10 Ecommerce Customer Retention Strategies

Return customers increase your revenue and boost your reputation - but getting them to stick around is a challenge. Find out how in this article.

As a business owner, you know that acquiring a new customer can cost up to five times more than retaining an existing patron. More importantly, returning customers account for roughly 44% of the average business’s total revenue. 

Yet these customers only account for about 21% of a business’s total customer base. Put simply, if you can increase customer retention and keep people coming back, you can grow profits. We’ve put together a list of the top retention strategies to help you tap into that revenue.


What Is Customer Retention in Ecommerce and Why Is It So Important?

In ecommerce, customer retention is the number of customers that make repeat purchases from your brand. It’s usually expressed as a percentage, which you can determine by dividing the number of return customers by your total number of unique customers. For example, if you have 1,500 customers who have made two or more purchases with you and 10,000 total customers, your customer retention rate is 15%.

Having repeat business means more sales. According to an analysis from Gorgias, repeat customers actually generate 300% more revenue than first-time buyers. 

In fact, return customers account for 46% of orders despite being only 21% of total shoppers. That means there’s big money in repeat business. If you increase your customer retention rate by just 10%, you’d see a 3% increase in revenue. Boost retention by 40% and earn a 13% increase in revenue.

Plus, the cost of advertising and drawing in new customers is higher than ever. For example, research from Bain & Company shows that apparel companies need the average online shopper to make four purchases from one brand before they even turn a profit due to customer acquisition costs.

10 Ecommerce Customer Retention Strategies

1. Reward Loyalty

Loyalty rewards programs are a proven way to keep customers coming back. In fact, one survey found that 68% of customers say they’re willing to join loyalty programs. Ideas for loyalty rewards include:

  • Free shipping
  • Discounted products 
  • Birthday discounts 
  • Holiday discounts 
  • Free items with certain purchases

There are also benefits to offer that won’t affect your revenue. According to a Yotpo survey, 60.1% of people said they’re interested in early access to sales and 50.8% want early access to new products. Meanwhile, 38.9% say they’d like to get tailored offers and recommendations from a loyalty program.

2. Provide Frictionless Checkout

Customers want an easy checkout process - if they feel like completing a purchase is too complicated, they’ll ditch it altogether and may never return. According to data from Baymard, 17% of customers abandon carts because of a long or complicated checkout process. 24% will skip out on a purchase if the site wants them to create an account. 

You can easily avoid these issues by offering a smooth, streamlined checkout process. That means requiring minimal information from your customers. Typically, you only need their name, shipping address, payment information, and email. Provide a guest checkout option and make each step in the process obvious so you don’t lose any customers. 

You can also improve the checkout experience by saving payment information. When you use Pay.com as your payment service provider, customers can opt-in to save their card details for future purchases. That means our already simple checkout process is even faster for return customers, which keeps them coming back.

3. Upgrade Your Customer Service

People want to know that if they need help, you’re there to support them. A well-rounded approach to customer service makes the shopping process easy and leaves your customers feeling valued, which keeps them returning for more.

Look at your current customer service strategy and make sure it includes the following:

  • Knowledgeable customer service representatives available via multiple modes of communication.
  • Clearly posted contact methods and hours of service.
  • Minimal wait time for responses.
  • Self-service resources.

Aside from the above, a well-made website is also a form of customer service. Make sure your website is easy to navigate and has short page loading times. Optimize your site for mobile so that customers can shop from anywhere. Add detailed product photos and descriptions to eliminate questions.

4. Have a Post-Purchase Plan

Once a customer makes their first purchase, it’s vital that you continue the conversation. This is a limited window of time during which they’re still thinking of your brand and offering. Your post-purchase email campaign is where you establish communication and encourage shoppers to return. 

Be sure you’re sending the following after a customer makes a purchase:

  • A confirmation email with order tracking (for physical items). 
  • Any necessary instructions for use. 
  • An explanation of how to download and save digital downloads. 
  • A touch-base, encouraging questions and reviews after the customer receives the item.
  • An invitation to shop with you again, including an incentive, like free shipping.

5. Personalize Your Marketing

Personalization is becoming the norm. In one Salesforce survey, 66% of people said that companies should understand their unique needs and expectations. Meanwhile, 52% say they expect to receive personalized offers. The more you can tailor the shopping experience to each customer, the more they want to return.

There are a variety of ways you can personalize the shopping experience, even online. For example, you can use a customer’s purchase or browsing history to show them products similar to the ones they’re already interested in. You can use that information to upsell a more expensive item or add on complementary products. 

Likewise, you can use the same tactic in off-site communication, whether it's through email or SMS. Send personalized messages about products the customer left in their cart or new, similar products to those the customer has shown interest in.

6. Accept More Payment Methods

Today, there are far more payment methods than just cash, debit, and credit. Alternative payment methods (APMs) like Apple Pay, PayPal, and Klarna are becoming increasingly popular. Each APM offers different benefits, which drive customer loyalty. 

For example, shoppers love Apple Pay for its ease and security. They can quickly make a purchase just by double-clicking the power button and authorizing with FaceID. It’s secure since each purchase needs a password or biometric for authorization. 

Others love PayPal because it allows them to share their credit card details with just one site, but then pay for products across the internet. 

