Daily ArchivesNovember 7, 2022

Marketers know that first impressions are everything, especially when it comes to ecommerce. Although positive early interactions with customers are important, the interactions following that initial contact are just as critical.

It’s those repeated interactions that build brand loyalty, encourage repeat purchases, and create long-term relationships with customers. Laying a solid foundation from the beginning can increase your customer retention, and help position your brand as one that takes care of customers.

But how do you make sure you’re reaching your customers at the right time? What’s an optimal way to engage with customers that will yield the best ROI?

An email marketing strategy is a powerful way to build those long-term relationships with customers and boost your customer retention. In fact, a study from McKinsey & Company found that the emails prompt purchases at a rate that is at least three times higher than social media.

Of course, it’s important to engage with your customers through multiple channels, but creating a bulletproof, results-oriented email marketing strategy should be high on your priority list.

How an Email Marketing Strategy Boosts Customer Retention

Let’s first examine what makes an email marketing strategy so effective.

1. Email helps keep you top-of-mind: Sending your customers regular emails that have intention and value keeps you fresh in their minds.
2. It’s cost-effective: When executed properly, email is a highly effective, cost-efficient element of a larger marketing strategy. According to DMA, a UK-based marketing research association, marketers can expect to make $43 for every $1 they spend on email marketing. That adds up quickly.
3. Connect with customers in a better way: Email marketing allows you to connect with customers on a level of the customer journey that you may not get with other channels. After all, who doesn’t like opening up emails with discount codes, or receiving early-access to sales from one of their favorite brands?

In short, strategy works.

So what does this look like in practice? Let’s take a look at a few email marketing strategies that will help your retention rate and build those valuable long-term customer relationships.

Personalization

You’ve likely read about the dreaded email marketing flubs of misused personalization that seem to happen all too often. Misspelled names, formatting errors, or perhaps the worst of all — forgetting to fill in the “name” field, resulting in something like this:

Hey, {First_Name}! Thanks for your purchase.

No company wants to be that company. Go beyond simple first name personalization.

For example, product recommendations based on customer shopping behavior, links to relevant articles on your blog, content specific to different geographic locations, and even customized cart abandonment emails can help set your brand apart.

This cart abandonment email from David’s Bridal serves as a nudge for customers to return to their cart. It also encourages them to buy right away by offering 15 percent off their purchase.

Provide Value in Every Email

An excellent way to instantly stand out in the sea of emails that flood your customers’ inboxes is to give them something of value in every email you send. From discount codes and pre-sale access to product updates and relevant blog posts, always provide your customers with something they want.

If you give your customers something of value, it’s likely they’ll share it with their followers and friends. Some companies find that their email subscribers are three times more likely to share content via social media than website visitors from other sources. Every email is a valuable opportunity to drive social sharing. So if your email doesn’t provide something that is going to either help build your relationship with your customers or encourage them to convert, rethink your strategy.

Choose Your Send Date and Time Wisely

The best time to send an email is unique to your customers and their behavior.

Sure, there are definitely some better times to send an email than others, but making that decision based on your customers’ behavior is the “golden ticket.”

Run a split test on a few campaigns and see if you can identify any patterns in open rates that correlate with the time of day and day of the week. Testing and seeing firsthand when your customers are opening your emails is the only true way to determine what will work best.

Make Sure Emails Are Mobile-Responsive

This seems like a no-brainer, but if your email isn’t suited for mobile devices, consider it moved to the trash folder. Mobile devices account for about 46 percent of all email opens, followed by webmail opens at 35 percent, and desktop opens at 18 percent.

Most email marketing platforms allow you to preview your email on different devices, so work out any formatting kinks before you hit send.

A/B Test Subject Lines (And Everything Else While You’re At It)

A/B testing, also known as split testing, is an integral part of any email marketing strategy. As we mentioned above, it’s important to A/B test different variables of your email so you can optimize to the fullest.

Examples of variables to A/B test include:

• Subject lines
• Copy and headlines
• CTAs (call-to-action)
• Imagery
• Email send time and day of the week
• Offers
• Personalization elements
• Format and layout

A/B testing should be done regularly to ensure you’re making the best decisions regarding your campaigns, and your customers see variables that will move them toward converting.

Be Strategic With Your CTAs

It’s essential for every email to include a call-to-action (CTA) that tells customers what they should do next. According to Campaign Monitor, using a CTA button instead of a text link can increase conversion rates by as much as 28 percent.

Optimizing your CTAs — whether it’s by design, copy, color, size, or placement — can help boost your conversion rates, which plays a significant role in customer retention. A great way to understand the impact of your CTA placement is by split testing.

Keep these tips in mind when designing and testing your CTAs:

1. Make your CTA stand out, whether that be with size, color, or placement in the email
2. Include action-driving copy (e.g., “Create your unique shampoo” or “Build your kit”)
3. Keep it short but clear
4. Create a sense of urgency
5. Use eye-catching colors

Be intentional with your CTAs to ensure clarity and follow-through.

Segment Your Subscribers

Segmentation is a powerful email marketing strategy that makes it easier than ever to ensure your customers are seeing the right content, landing pages, and products. According to DMA, 76 percent of email ROI comes from segmented and triggered emails.

Every customer has their unique interests, budget, and shopping habits, so reaching them at just the right time can help you increase conversions and customer retention.

Segmenting your customers gives you the opportunity to send specific discounts easily, thank customers for their purchases, and reward them. Also, that layer of customization can help you stay out of your customers’ spam folders.

Surprise and Delight Your Customers

Who doesn’t love getting discount codes or freebies delivered to their inbox on their birthday or just because? Sending customers promotions they may not be anticipating or that aren’t the usual sale announcements shows customers that you care.

For example, Native, a deodorant manufacturer, sent the following email to everyone who had been on their email list for a year.

Instead of a routine Thanks for being a Native customer, they emphasize the added value of a discount to email list members.

This initiative from Native not only surprises the customers and encourages them to make a purchase, but it also adds a layer of personalization.

Leverage Reviews and Collect More Customer Data

It’s no secret that testimonials and product reviews are essential to your business, but obtaining them can be tedious and not always successful — especially if you ask customers too long after they’ve made their purchase.

Amazon is the king of product reviews and recommendations, and it’s a significant component that fuels their business. This follow-up email is a great example.

The email clearly shows the recently purchased item and makes it easy to rate the product. There’s even a call-to-action at the bottom that nudges the customer to review other purchased products.

Collecting testimonials and reviews can be a daunting process, but thanks to automation, you can easily collect the data about your customers that will help you personalize your marketing efforts in the future.

Know Your Customers

Strategic, intentional email marketing strategy that caters to your customers based on their unique behaviors and demographics can make a significant impact on customer retention.

Leverage the data you have, and work on collecting more that you can use to enhance your customer experience.

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Subscription box services are popular among consumers today. Hellosubscription.com lists more than 5,000 subscription services selling everything from sneakers to vaping supplies. It’s no surprise. These services are convenient, cost-saving, and personalized. Here are some quick subscription box stats from a 2018 McKinsey study:

• 15% of online shoppers have signed up for a subscription box service
• Most popular among younger, affluent urbanites
• Sales in 2016 were $2.6 billion, up from $57.0 million in 2011
• Women make up 60% of all subscribers
• Nearly 35% of subscribers have 3 or more subscriptions

What Is a Subscription Box Service?

