Amazon Prime Day has become almost as big a phenomenon as Black Friday or Cyber Monday, rivalled only by Alibaba’s Singles’ Day, which generated $25.3billion in sales in 2017.
With apparel and accessories now surpassing books and music to become Amazon’s second largest category, it’s no wonder that ecommerce brands are feeling the need to compete. In fact, 54% of retailers are standing up to Amazon Prime Day this year, by staging their own one-day sales. Retailers are even capitalising on Amazon’s wording, with nearly half of the largest non-Amazon retailers including the word ‘Prime’ in the messaging around their sales.
Shoppers in turn are responding to this, now viewing the day as a general retail holiday, rather than an occasion reserved just for customers of Amazon Prime, with 39% saying that they’ll look for bargains at other retailers. The introduction of another big discounting occasion in the calendar year may well bring a sales spike, but will it help retailers to win longer-term loyalty?
For 64% of retailers, shoppers acquired during Black Friday and Cyber Monday have a lower lifetime value than shoppers acquired at any other time of year. It’s reasonable to expect the same rules to apply to customers won on or around Prime Day or similar one day sales events. How can you make sure that those customers come back to make a repeat purchase, once the excitement of a sales day has passed?
- Make rewards available after the first purchase
Ensure that your loyalty program is designed in a way that allows customers to earn a reward immediately after their first purchase, or for creating an account. Customers who redeem loyalty rewards spend twice as much as those who don’t, so incentivise your newly acquired shoppers to get involved with your program and start the loyalty life cycle as soon as possible. It’s also worth making sure you award enough points for a first purchase or account creation that customers can redeem them on their next purchase, motivating customers to return to your store rather than looking elsewhere.
- Include your loyalty program in post-purchase emails
Most retailers will be sending post-purchase emails, whether it’s to say thank you for shopping on the sales day, or to let customers know that their delivery is on its way. Ensure that your post-purchase emails are enhanced to reference your loyalty program. If a customer has become a member as part of their purchase, let them know how many points are available to them and whether they have any rewards available. If they are not yet a member, let them know how many points they could have earned from their purchase, and what rewards that would equate to if they joined. That way, you’re giving them another reason to return before the next big sale.
- Run a promotion for customers acquired during Prime
If you’ve already used Prime Day to build excitement around your brand and your best-selling products, consider how you could use another event – such as a double-point week – to extend that excitement further. By making this promotion unique to customers acquired during the Prime Day sale, you not only make them feel part of something special, but you give them more reasons to come back and engage with your brand again. Customers who make a second purchase are over 50% more likely to make a third, so securing that second visit is key.
The jury is still out on the success of Prime Day, both for Amazon and other brands running sales off the back of it. However, the impact on customer loyalty is clear – simply running a sale won’t help you win retained customers that come back and repeat purchase. Ecommerce merchants should think carefully about how to capture the longer-term loyalty of customers that are acquired during a sales event. You can find more tips on how to win long-term loyalty in our new LoyaltyLion Academy, which includes 7 free modules designed to help merchants implement effective loyalty strategies.