When should you start thinking about ecommerce customer loyalty?

The short answer to that question is day one. But for those of you wanting to look a little deeper into how ecommerce customer loyalty and retention will help your business grow, we’ve broken down our response to this question into three main points. These are:

  1. Throw off traditional views
  2. Customer loyalty predicts success, and
  3. Take advantage of seasonal spikes

Let’s take a look at each of these.


1. Throw off traditional views

The biggest mistake stores make when contemplating loyalty programs is that they wait until they feel they have acquired enough customers to start thinking about keeping them. This makes no sense. As a growing business, you have spent time and money marketing your products in order to acquire your customer base. So why would you ignore customers that have helped build your business? This traditional view of concentrating solely on acquisition is outdated and ultimately, harmful.

There’s compelling data to support this view. Gartner Group finds that 80% of all your future profits will come from just 20% of your existing customers. While Marketing Metrics states that:

“The probability that you will sell to an existing customer is 5 times higher than the probability of selling to a new customer.”


 2. Ecommerce customer loyalty predicts success

The future success of your business will most likely depend on customer loyalty so it’s a good thing to know this early.

The three main loyalty indicators are:

  • purchase frequency,
  • recency of purchase, and
  • referrals

You should start tracking these from day one. If you see a customer buying less often you know there’s something wrong and you should contact them. A comprehensive loyalty program will track these for you automatically.

If you don’t have enough data then simply call your customers for feedback, find out if they would buy from you again and if they would refer their friends. If the answer is yes to both of these questions, then you have the foundation for a successful long term business. Additionally, you’ll start building a strong relationship with your first customers.


 3. Take advantage of seasonal spikes

It may seem obvious, but taking advantage of seasonal spikes should be high on your list of priorities. Inputting a loyalty program before a seasonal spike will up your visibility as a market competitor, along with the more important factor of increasing repeat purchases over the duration of this period.

It is crucial that you continue to reward your customers after they have participated in your loyalty program during a seasonal high. Why? Well, if we take for example the recent Black Friday, you do not want to rely solely on the spike in your online or in-store traffic, only to see it burn out towards the end of the season and the run-up to Christmas. Seasonal spikes will help boost customer acquisition, but that will mean next to nothing by the end of the season if retention isn’t your focus.


If you would like more information on ecommerce customer loyalty contact our team at hello@loyaltylion.com and we can discuss how investing in retention will promote your store’s growth.

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