Subscription box services ship their subscribers products, services, or exclusive content at specified intervals (usually monthly) in exchange for a recurring payment. Subscription services fall into three broad categories: replenishment, curation, and access.

• Replenishment subscriptions ship products that customers need to replace on a recurring basis (e.g., beauty products, razors).
• Curation subscriptions offer customers more than just products. They strive to surprise and delight them with new offerings personalized for them. (e.g., fashion, dog toys, tea).
• Access subscriptions give customers low prices, membership, perks, and special access. (e.g., Walmart’s Beauty Box and Amazon’s Subscribe & Save)

Some eCommerce platforms let you easily spin up a subscription box service for a monthly fee, but they don’t give you the flexibility to customize your site.

Other subscription services like Patreon are popular among artists and influencers who offer exclusive content to channel subscribers, but they quickly eat away at your profits with high transaction fees and monthly charges.

However, if you already have a WordPress site, the WooCommerce plugin is flexible, free, and easy to install. Here are the steps to starting your own subscription box service with WooCommerce.

Step 1: Choose a WordPress Theme

If you don’t have a WordPress site yet, find one with WooCommerce integration like Astra, which is a free theme. Of course, you can pick any theme you want, just make sure your theme has these features:

• Responsive design
• WooCommerce integration
• Layout and color customization
• Clean, simple interface
• Loads quickly

Step 2: Download the WooCommerce Plugin

WooCommerce is a WordPress plugin that transforms your site into a powerful eCommerce platform. Like WordPress itself, WooCommerce is open-source, which means it’s flexible and customizable. No matter what subscription box product you’re selling, you can use WooCommerce extensions to suit your marketing and sales. Follow these steps on how to add a WooCommerce store to your WordPress blog.

Of course, if you use our Managed WooCommerce Hosting plans, you don’t need to do this step; you can skip it completely.

Step 3: Add Subscription Functionality

You need a way to manage your subscriptions and collect recurring payments. You can use WooCommerce Subscriptions to set up automatic payments through multiple payment gateways like PayPal or Stripe. You need a subscription manager with features like these:

• Offers both automatic and manual renewals
• Offers a billing schedule to fit your subscription model (weekly, monthly, yearly)
• Automated emails reminding customers when their payment will process
• Customers can upgrade or downgrade their subscriptions

Your monthly revenue is more accurate and predictable when you automate renewals and streamline your subscription management. For this reason, we highly recommend defaulting to automatic renewals.

Subscription Box Pros and Cons

The market for subscription box services has grown by more than 100 percent every year for the past five years. So, it’s a proven profitable eCommerce model. But it’s not an online model without challenges. Here are few to keep in mind.

Revenue

As with any subscription service, revenue is fairly predictable. Customers sign up for a contracted period of time for a specific amount. Predictable revenue helps you confidently plan other parts of your business like shipping, space rental, and hiring employees.

However, subscription box services are notorious for their high customer churn. More than a third of customers cancel their subscriptions in less than three months and more than half cancel within six.

So while subscription models are predictable, subscribers are not. Cut down on customer churn by offering discounts to those who sign up for a long-term subscription (e.g., yearly instead of monthly).

Shipping

Subscription box services like Tinker Crate lower their shipping costs by standardizing box sizes and shipping times. Unless you’re shipping dumbbells one month and silk flowers the next, you can use the same type of box every time. This will help you estimate shipping costs more accurately.

But standardizing your box size also means you’re limited to what products you can offer. If your customers get a different selection of products each month, then you’re limited to the size and number of products that will fit in your box. You may need to change your box size as your business grows.

Customer Experience

Profitable subscription box services like the men’s shaving supply merchant Harry’s are convenient and cost-effective. Customers get to skip the cramped aisles at brick-and-mortar stores and save money. It’s an attractive value proposition.

However, when perceived value drops or convenience lags, customers are quick to drop your service. They demand a superior end-to-end customer experience, which means keeping costs low while delivering quality products on time.

For curated services offering different products every month, part of your customers’ perceived value will be in how often you surprise and delight them. That means sourcing unique products and personalizing shipments with surveys and questionnaires. The less personalized the service, the more cancellations you’ll have.

Your customers want to feel like they’re getting a gift each month that surprises them. If your box contents aren’t that “fun,” try including original content like a magazine about your products (e.g., wine subscription pamphlet) or something fun and educational (e.g., a “bathroom reader” for your men’s shaving supply service). The anticipation of what’s in the box delivers joy and delight—don’t forget to pack that value into your boxes, too.

WooCommerce Subscription Box Examples

Here are a few subscription box companies that bring personalization, flexibility, and convenience to their subscribers.

CineCrate

Subscription Model: CineCrate is a curated subscription box for kids interested in filmmaking. A subscription costs $39 per month, and subscribers get a themed CineCrate with a costume, prop, and other movie-making materials. The CineCrate WordPress site runs on WooCommerce and WooCommerce Subscriptions.

Personalization. Like other subscription box services aimed at children, CineCrate founders Stephanie Brogan and Lizzy Montana have to find unique and creative ways to personalize their customers’ experiences.

Brogan explains, “We have to make sure that the products we include are unique and inspire creativity. We have to find clever ways to fit each item together within the box.” To build a theme for their various items, CineCrates uses movie genres like superhero movies.

But to push personalization further, CineCrate owners include a customized workbook for brainstorming character development, storyboarding, and writing their scripts. “By including the workbook and activities to pair with our box items, it helps our subscribers use their creativity to make their movie making more personalized,” Brogan says.

The workbook balances the guidance a child needs with the freedom of expression to personalize the experience.

Brogan says the biggest challenge the company has faced so far is keeping costs low while ensuring quality products. CineCrate uses standard box sizing (12x9x2 inches) to lower shipping fees and bulk-buying to lower product costs.

Driftaway Coffee

Subscription Model: Driftaway Coffee is a curated subscription box service for coffee connoisseurs. The subscription works on a “bean-to-cup” marketing approach where subscribers can leave coffee bean farmers feedback on the taste and quality of their coffee.

Order Flexibility. Driftaway offers an impressive level of order flexibility. Customers can choose among four subscription plans based on the weight, three different delivery preferences (weekly, 2 weeks, or monthly), and two different billing frequencies (per shipment or 6 months).

By giving customers this level of cost customization, Driftaway maximizes customer retention. Customers can order as much as they want or can afford. As such, customers are less likely to feel locked into their monthly order—compared to a service with the same shipping weights or number of products each month.

Making Customers Part of Something Bigger. Driftaway excels at giving customers a complete end-to-end experience. Subscribers can participate in a World Coffee Research organization. The WCR helps research and develop hardier strains of coffee beans, helping local farmers avoid financial losses from diseases, pests, and drought.

Driftaway’s feedback and researching funding programs place their customers within the entire ecosystem of bean production. The company sells more than coffee to its customers. It sells the idea of community—a notion that makes customers feel like they’re part of something larger.

Subscribe to Your Own Ideas

It may feel like the subscription box market is saturated, but there’s plenty of room for creative entrepreneurs who find niche markets or unique opportunities. If you’ve already got a website, think about how you can use your resources and connections to reach an untapped market.

