into buying. As a result, customers are more likely to feel valued and understood, increasing their loyalty and the probability of them becoming repeat buyers.
Implementing detailed segmentation is crucial for ecommerce brands aiming to optimize their repurchase rates. By categorizing customers based on their behavior, purchase history and engagement levels, brands can tailor their communication strategies to meet the unique needs and preferences of different customer segments, significantly increasing the likelihood of repeat purchases.
Here are some segments that will allow for truly tailored communication -For a more detailed segmentation rundown read this article.
Effective segmentation ensures that each customer receives content that is relevant and engaging to them, significantly improving the customer experience and increasing the chances of repeat purchases.
LTV.ai helps brands build upon their segmentation foundation by consistently learning from individual customer behavior and constantly segmenting customers based on their actions, engagements and feedback.
Offering timely incentives is an efficient tactic in the ecommerce playbook for encouraging repeat purchases. By presenting customers with exclusive discounts, loyalty points, or early access to new products, brands can create compelling reasons for shoppers to revisit and engage further.
The effectiveness of an incentive significantly hinges on its timing as offers should be presented at moments when the customer is most likely to be receptive. This could be shortly after a purchase, during a known shopping season for the customer, or at a time when engagement levels suggest they might be looking for something new.
However, it's crucial to balance the use of incentives carefully. Overuse can create negative expectations, as customers may come to only convert with discounts, which eats into your brand's margins. Striking the right balance ensures that incentives remain a special rather than expected part of the customer experience.
When presenting an incentive, personalize it based on the customer's individual journey with your brand. An incentive for a customer who has shown interest in a particular product but hesitated to purchase can be the final nudge needed.
For example, "We noticed you've been eyeing our eco-friendly yoga mats. As a token of our appreciation, here's a 15% off just for you to make it yours."
LTV.ai generates personalized coupons ("AMY15") at times when they're most needed, with the context of an individual customer's journey with your brand.
Launching a loyalty program, whether paid or free, is a relatively higher effort yet extremely efficient move towards enhancing customer retention and encouraging repeat purchases. This initiative can significantly contribute to increased customer lifetime value (LTV), fostering deeper brand loyalty and engagement.
Central to the success of any loyalty program is the notion of treating loyalty members with an extra level of care and attention. This could present itself as priority customer service, personalized communications, personal shoppers or members-only products. Recognizing and rewarding your most loyal customers not only amplifies their perceived value but also solidifies their emotional connection to your brand.
Well-executed loyalty programs, by making customers feel valued and appreciated, directly impact repurchase rates. Customers enrolled in these programs are more likely to return, motivated not only by the rewards but also by the personalized and preferential treatment they receive.
Whether through accumulating points in a free program or enjoying the exclusive benefits of a paid membership, customers have clear incentives to make repeat purchases, thereby increasing their LTV.
For a detailed rundown on starting a loyalty program for your ecommerce brand, read this article.
A leading menswear brand, Ministry of Supply, was having issues with the relevance of their emails and thus not being able to truly connect with and convert all of their customers, despite detailed segmentation and triggers.
To combat this, they tested out LTV.ai to see how the addition of AI into their marketing stack would impact their repurchases, customer loyalty, customer satisfaction and LTV. The results were better than expected...
The overarching goal was to re-engage customers that hadn't purchased in 180+ days but had made at least 1 purchase with the brand historically.
These churned customers were incredibly valued individuals that had been lost by Ministry of Supply and they wanted to show them they cared and wanted them back.
LTV.ai sent a sequence of 5 text-based emails from a "brand ambassador" dedicated to these lapsed customers, mentioning variables like their physical location and previous feedback and offering personalized product recommendations based on their previous purchases.
These emails also featured dynamic coupon code usage, meaning customers only got coupon codes if they were proving incredibly difficult to re-engage. When coupons were offered, they were hyper-personalized ("AMY15" for 15% off) and varying levels of discounting was testing for different customer segments (some got 10% off, while others got 25% off).
LTV.ai's AI also held conversations with customers over email, to nurture the relationship and help guide them towards the next purchase that would be perfect for that one individual.
LTV.ai's impact was impressive:
🟢 $0.91 revenue per unique lapsed customer
🟢 +9.93% conversion rate
🟢 11.59% of total brand revenue driven by LTV.ai
🟢 20x ROI
Apart from this, LTV.ai also:
🟣 Sent hyper-personalized text based emails, with personalized product recommendations, that customers loved
🟣 Held 100's of AI driven conversations over email to nurture customer purchases
🟣 Only offered coupon codes when necessary to maximize margins
🟣 Gathered tons of feedback directly from customers to stop future churn before it occurs