When you accept more APMs, you boost customer loyalty. In fact, 9% of shoppers will abandon a purchase if a brand doesn’t offer enough payment methods. People seek out brands that accept their preferred payment methods and shop with them more because of it.

7. Offer Subscription Discounts

By providing a subscription service, you can automate retention. It provides you with recurring revenue, and your customers don’t need to worry about restocking. 

Customers can be wary about agreeing to a recurring charge, so you’ll need to offer an incentive, like a 10% or 15% discount. Shoppers also want to see that they can easily cancel anytime or adjust the delivery timeline. 

Some products are well-suited for a subscription option. Snacks, drinks, and coffee are great options. Services like Spotify or ClassPass are also perfect for this pricing model.

8. Make Security a Priority

Customers need to feel safe when making a purchase with you. If they notice any red flags, they’re likely to abandon your brand entirely. Their initial impression of your security is your website, so make sure that your checkout page fits seamlessly with the rest of your site. 

Beyond that, your business must maintain PCI compliance to show that your systems are secure and you adhere to industry standard procedures to protect sensitive information. These standards can be a lot to manage, which is why Pay.com maintains Level 1 PCI DSS compliance for our clients. You can display the PCI DSS logo on your website to build customer trust.

It’s also best to use two-factor authentication to ensure that each customer is legitimate. Some security features are clunky and affect the user experience with annoying pop-ups. However, 3DS2 (3D Secure 2.0) is the latest in two-factor authentication and makes this security measure as frictionless as possible. 

9. Improve Your Shipping

Nowadays, Amazon Prime and other major players have made customers accustomed to free expedited shipping. It’s nearly impossible for smaller companies to compete with these expectations, but you can improve your shipping in select ways and boost customer loyalty.

First, consider working with a variety of carriers. This can allow you to offer a more flexible timeline. Plus, you can show the customer that they have several shipping options to choose from - putting them in control makes them feel empowered. 

Second, offer free shipping on orders of a certain dollar amount. Keep the minimum spend amount as low as possible to encourage repeat business. Free shipping on subscription orders can also be a great tradeoff for return customers. 

Lastly, be as transparent as possible. Don’t promise delivery timelines that you can’t guarantee. When there’s a delayed shipment, let the customer know as soon as possible.

10. Ask for Reviews

Reviews and testimonials are critical for businesses. People depend on social proof to help them decide where to spend their money, so having positive reviews can draw in new customers. Seeing that other people like the same products can bolster a sense of community for return customers, improving loyalty.

Plus, when a customer writes a review, it can improve their bond with your brand. Taking the time to think about what they like about your product or service reminds them why they purchase from you in the first place. 

You can easily get more reviews by including the request in your post-purchase email campaign. Make it easy by including links to the product page or third-party sites. Sweeten the deal by offering a discount on future purchases.

What's the Best Way for an Ecommerce Business to Accept Payments? 

Another key way to keep customers coming back? A smooth checkout process. Pay.com provides a powerful payment system that includes a seamless checkout experience for customers, and a variety of useful tools for you. 

You can use our developer-friendly APIs to add hosted payment fields to your website - allowing you to keep customers within your environment from start to finish. 

Adding payment methods to your website is easy. In fact, you can get it done with the click of a button on the Pay Dashboard. Choose from major credit and debit cards, digital wallets, bank transfers, and more. Plus, you can give your customers the option to save their payment details, making purchases even easier and driving up retention.

Security is a top concern for businesses and customers alike. For business owners, though, it can also be a pain to maintain. That’s why Pay.com takes care of all payment-related security measures for you. We maintain Level 1 PCI DSS compliance, using advanced security tools like tokenization, encryption, and two-factor authentication to protect customer data. 

Click here to sign up for Pay.com now!

The Bottom Line

Your customer retention rate is a critical metric for business growth. If you can increase customer retention, you can boost sales and save money on drawing in new shoppers. With so many brands to choose from, it’s important that you stand out with an abundant retention strategy, including a loyalty program, subscription options, and excellent customer service.

Improving your overall customer experience is vital to ensuring people want to shop with you again. One of the key ways you accomplish this is by offering a seamless checkout process. With Pay.com, you can accept more payment methods, provide secure transactions, and deliver an easy checkout experience every time. 

Click here to get started with Pay.com now!


How can an ecommerce business accept multiple payment methods?

You can easily start accepting more payment methods by switching to Pay.com. Our payment system supports a variety of payment options, including customer favorites like Apple Pay, PayPal, Google Pay, and major credit cards. Click here to find out how you can get started.

What is a good customer retention rate for ecommerce?

Realistically, ecommerce businesses can expect to have a 20% to 30% customer retention rate. However, a rate of 30% to 40% is excellent.

What are the top 3 customer retention strategies?

The top retention strategies are:

  • Provide an excellent customer experience 
  • Have a strong post-purchase email campaign
  • Offer a robust loyalty program

What elements should an ecommerce checkout process include?

Your ecommerce checkout process should be as straightforward as possible, asking for minimal information. It should allow the option for guest checkout. It also needs to have clear security measures in place, like PCI DSS compliance and two-factor authentication. Plus, it should allow customers to save their payment information for future purchases.

Meet the author
Ginny Dorn
Ginny Dorn is a finance and business copywriter specializing in credit card processing and fintech. She graduated from Western Illinois University with a bachelor's degree in family and consumer sciences.
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