• Are you a musician with a website? Then start a subscription box service for your music. Offer it in downloadable MP3s or CDs every month for a small subscription. It’s a great way to promote your art and connect with current fans.
• Are you a fashion influencer? Start a curated box service filled with hand-picked selections of your sponsors’ products.
• Are you a music blogger? Then start a record-of-the-month club where you ship new musical experiences to your subscribers.
• Are you a hiker with a social following? Create a monthly “Hiker’s Snack Box” filled with nutritional goodies for high-energy sports.
• Are you a YouTube makeup artist? Then work with brands you love to assemble sample palates for a monthly subscription box.
• Are you a podcaster? Create a “box” with access to exclusive content and fun swag related to your podcast, like shirts, stickers, patches, and sponsor products.
• Are you a mom blogger? Put together a kit with crafts for keeping kids busy, recipe cards that feature your sponsors, and samples of your favorite products.

When it comes to subscription box services, there are still plenty of creative ways to start a business. The real challenge is maintaining value for your customers. If you can personalize their experience while keeping selections surprising and fresh, you’ll be more than halfway to building a profitable subscription box service.

Managed WooCommerce Hosting Can Get You Started

Whether you plan to make and ship your own subscription box products, or you plan to sell existing products, we have managed WooCommerce hosting plans just for you.

Check out our plans to get started today.

Like Dr. Frankenstein, we tend to overlook flaws in our own creations. So, if you suspect your ecommerce website is a bit slow, it’s probably seriously under-performing. That’s okay because there are plenty of options to fix the problem—and a serious problem it is. Here are some eye-opening stats about site load speed:

• 47% of customers expect web pages to load in 2 seconds or less
• 57% of visitors will leave your site if load times are longer than 3 seconds
• Of those 57% who leave, 80% will never return to your site
• Of those 80% never-returners, 44% will tell their friends about their bad experience

These stats read like the slow death of an under-performing ecommerce site. Customers are impatient and have high expectations. When those expectations aren’t met, they leave and never return. Then, they go out of their way to tell friends and family to avoid you. This cycle spirals as your traffic slows, visitors stop converting, and your revenue tanks.

Your site’s load speed and page load times are the bedrock on which you build your conversion rate optimization (CRO). Your product page might be flawlessly designed, but if it doesn’t meet the expectations of an impatient customer anxiously holding their credit card, it won’t get you the sale.

How Website Speed Affects Your Conversions

The purpose of CRO is to streamline your marketing and web design to get visitors to convert to customers. It’s about enticing them to click, follow, like, or download, and removing hurdles to those actions. Your conversion rate is a measure of the effectiveness of this strategy, and your site load speed has a tremendous impact on it. Here are a few problems you’ll encounter with slow page load speeds.

Higher Bounce Rates

When your page load times are slow, your carefully constructed site architecture designed to funnel traffic to product pages is full of twists, turns, and barriers. If your home page loads in a snap, but the product page takes twice as long, the inconsistency is annoying to customers. Instead of waiting, visitors will hit the back button or close the browser window, and you’ve lost a potential conversion.

Too many of these swift exits will increase your bounce rate. Google interprets bounces as a signal that your content isn’t relevant and will push you down in search results. Over time, this adds up to lower traffic rates and fewer conversions. To get the lowest bounce rates, studies show you need a load time that’s under 1.2 seconds.

Shorter Session Lengths

Sessions are a measure of visits, not visitors. So the metric is always higher than total unique visitors because each visitor can have more than more session. Lower sessions mean visitors are returning to your store fewer times. There are many reasons for this—seasonal trends, shifts in organic rankings—but a major cause is slow site speeds.

An Akamai report showed that a 2-second delay in page load speeds correlates to a 51% decrease in session length. Fewer return visits mean fewer opportunities to expose visitors to your brand or products—oh, and fewer conversions.

Lower Brand Sentiment

Visitors who bounce from your store because of slow load times won’t keep it to themselves. They’ll tell friends about the time they wasted trying to use your site.

Website performance is a big part of the first impression you make to visitors—and that impression is highly contagious. Word-of-mouth recommendations or warnings are powerful influencers, and ecommerce businesses rely on them to bring in new customers and retain current ones.

Lower Investment for CRO

Performance studies estimate that for every 1 second it takes for your ecommerce site to load, your conversion rate drops 7%. If we assume all conversions are sales, that would total $25,000 in annual revenue loss for a store that brought in an average of $1,000 per day.

Not only is that lost revenue for you, but it’s also less money you have to re-invest in social media ads, email campaigns, and all of the other marketing strategies that underpin your CRO.

If you can’t invest in conversions, your customer base won’t grow, which means your profits won’t either. It’s difficult for small ecommerce businesses to escape the pull of this negative feedback loop. Avoid it by maintaining good website performance from the get-go.

How to Increase Your Page Load Speeds

While there are many ways to improve your conversions, speeding up your website performance should top your CRO list. Here are some ways to get those product pages popping up in front of customers quickly.

Test Your Site’s Speed

First, see how slow your site really is. Use a website performance tester like GTMetrix to identify your biggest problems. The service will analyze your page speeds, give them a grade, and suggest fixes.

Optimize Your Media

Even though images and videos can improve your CRO, you pay the price in longer page load times. So, make sure you optimize your images and compress your videos for the web.

When media is optimized, your server can push out files faster and your pages will load quicker. Instead of relying on HTML or CSS to resize your images, upload them at the smallest sizes you can get away with.

Leverage Browser Caching

If optimizing and compressing your media isn’t boosting your website performance, have your developers leverage browser caching. Browser caching stores frequently used data on your customer’s memory for a short period of time. So, when they visit your site again, the data is already stored locally, making it load faster. Ask your IT team to enable browser caching or try a WordPress caching plugin.

Clean Up Your Code

Minification is the technique of “cleaning” your code—eliminating all of the spaces and extra characters you don’t need. Use minification to clean up your website’s source code and make it run faster. Although minification removes characters and spaces, it doesn’t alter its function—just tidies things up a bit. You can minify your code with online compressor tools for CSS and HTML.

Get a Content Delivery Network

Internet traffic flies through thousands of miles of network cables, flying through space, and around the planet. The farther customers are from you, the longer it takes to load content for them.

Content delivery networks (CDNs) are strategically placed servers that help speed up delivery by storing your cached web files closer to your customers. The shorter distance means CDNs load your pages faster, even for customers that live halfway around the world.

Avoid Landing Page Redirects

When you have redirects on a landing page, it delays the page load as the redirect processes. And your customers wait. If you have a redirect, have it execute on the server side instead of the client side. This reduces client-side round trip requests.

The time it takes for your customers to send a request and your server to send a response is called the round-trip time. Keeping HTTP redirects from one URL to another at a minimum cuts out additional round-trips, which means shorter wait times for your customers.

Use Lazy Loading

When a customer opens one of your product pages, the entire page’s content is downloaded, rendered, and cached. That includes all of the products on that page, which could include dozens of images. However, there’s no guarantee that the customer will view all of these images. They may only look at what’s “above the fold” of the page, without scrolling down. But all of that data has to be loaded anyway. This adds to your load times.

Lazy loading is a web design strategy for saving precious loading resources by delivering only the images and text that the customer needs. Website platforms like WordPress feature lazy loading solutions like Infinite Scroll that continuously load content as the user scrolls down the page. Similar lazy loading plugins exist for ecommerce platforms like WooCommerce.

