Framework for retention marketing for ecommerce stores

1. Retention Marketing
Keep Your Customers Coming Back For More

2. Background
I have extensive experience launching
and growing ecommerce email
marketing programs across a wide
variety of industries (apparel, cosmetics,
home & furniture, baby gear, toys, pet
food, security, hardware, etc.) and stores,
ranging from mom-and-pop operations
to Internet Retailer 500 brands.
My company, Essence of Email,
specializes in email marketing for
ecommerce shops.
Contact Info: x@essenceofemail.com
Xiaohui “X” Wang

3. Acquisition vs. Retention – the case for
more retention marketing
 Costs 4x to 6x more to acquire a new customer than to retain
an existing customer
 Ecommerce spending is on average $24.50 for new
customers and $52.50 for repeat customers
 On average, online retailers lose 25% of their customers
every year
 A 2% increase in customer retention has the same effect as
decreasing costs by 10%

4. Key Metric – Customer Lifetime Value
 The key metric to focus on is Customer Lifetime Value (CLV)
 To increase profitability, you need to increase CLV or
decrease cost of acquisition (CAC)
CLV = Average order value * Frequency of purchases* Retention
lifetime
 This means there’s 3 ways to increase CLV:
 Increase average order value
 Increase frequency of purchases
 Increase retention lifetime

5. The Retention Marketing Formula
A Great Customer Experience + Effective Lifecycle
Communication = Customer Retention

6. Customer Experience

7. Elements of Customer Experience
 Purchase Experience
 Support, shipping, returns, price
 Brand
 Design, copy, personality/voice
 Product
 Quality, durability, perceived value

8. Zappos – deliver WOW through service
 Support
 Shipping – always free shipping
 Returns – 365 days, free return shipping
 Brand Voice – Witty, conversational

9. Bonobos – a pair of pants to leading
men’s clothing retailer
 Support – Bonobos “ninjas”
 Shipping – free shipping
 Returns – 90/365 days, free return shipping
 Design – beautiful design
 Brand Voice – very clever copywriting
 Product – still best known for the perfect pair of pants

10. Bonobos – a pair of pants to leading
men’s clothing retailer

11. Lifecycle Communication

12. The Customer Lifecycle
Customer
purchases
Post-Purchase
Period
Latent Period
Repurchase
Period
Win-Back
Period

13. Post-Purchase Period
Immediately after the purchase
 Order Confirmation
 Primarily focused on transaction information
 Category/product banners
 Product recommendations
 Thank You Email
 Coupon on next purchase/sharing
 Social media or other brand engagement channels
 Secondary CTA’s to shop

14. Post-Purchase Period
Talbots Thank You Email
Zappos Order Confirmation

15. Post-Purchase Period
Awaiting shipping
 Shipping Confirmation
 Product recommendations
 Loyalty program
 Sharing
 Promote sharing – social, forward to friend
 Manage Preferences
 Get more customer data for segmentation

16. Post-Purchase Period
MooseJaw Shipping
Confirmation
Backcountry Create Profile Email

17. Post-Purchase Period
After product received
 Product Review
 Store Review/Survey
 Recommended Accessories
 Product Manuals

18. Post-Purchase Period
Kate Spade Survey Email
Sephora Product Review Email

19. Post-Purchase Period
Best Buy Accessories Rec

20. Latent Period
 Regular email promotions
 Sitewide discounts, flash sales, shipping offers
 Content newsletters
 New products
 Behavioral emails
 Cart abandonment
 Site browse abandonment

21. Latent Period
National Allergy Cart Abandonment Email Lime Road Browse Abandonment Email

22. Repurchase Period
 Re-order Reminder
 Unique Offer
 Product-based Recommendations
 Accessories
 New similar products
 Complimentary products

23. Repurchase Period
Discount Beauty Center Re-Order Email

24. Win-Back Period
 Win-Back Series
 We’ve missed you
 Unique sweet offer + reminder
 Unsubscribe notice
 Unsubscribe
 If still dormant after win-back series, then suppress
permanently or unsubscribe

25. Win-Back Period
L.L. Bean We’ve Missed You
ShoeBuyWin-Back Discount Aerie Unsubscribe Notice

26. Loyalty Programs
 Hotels.com – free night for every 10 nights you stay
 Sephora Beauty Insider – gift cards, exclusive member
products, birthday coupons
 REI Membership – 10% annual refund, discounts in-store,
huge discounts on classes/adventures

27. Now Go Make Happy Customers
 It’s profitable to invest in customer retention
 Email marketing is a great form of lifecycle communication
 Great retention marketing doesn’t happen overnight, but you
can start today, implement 80/20, and then optimize