Why B2C e-commerce brands focus on the post-purchase journey
In today’s e-commerce world, persuading a new customer to hit the ‘buy’ button is only half the battle. Once they win that initial sale, B2C e-commerce brands must work equally hard to retain their customer and prime them for the next purchase.
The focus on the post-purchase journey is based around the principle of Customer Lifetime Value (CLV), which posits that it costs up to five times more to win a new customer than it does to keep an existing one. Amazon used this method to hit its trillion-dollar valuation, and if an e-commerce brand wants to survive in an ‘Amazon World’, it must do everything it can to maximise CLV.
Businesses are increasingly recognising the value of the customer experience right before and right after the checkout process in achieving this. This is because consumers pay closer attention to e-commerce brands between the moment they click “buy” and the delivery of their product, than at any other point in their e-commerce journey.
However, currently most emails received after the checkout process are sent from middleware, shop or ERP systems with no UX strategy. As such, these emails are written in plain text, may contain confusing data and provide no contact points, relying instead on addresses such as “email@example.com”.
This has triggered demand for means to smooth out this back-end process. Brands are using CRM solutions to perfect frequency of communication, as well as channel planning & personalisation (e.g. through Ometria).
In addition, etailers are also investing in linkage solutions to match data between sellers and carriers/other fulfilment solution providers (e.g. parcelLab), ensuring the delivery process starts as early as possible.
These back-end solutions are also relevant to B2B e-commerce, as B2B solutions are often not user-centric enough and the systems they run on are less able to provide care immediately after the purchase process.
E-commerce brands use a combination of digital marketing techniques, technology, customer insights and psychology to keep consumers engaged and ready for their next purchase. In fact, B2B brands and etailers now also face similar opportunities and challenges. For B2C e-commerce, this includes using cookies to ensure ads regularly appear in a customer’s browser; providing an easy user experience through simple and clever web design; and encouraging social media shares to expose their brand to the customer’s network, contacts and friends.
The key to a happy online shopper is a transaction that is as ‘frictionless’ as possible. As such, investment aimed at streamlining fulfilment centres, logistics and delivery is essential. In the B2C world, Amazon has set the standard that others must meet, as customers are no longer willing to wait a week or more for their product.
‘Consumers, spoilt by loss-leader Prime, expect their goods to be on their doorstep within a day of ordering.’
Once the purchase is received, the best vendors ensure customers get the most from it by employing trained staff to answer queries, posting ‘how-to’ videos and pointing to how other customers are using the product or service.
Even if a customer decides to return a product, successful e-commerce businesses will provide a free, smooth process with a full refund, no questions asked. A painless returns process helps ensure that customers will consider buying from that retailer again.
E-commerce brands deploy a range of sophisticated, integrated communications techniques to keep their customers engaged post-purchase, including:
- Direct Mail
- Social media and video
- Mobile advertising and notifications
- Ambassador programmes and more
All these techniques help maximise CLV by keeping brands front-of-mind throughout the customer journey.
Smart e-commerce companies also turn customers into ambassadors for their brand. High-street fashion retailer Mango encourages customers to post pictures of themselves on Instagram and Twitter using the hashtag #MangoGirls. This is a smart use of real customers as well as influencers and celebrities to make Mango clothes even more desirable.
Meanwhile, Instagram and Facebook provide a shopfront or business feature which allows brands to add a click through option on photos to their online store and the clothing item or product the customer is interested in. Social commerce platforms also widely advertise on social media based on the accounts or hashtags followed by their target audience.
Perhaps the most effective key to maximising customer loyalty and CLV in 2019 is personalisation. Consumers reject one-size-fits-all, generic messaging and want brands to appeal to them on a personal level. Statistics bear this out:
Personalised promotional emails have 29% higher unique open rates and 41% higher unique click rates.
74% of marketing professionals say personalisation of emails improves customer engagement rates.
When multi-channel retailers personalise subject lines in promotional emails, open rates improve by 37%.
The most successful e-commerce brands use all the data available to them to communicate with their customers on a one-to-one level, for instance:
- Using first names in subject lines and the body of the email
- Customised recommendations based on past purchases and interests
- Social media advertising that aligns with their customers’ interests
Other examples of effective personalisation include ‘replenishment reminders’, i.e. letting a customer know that their product could be about to run out and encouraging them to buy a replacement; or sending birthday emails offering customers discount codes.
Since the key to effective personalisation is data, e-commerce brands collect as much information about their customers as possible, offering incentives for customers to tell them more about themselves. Investment in personalised marketing technology should see a financial as well as an engagement return.
The future of post-purchase strategy
Customer satisfaction and engagement is vital, especially when competing with Amazon. E-commerce brands are embracing new tactics and technologies such as Artificial Intelligence (AI), smart speakers, Augmented Reality (AR) and Virtual Reality (VR) and more to stay front-of-mind with their customers and maximise CLV.
Examples of brands using smart tech to boost brand engagement include Ocado, which has launched an Alexa-based ordering system, as well as Ikea, whose Place app uses AR to show customers how Ikea furniture would look in their home.
Ultimately, consistent and memorable branding is essential in all communication, no matter how high-tech it is. Combine that with investment and intelligent personalisation tools, and any e-commerce company can make an impact – even in ‘Amazon world’.
About Hampleton Partners
At Hampleton, we are aligned with our clients and look forward to helping them achieve success through M&A and growth finance, long into the next decade and beyond.
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‘Social commerce is skyrocketing to new levels, particularly on Instagram, Pinterest and Facebook.’