Enable GZIP Compression

Any file your server sends to a browser can be compressed before delivery. Compressed files are transferred faster, cutting down on bandwidth usage and increasing page load times. Run a GZIP compression test to ensure things are running smoothly. And have your IT team configure your server to return zipped content when possible.

Choose a Dedicated Hosting Plan

If you really want to affect your website performance find the right host for your ecommerce needs. The right host serves as a website speed optimization service because it continually monitors your performance and automatically adds resources when they’re needed.

Often, smaller ecommerce sites choose shared hosting plans because they’re inexpensive. However, the trade-off is in speed. Check to see if you’re on a shared server hosting plan. If so, you’ll want to switch to a managed hosting account that’s optimized for your ecommerce platform. If you have an IT team, choose a virtual private server or dedicated server set up.

Improving your website performance is challenging but worth the effort. Don’t feel like you need to implement all of the changes at once. Optimization will take some time.

Locate the issues that are having the biggest effect and tackles those first. If you have an IT team, most of these are easy fixes. But even if you take on the task alone, remember your conversion rate depends on delivering content to match the speed of your customers’ expectations, not your own.

Managed WooCommerce Hosting Is Build For Speed

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Loyalty is practically its own form of currency, especially for ecommerce stores. When customers are loyal to your store, they offer greater customer lifetime value (CLV) which in turn, generates more revenue for your business.

If you want your ecommerce store to be as successful as possible (and who doesn’t?), measuring customer loyalty with key customer retention metrics will show you how many of your customers are coming back to your store again and again. With that data, you can make smart improvements to your business to further boost customer loyalty.

Let’s take a closer look at how customer loyalty and customer retention are related and which key customer retention metrics you can start using right now to gauge and track your customer loyalty.

Customer Loyalty & Retention

Customer loyalty is a term used when a customer continues to buy from a particular brand, company, or business. It results from positive experiences and interactions with your business.

The main implications of customer loyalty are:

• Loyal customers generate more referrals.
• Loyal customers will continue buying from you.
• Loyal customers aren’t actively looking for alternate suppliers.
• Loyal customers are less susceptible to competitors’ marketing.
• Loyal customers are more receptive to your other products and services.
• Loyal customers are more understanding of issues and troubleshooting.
• Loyal customers are more likely to provide feedback and reviews which you can use to improve your retention.

Customer retention is your ability to sell to customers who have already made purchases from you. It’s a unique metric because it accounts for both your ability to acquire new customers as well as your ability to keep those customers. In short, your retention metric is about turning new customers into repeat customers which makes it a useful metric to measure and track.

The Importance of Retention

Retaining a solid base of loyal customers is highly profitable. For one thing, returning customers spend up to 67 percent more than new customers. And when you consider the high cost of marketing, acquiring new customers is on average, 6 to 7 times more expensive than retaining your current customers.

Most businesses see an average of 25 to 40 percent of total revenue coming from their returning customers. However, it’s estimated that a mere 5 percent increase in retention can result in a revenue increase of between 25 and 95 percent, so customer retention is an invaluable metric that happens to be particularly useful for measuring customer loyalty.

What Influences Retention?

Price influences retention in an obvious way. When your products or services are priced competitively, your customers are more likely to come back when they need your offerings in the future. However, if your prices are too high, they’ll be unlikely to buy from you again.

Site performance is an easily overlooked but major influence in retention. If it’s difficult to navigate your website, the checkout process is buggy or confusing, or the site is slow, customers will likely give up and simply find what they need elsewhere.

Delivery refers to how quickly you ship orders, the speed of delivery, and how much you charge for shipping. If you charge too much for shipping or if it takes too long to deliver orders, customers are unlikely to order from you again.

Customer service can either boost or reduce your retention. Strong customer service can be reassuring to customers who are considering buying from your store.

Loyalty programs have become a great way of encouraging repeat business. In effect, a loyalty program rewards your customers for their patronage and offers an incentive to make additional purchases in the future.

Saved payment details is one you may not have expected, but being able to store payment details for future purchases is a huge convenience for online shopping. With many people making purchases on mobile devices, it’s inconvenient to input payment details for every transaction. Plus, offering the ability to store payment methods for future use significantly reduces cart abandonment rate.

Retention Metrics for Measuring Customer Loyalty

Customer retention measurement is important as it offers a way of measuring customer loyalty. Fortunately, there are a number of useful retention metrics with which you can measure the loyalty of your customers.

Customer Retention Rate (CRR)

Your customer retention rate, or CRR, is the quintessential customer retention metric and an ideal place to start measuring customer loyalty. Basically, your customer retention rate reflects the percentage of customers who remained loyal over a specific period of time.

Customer retention rate is important because it offers a quantitative interpretation of a qualitative attribute. If your rate is low it means you’re keeping fewer customers, and customer loyalty is low; however, if your retention rate is high, more customers are loyal to your business.

Though 100 percent retention is the ideal maximum, all businesses see some amount of customer loss, or churn. Studies have shown that while it varies from industry to industry, the average retention rate usually falls below 20 percent.

Customer Retention Rate Formula

You need three data points to calculate customer retention rate: number of customers at the start of a period (CS), number of customers at the end of a period (CE), and number of customers acquired during that period (CA).

To calculate, subtract CA from CE, divide that number by CS, then multiply that figure by 100 to convert it into a percentage.

How To Improve The Customer Retention Rate:

1. Set realistic expectations. If you make promises to customers that you might not be able to keep, they’re unlikely to become repeat customers.
2. Implement anticipatory services. If your ecommerce store offers services, send reminders for upcoming invoices. If you can anticipate your customers’ needs, it shows your customers that you’re on top of things.
3. Set (and monitor) your team’s key performance indicators. Use key performance indicators (KPIs) to monitor the performance of your employees. If customer retention rate and your team’s KPIs are low, improving customer service with some behind-the-scenes improvements could boost customer loyalty and retention.
4. Leverage social media. Interacting with your customers one-on-one on social media or through email is how you build relationships, which inspire loyalty and retention.
5. Solicit feedback from customers. Surveys can be a great way of gauging customer experience. If multiple customers mention a problem or shortcoming, addressing the problem could boost customer retention rate.

Customer Churn Rate (CCR)

Customer churn rate, or CCR, represents the ratio of customers you acquire and lose soon thereafter. Customer churn rate and customer retention rate are like two different sides of the same coin; the churn side represents customers lost over a period while the retention side represents customers retained over a period.

Your churn rate — also called attrition rate — is a great metric for gauging customer loyalty. A low CCR is indicative of higher customer loyalty because there are fewer customers lost, but a high CCR indicates a larger percentage of customers lost and implies lower customer loyalty.

Customer Churn Rate Formula

There are two ways to calculate the customer churn rate. The first way is to piggyback off your customer retention rate because, in essence, customer churn rate is your retention rate subtracted from 100 percent.

Alternately, CCR can be calculated using a simple formula that requires just two data points: the number of customers at the start of a period and the number of customers lost over that period. To calculate, you simply divide customers lost by the number of customers at the start of that period, then multiply that value by 100 to get the percentage.

Customer Lifetime Value (CLV)

Of all the retention metrics we’ll cover, customer lifetime value is arguably the most important to measure, but it also happens to be one of the most confusing to calculate.

Customer lifetime value indicates the health of your store by showing you how much your customers are spending during their customer lifecycles. When your customers are loyal, they tend to spend more at your ecommerce store, yielding greater lifetime value.

In theory, it sounds like it should be a simple thing to calculate, but it requires you to know a number of other metrics for your ecommerce store.

To calculate customer lifetime value, multiply the amount of money the average customer spends per year by the average customer lifespan. This will give you a value for how much revenue on average you should expect from every customer over his or her lifecycle.

Repeat Customer Rate

Ultimately, loyal customers are the ones that make multiple purchases. Therefore, it follows that your repeat customer rate would be a great measure of customer loyalty.

Your repeat customer rate is simply the percentage of your customer base that has made more than one purchase. To calculate your repeat customer rate, divide the number of customers who have made multiple purchases over a period of time by the number of total customers for that same period, and then multiply by 100 to get a percentage.

Though repeat purchases don’t necessarily equate to loyalty, the likelihood that a customer becomes loyal to your ecommerce store grows with every purchase.

Upselling Ratio

The most loyal customers are receptive to products in addition to the one they intended to buy. For instance, if a customer goes to your ecommerce store for a specific type of item and ends up buying both the intended item and an item from a totally different product category, there’s a strong indication the customer is loyal to your store.

So your upselling ratio is a measure of customers who were “upsold” and added unrelated products to their orders, against the number of customers who bought only one product. The formula is the number of customers who made multi-item purchases divided by the number of customers who made single-item purchases.

Retention Metrics for Loyalty Programs

Loyalty programs offer lots of opportunities for using retention metrics to gauge customer loyalty. The idea behind customer loyalty rewards programs is to retain more customers by giving them incentives to make additional purchases. So if your loyalty program isn’t performing very well, it’s a strong indicator of poor customer loyalty.

Participation Rate

When you offer a loyalty program, your participation rate is the percentage of your customers who are enrolled in your customer loyalty rewards program. To calculate your participation rate, divide the number of customers who are enrolled in your loyalty program by your total number of customers.

Redemption Rate

Redemption rate is a metric that indicates the success of your loyalty program. Basically, the idea is to determine what percentage of your loyalty program participants are actually using the perks that are offered or earned through the program. Calculating your redemption rate is quite simple: Divide the number of perks redeemed by the number of perks issued.

Active Engagement Rate

Similar to the redemption rate, your active engagement rate reflects the percentage of your total customers who are engaging with your loyalty program. The formula for active engagement rate is the number of customers who have used your loyalty program divided by your total number of customers.

Use Retention Metrics to Gain More Loyal Customers

To be clear, this isn’t an exhaustive list of retention metrics. While every metric is illuminating for one reason or another, we focus on the retention metrics that are most directly tied to customer loyalty to allow you to get a read on how many of your customers will come back to your ecommerce store again and again.

While some of the metrics we’ve highlighted may not be relevant to your business — like the metrics for loyalty programs — most referenced here will give you a solid start in measuring customer loyalty. As you use these metrics to gauge and track customer loyalty, you’ll recognize the importance of cultivating loyalty from your customers for the longevity of your ecommerce business.

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The world of ecommerce has evolved.

More and more retailers have jumped onto the ecommerce bandwagon which in turn, has created more competition for consumer transactions. As a result, we’ve seen new models of online retail emerge, such as dropshipping.

Maybe you’ve even heard of it before, but does dropshipping work? And is it a good business decision?

What is Dropshipping?

Dropshipping has emerged as an alternative to conventional ecommerce that allows retailers to collect orders from customers before passing those orders to distributors and suppliers for fulfillment.

Basically, the use of dropshipping gives retailers a workaround, saving them from many of the difficulties associated with maintaining inventory and having to implement your own fulfillment process.

The Pros of Dropshipping

As you can imagine, there are a lot of benefits to running a dropshipping business in lieu of a more conventional, inventory-driven ecommerce store.

The main benefits of dropshipping are that it’s cost-effective, allows retailers to take risks with less costly repercussions, and makes the storage and infrastructure of inventory unnecessary.

Startup Cost is Lower

The traditional model for ecommerce often requires you to start your business with some initial capital. This capital is then used for obvious necessities like establishing your inventory and investing in storage space and infrastructure for that inventory.

You’ll also use the money for creating your brand identity, building a website, and developing your systems for day-to-day operations.

With a dropshipping business, you can eliminate some of those upfront startup costs. In turn, you can spend more time and capital on things like branding and website design.

Eliminates the Expense of Inventory

When you employ the dropshipping model of ecommerce, you can save yourself many of the expenses related to inventory.

Maintaining your own inventory requires an upfront investment to get your inventory established. You need a way to store and organize that inventory, too. This requires additional expenses, as will replenishing your inventory as you sell products.

Dropshipping offers a rather appealing solution. You can unload the burden of inventory by deferring all those responsibilities to your suppliers and distributors. In other words, you’ve basically got the inventories of several businesses at your disposal, but none of them are your responsibility to maintain.

Minimizes the Expense of Fulfillment

Fulfillment isn’t free.

Picking and packing — which is the process of compiling products for an order and getting them ready for shipment — takes time. Resources like boxes and packaging materials cost money. Shipping products can be expensive, too, especially when the products you’re selling are large or heavy.

As with the cost of inventory in general, dropshipping means that your suppliers and distributors do all the fulfilling of your orders, which means you’re not burdened by the process (and costs) of fulfillment.

You Can Take More Risks

Though taking calculated risks sometimes pays off, it’s harder to be a risk-taker when you’re maintaining your own inventory. If you decide to branch out by offering products in new product categories, what happens if your customers aren’t interested? You could take a huge loss on the amount invested in those products and any of the costs associated with adding them to your inventory.

If you’re not burdened with the expense of inventory, you’ll find that taking risks won’t necessarily have such a devastating effect on your revenue. If you’re dropshipping, your suppliers and distributors are the ones who are heavily investing in the products you’re selling.

You can experiment with adding new types of products to your online store without needing to put substantial financial backing behind those products.”

If you add a new product category and your customers aren’t interested, you’re not at risk for losing a bunch of money. It’s as simple as taking those products off your store.

No harm, no foul.

The Cons of Dropshipping

It may sound appealing, but dropshipping may not be the best option for every ecommerce business and online storefront. In fact, there are even certain drawbacks to dropshipping that you should consider before starting a dropshipping business.

Margins Are Lower

Not having to invest upfront in inventory and continue paying for storage and replenishment is a huge plus, but the trade-off is that your margins are much lower. The potential to profit from customer purchases is much more limited.

When you maintain your own inventory, you’re often buying your products wholesale, meaning you’re getting a discounted rate in exchange for buying in larger quantities. Since this makes your cost per item less, the margin on the item ends up being higher, which leads to more profit.

However, when yours is a dropshipping business, you’re deferring your orders to a supplier or distributor for fulfillment, and it’s that supplier or distributor who sees the impressive margins.

Your own margins will be negotiated with your suppliers and distributors, and it’s usually just a small percentage of what your customers pay for the product.

Dropshipping is Highly Competitive

The need for very little capital to start a dropshipping business makes it very appealing to a lot of entrepreneurs. For this reason, you’re likely to encounter much more competition in this space than with a more conventional, inventory-dependent ecommerce model.

You’re Dependent on Other Companies

When yours is a dropshipping business, you’re relying on other businesses and companies to essentially facilitate your business. Though many of the suppliers and distributors you’d be working with will have established credibility through years of reliable service, you’re still putting the future of your business into others’ hands.

And when you’re dependent on dropshipping to fulfill orders, you have a limited ability to provide customer service for the products you’re selling. For some issues, you may have to refer customers to your supplier or distributor for support.

This roundabout way of getting the service they need can be frustrating and discourage future purchases.

Brand Loyalty is Hard to Build

Outsourcing fulfillment by using suppliers and distributors to pick and pack your orders is convenient, but it offers very limited opportunities to establish a brand for your business.

Your suppliers and distributors could get the credit for all the products and services your customers buy.

If a customer falls in love with one of the products you’re selling, for instance, that customer is more likely to focus on whatever company actually manufactured and produced the product than the dropshipping business that served mostly as a liaison between the buyer and manufacturer.

Additionally, dropshipping provides fewer branding opportunities. Customers who receive orders placed through your dropshipping business may see another company’s logo on the box and the receipt inside. For traditional retailers, shipment is an opportunity to reinforce a brand, but since a dropshipper doesn’t actually fulfill orders, you’re not able to seize these kinds of branding opportunities.

The lack of branding opportunities is arguably one of the biggest drawbacks to dropshipping.

After all, customers find their favorite stores, and then continue buying from them. If your store is little more than a cash register, there’s very little incentive to continue buying from you versus finding the product from a more conventional retailer.

Is Dropshipping Right for You?

Ultimately, a dropshipping business is an effective business model for those who want to start ecommerce stores while investing as little as possible in the business upfront. On the other hand, those who put more value in branding opportunities or would like more control over margins would probably find the traditional model of ecommerce better meets their needs.

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Online shops face a unique challenge in that they need to convince customers to make a purchase without the opportunity to try before they buy.

Brick and mortar stores attract shoppers with decorative storefronts and displays. Seasonal decor and interesting store layouts create an experience for customers as they shop.

But online shops have to wow customers using a different method — one that sparks that same instant jolt of curiosity that comes with walking through a physical store.

Visuals are everything when it comes to online shopping. Just as a customer would walk into a store to look at the items in the window display, having supreme product photos instantly grabs a customer’s attention and encourages them to shop your store.

The reality: images can make or break a purchase. According to Forbes, the average customer forms a first impression within seven seconds. Some psychological research indicates this happens in even less time — a mere tenth of a second.

Stellar product photography does more than draw attention to your product. It also helps provide visual context for your customers as they shop and makes your website seem more legitimate. In an era of cheaply produced knock-offs and spammy products, high-quality original photos add ethos to your site and help show visitors you’re the real deal.

So what do you need to know about studio lighting for product photography? This guide will walk you through the steps to create eye-catching product photos in studio light. Let’s dive in.

What Is Product Photography?

First things first: what is product photography?

Product photography uses several techniques to highlight a product in a way that draws in customers and encourages purchases.

Essentially, product photography lets the customer get as close as they can to seeing the product in real life. Instead of using filters, unique angles, or distracting backgrounds, product photography captures the product as it is.

Lighting: The Difference Between Good and Bad Product Photography

Before you start snapping pictures of your product, understanding the ins and outs of what makes a quality product photo can help you produce your desired shot.

These product photos of a pair of Kodiak women’s boots from REI are an excellent example of proper product photography.

In addition to the multiple-image views, the images adhere to good lighting principles by incorporating key lights, fill lights, and backlights while photographing.

• Key lights are the main source of light pointed directly at the product.
• Fill lights are low-intensity lights placed on the opposite side of the camera from the key light.
• Backlights are lights placed behind and above the product to make the product stand out from the background.

Having these types of lights in place ensures the product is shown in sharp detail, and with minimal shadows, to create crisp, professional-looking images.

As a contrast, bad product photography would make it challenging for shoppers to see detail, understand dimensions, and get a full grasp of how the product really looks.

Now, let’s talk about studio lighting.

Understanding Studio Lighting

Studio lighting gives the photographer more control over — you guessed it — the light over an image. Natural light is trickier to photograph because it’s continually changing and requires quick camera setting adjustments to keep your photos consistent; it can be helpful to have a mix of both studio lighting and natural light photographs to really sell the product.

Studio light offers the same consistent lighting with any photo no matter the time of day and without having to modify your camera settings. This ability to control the lighting and create more consistency between your shots is one of the reasons why it’s optimal for product photography.

How to Create High-Quality Product Photos in a Studio Setting

With the right equipment, you can create stunning visuals for your online store that will seize the attention of your customers.

To get started shooting high-quality product photos in a studio setting, you’ll need:

• A camera
• A tripod
• A white or solid-colored backdrop (optional but recommended)
• A table or a flat surface (preferably one that’s movable)
• A reflector card
• A studio space or an area where light can be easily controlled
• Studio lights or a beginner lighting kit with basic lighting equipment

Next, it’s time to set up.

Step One: Set Up Your Area

Before you begin snapping away, take the time to set up your space so the photos are primed for the desired result. Move the table or flat surface to an area of the studio that gives you space to adjust the camera, fit the products, and fit the backdrop — like right against a wall.

Cut off any external light sources (like a window) before you start shooting to prevent any corruption. Otherwise, you might find yourself having to make constant adjustments depending on the outside light which defeats the purpose of having studio lighting.

Step Two: Set Up Your Background

Next, place your white backdrop behind and under the product. Make sure it sits from the front of the table closest to the camera, under the product, and up against the wall. This is known as the “sweep” in that your backdrop sweeps down under and behind the image up against the wall.

If you’re photographing smaller items, consider purchasing a seamless backdrop from Amazon or a lighting box that creates a smaller-scale photography studio environment.

Place the product in the center of the backdrop and leave space for the reflector card to sit. The reflector card will work to fill in all the shadows the product may cast. Move the card around until you get your desired look.

Step Three: Set Up Your Camera

Put your camera on the tripod and move it to the desired length away from your table setup. Adjust your camera settings and make sure your product is in focus. Double-check to make sure there are no external light sources and that your camera settings are correct for the image you’d like to take. No one wants to photograph their products only to learn later that all of their shots are inconsistent.

Step Four: Test Your Setup

Finally, take a few test photos to gauge what adjustments you need to make. This is a great opportunity to play around with your camera settings and determine what makes your product look its best. To be safe, take a moment to test the lighting during this time as well.

If you’re new to photography, it may take a few tries to nail down the image you’re envisioning. Play around with different setups and see which configuration yields your perfect product photo.

Common Mistakes in Product Photography

As we mentioned above, there are a few key differentiators that separate good product photography from bad product photography. Avoid these common mistakes and you’ll be on your way to creating excellent product photos.

Product Isn’t in Focus

If the product isn’t in focus when you look at your shots, the F-stop on your camera is probably set too low. Switch to the automatic setting on your camera or increase your F-stop until you find the right setting for your light levels.

Images Are Washed Out

If your photos look too washed out, your camera is letting in too much light, and the aperture on your camera needs to be smaller. Again, if you’re not comfortable experimenting with different camera settings, try using the automatic or ‘program’ mode and take advantage of the camera’s automated settings.

Too Many Shadows

If you find that your products look too shadowy in the photos, you likely need to add more fill lights or backlighting. Rearrange or add more lights to cut down on shadows.

Your Images Matter

There’s no denying it — images are a fundamental component of the online shopping experience you create for your customers, but to see results in the form of conversions, brand loyalty, and referrals, your online store must be cohesive. What better way to do that than with product photography?

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Here’s a fun fact for you: customers trust images even more than product reviews when it comes to buying online.

That means that for an ecommerce company, great product photography is an excellent opportunity to increase customer confidence and drive sales.

However, truly effective product photography is more than just pointing and clicking a camera. The best images help you maintain a professional, seamless appearance across all pages of your website.

So how do you accomplish that?

One way to is to create a consistent look through your lighting choice.

There are two main types of product photography lighting you can choose from: traditional studio lighting and natural light.

Some products are better suited to the bold or creative effects achieved through studio lighting while others may benefit from a more natural “lifestyle” aesthetic.

In this post, we’ll cover both types of lighting and the pros and cons of each.

The Pros of Studio Lighting for Product Photography

Let’s kick off by looking at the pros of studio lighting for product photography.

You Don’t Have to Work Around the Weather

Studio lighting is fixed and reliable. Indoor studios eliminate the requirement of good weather which is critical if you live in an area where there’s frequent rain or snow. When you’re working with a professional lighting setup, you never have to worry about a passing cloud ruining a set of images.

You Can Photograph Any Time of Day

With studio lighting, you can do product photography at the time of day that works for your schedule — even if it’s late at night. If you’re busy running your ecommerce business during the day, studio lighting will likely provide the greatest flexibility for photoshoots.

You Add Credibility and Make Your Photos Look More High-End

Professional-looking photos shot in studio lighting help build ethos for your brand by making you appear more professional and polished. This also makes your products look more high-end, and helps you justify a higher price point.

You Can Control Exactly How Your Photos Look

Studio lighting offers total creative control. You get to decide how intense the light is, the direction it’s coming from, and the shape of the light. In addition, you can use light diffusers to alter the harshness or color of the light.

For example, you could use umbrella diffusers to soften the light (creating a warm or romantic aesthetic), or you could use colored diffusers for a more dramatic look. This creative flexibility can make it easier to get images that reflect your brand.

The Cons of Studio Lighting for Product Photography

Now let’s look at some of the cons that come with studio lighting.

Studio Lights Can Be Expensive

You’ll likely need to purchase more than one studio light, and you may need to invest in an entire studio lighting kit. While the investment pays off in the long run, the upfront cost can be hard to swallow if you’re cash-strapped. Studio lighting kits for beginners can cost up to $350, while more professional studio lighting kits can cost thousands.

You Need a Physical Studio Space

Whether it’s permanent or temporary, you’ll need a studio space in which to shoot your product photos with a studio lighting setup (which is another expense you’ll need to consider.) Even a short-term space rental could add up quickly, so unless you have a spot you can use for free (or close to it), you may need to consider another option.

You Need a Reliable Power Source

Studio lights require a power source. This may not be a problem if you plan to shoot all your images in a studio, but it does mean that you will be limited to spaces with plenty of outlets.

If you want to shoot outdoors or on location, you may have to buy a battery pack or a generator. Not only is this an additional cost, but it also adds more equipment to haul back and forth to the shoot location.

There’s a Learning Curve

You probably weren’t born with an innate sense of how to set up studio lights, so you’ll need to spend some time learning the basics of soft versus hard light, color saturation, and the positioning of your lights around your products. This may take even longer to learn if you want to become enough of an expert in lighting to develop a unique look for your brand.

The Pros of Natural Light for Product Photography

So, what about natural light photography? Let’s dive into the pros of this approach next.

It’s Cheaper

All you need to take photos of your products in natural light is your camera. Though you may have to invest in a quality camera if you don’t already own one, you won’t have to purchase additional equipment. That makes natural light the more cost-effective choice.

Your Photos Will Have a Bright and Airy Aesthetic

This sought-after look is difficult to achieve with studio lighting. Customers are most likely to purchase something when they can easily imagine using or wearing it. Laid-back, lifestyle type images taken in natural light can be an easy way to help customers envision your product in their lives, thus potentially boosting sales.

There’s No Learning Required

Even if you’re not trained as a photographer, you’re likely able to capture decent photos of your products in natural light. For the time-crunched ecommerce company, being able to immediately step into the role of the photographer is important.

You won’t have to spend hours researching how to use studio lighting effectively, and you don’t have anything to set up. Just grab your camera and your product and head outside.

The Cons of Natural Light for Product Photography

As with anything, there are cons for natural light photography as well.

You’re at the Mercy of the Weather

Rain and snow make photographing outdoors challenging. You’ll have to plan shoots with the weather in mind, which makes natural light the less flexible option.

Additionally, you have to pay close attention to the sun’s position when you want to photograph your products. The light will look much different depending on the time of day.

For example, during the middle of the day, the sun is directly overhead which means the light will be very bright and possibly too harsh. During mornings and evenings, the light is softer and more flattering but because the sun is at an angle, you’ll have to carefully position products to avoid unpleasant shadows.

More Expensive Lenses May Be Required

The variability of natural light and outdoor environments means that a standard lens on your camera may not be good enough for quality photos.

Ultimately, you may need to purchase a faster lens to avoid blurry photos when the natural light is too low. A faster lens also ensures that any objects moving in the background, like birds or falling leaves, don’t blur.

You Don’t Have As Much Creative Control

While the natural light aesthetic can be beautiful, it’s not exactly unique. You can photograph from different angles or even incorporate some creative staging, but you’ll never be able to produce the truly dramatic or imaginative looks possible with studio lighting.

Choosing the Right Lighting for Product Photography: Your Call

The best lighting for product photography depends on your brand, your budget, and your time constraints. Before you decide whether to use traditional studio lighting or natural light, it’s helpful to consider what’s most important for your ecommerce company.

Remember that your choice of lighting will impact how your products are perceived by your customers. Online stores don’t have the option for customers to touch, try on, or test out your products before they buy, so your product photography needs to showcase your products in their best light.

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The act of walking into a physical store, paying for an item, and leaving has been replaced by a meandering, unpredictable consumer journey. For example, an online customer today might start his or her journey by clicking on your banner ad, arriving at your site, but leave without buying anything. Within the span of a week, they might receive a retargeting ad, hear a TV spot, read an online review, and get a recommendation from a friend before finally coming back to your store to actually buy.

The chaotic nature of today’s purchase journey makes predicting and prompting customer actions more necessary than ever. To get visitors to convert to customers, you have to optimize your entire marketing strategy and ecommerce store design. That means: removing barriers to purchase, enticing specific actions, and creating a pleasing and safe experience for customers. Conversion rate optimization is the way to do all of this.

What Is CRO?

Conversion rate optimization or CRO is the practice of raising your conversion rate by compelling visitors to your site to take specific actions like buying a product, downloading a PDF, or subscribing to a newsletter.

Although CRO is often used to make small, incremental improvements, its broader purpose is to optimize your entire marketing process—to make everything work smoothly. And the more optimized your marketing, the higher your conversion rate.

CRO and SEO Aren’t the Same

CRO and SEO (search engine optimization) are slightly connected but essentially very different strategies. The distinction is that CRO is concerned with how humans experience your website, SEO is only concerned with how machines, algorithms, and Google bots interact with it.

CRO and SEO focus on different stages of your sales funnel. Optimization for search engines happens earlier in the funnel—getting visitors to click through to your store. CRO takes it from there—visitors are here, now let’s convert them to clickers, shoppers, scrollers, and subscribers.

CRO and SEO do interlap at times. For example, if you optimize your blog copy for specific keywords, you simultaneously improve its readability and clarity for human readers, too. Streamlining your website architecture is another example of CRO and SEO working together.

Find Your Conversion Rate

Calculating your current conversion rate is pretty easy if you have the data available. Use this formula:

CR = Total number of conversions ÷ total number of visitors

Example: You sell a downloadable e-book to 100 people. Divide the total buyers by the number of visitors to your site. If 100 people bought the e-book and 800 visited your site, your CR would be 12.5% (800 ÷ 100).

Why Bother With CRO?

CRO gives you better control over how your customers interact with your website and the paths they take toward conversion. But what are the actual benefits? Here are three:

CRO Gets You Higher Profits

If your conversion rate rises, that means more of your customers are making it to your product pages, opening your emails, and subscribing to your service. By making small marketing CRO tweaks, you pay the same amount to attract customers but raise the number of actual buyers.

CRO Increases Your Traffic

Higher conversion rates mean customers are finding it easy to navigate your site, locate the right products, and make a purchase. Higher converting visitors spend more time on your site, leave more positive reviews, and leave as satisfied customers. More importantly, these happy shoppers will convince their friends and family to visit your store. More traffic for you.

CRO Keeps You Focused on Customers

CRO always puts the customer front-of-mind. When you make a design change to your website, taking a CRO approach helps you look through the eyes of your customers, not the preferences of your web designer or your own proclivities. Customer-centric decisions about design, copy, or ad placement have a better chance of increasing your conversion rate.

The Four Principles of CRO

To achieve the best conversion rates, entrepreneurs and marketers stick to four basic CRO principles.

1. Have a Clear Value Proposition

Customers take the next step in your sales funnel when they understand what sets you apart from the competition. If your value prop is your price, increase the font size and bold that price tag. If it’s the quality of your service, devote an entire section of your homepage to laying out your case. Customers will compare you to other businesses, and they’ll convert more when they understand the advantages you bring.

2. Incentivize Your Customers to Act

Half-priced sales, 30-day trials, and free downloads increase conversions because they incentivize shoppers to act. But there’s way more to customer motivation than just giving away free stuff.

Money-back guarantees and social proof also move customers to convert. The quality of your “About Us” page and FAQ page can determine whether a visitor clicks through to your product pages or bounces. Well-composed product photos entice customers to buy. Even the quality and usability of your blog articles incentivize customers to share your content and return for more.

3. Lower Barriers to Conversion

Customers need incentives to act, but if there are obstacles in their way, all the giveaways in the world won’t make up for it. Remove anything that gets in the way of any conversion you’ve set up. Barriers can include things like:

• High prices
• Slow page-load times
• Forcing customers to register
• Hard-to-find “Buy Now” button
• Confusing product descriptions
• Having no product images
• Off-site checkout

These are just a few of the biggest barriers to online purchase. Remove them and your incentives will work more effectively.

4. Make the Customer Feel Safe

Like a deer in the headlights, customers who feel unsafe about your brand or your process are hesitant to act—no matter how big the incentive or low the barrier. Many things affect a customer’s comfort level, from your home page’s color design to the payment gateway you use.

Some marketing strategies come with a tinge of distrust already attached to them. For example, pop-up ads on your homepage are effective at getting people to convert to subscribers. But they also carry a stigma because they’re used by cyber thieves to steal information. Plus, they’re annoying.

Weigh the costs and benefits of every part of your marketing plan and never sacrifice customer trust for an easy conversion.

Steps in the CRO Process

Much like the scientific method, optimizing your conversion rate includes gathering data, running tests, and making conclusions. The insights you collect add to your overall understanding of your marketing plan and your customers. Here are the steps of the CRO process.

• Gather Data. Gather what customer and website data you have now. Identify what conversions you are trying to achieve. Establish a baseline for your future changes.
• Form Hypotheses. Using your data, make an educated guess about what you expect will happen. Identify the audience and metrics you need to measure (e.g., click-throughs, downloads).
• Run a Test. Prepare a test of your hypotheses and make your changes. Make sure you’re accurately tracking your conversion data.
• Analyze. Given the outcomes, can you say your hypothesis was correct? If not, what happened? Was your prediction flawed? Maybe something went wrong with the test.
• Repeat. Gather your new data and form a new hypothesis.

CRO is a process that’s self-correcting, transparent, and honest. It keeps you from injecting your own biased perspectives about what’s working and what isn’t.

How to Improve Your Conversion Rate Today

Here are some immediate steps you can take to start optimizing your conversion rate.

Make A/B Testing Your Friend

One of the easiest, most effective methods for doing CRO is A/B testing. The testing method works for anything you want to change. So, it doesn’t matter if it’s a website design overhaul or a slight adjustment to your product page copy.

A/B testing is multivariate testing, which means you set up variations (an A and B version) of something (e.g., landing page) and split your traffic going to them. Then you simply compare the conversion rates for both. When you analyze the data, you can use these A/B testing results to inform your next steps.

There are A/B testing plugins available for WooCommerce users as well as entire platforms devoted to A/B testing your website and marketing strategy.

Set Up Conversion Tracking

You need to setup conversion tracking to see if and how your customers are converting. The process is essentially tagging a specific group of customers to see how they got to your site and what they do once they arrive. It’s a powerful tool for CRO.

Setting up conversion tracking in Google Analytics is a quick way to get started gathering data about your customers’ behavior. A popular tracking method is to use conversion actions in Google Ads to determine the ROI for your ad spend. It’s easy to get Google Analytics connected to your WordPress site if you haven’t already.

With Google Ads conversion tracking, you can view the number of downloads and purchases within your app. Or track a customer’s journey that starts online (e.g., clicks an ad) but finishes offline (e.g., signs a written contract).

Keep Your Store Running Fast

Here’s an ecommerce stat you’ll want to remember: 57% of all online consumers will abandon a site after waiting 3 seconds, and 80% will never return. The speed of your website underpins every CRO action you take. Your customer experience may exceed the next 10 competitors, but if your product pages load slower, they’re going to beat you anyway. No one wants to pay for a $75 steak if it takes an hour to get to their table … and it’s cold when it arrives.

When you do a website audit, test your page load times to see if they’re up to spec. There are plenty of simple ways to improve your website speed. But start with your foundation—your web host. Not every web hosting service meets the needs of an ecommerce site. Find a web hosting plan designed for eCommerce and one that gives you the power of customization.

Many ecommerce platforms offer templated storefronts that are difficult to customize. That certainly plays against any CRO strategy. You can’t optimize without changing things, and you can’t change things if your web host doesn’t let you.

Visit Your Own Website

Good CRO is about making changes that are informed with reliable and relevant data. But never forget the subjective component—your customers. Data analysis and conversion tracking alone don’t tell the whole story of your customers’ journey. CRO also requires you consider the subjective—how your customers feel when they visit your site. To run CRO like a pro, you’ve got to empathize with your customers, look through their eyes—surf a mile in their browsers.

With that in mind, re-read your persona descriptions, clear your browser cookies, and peruse your own website like a new visitor. Sign up for your own newsletter. Talk to your customer support. Search for products and go through the checkout process. Note any barriers to your navigation. Go with your first instincts. What felt even a little awkward? What felt right?

After doing a customer-centric site analysis that looks at these enticements and barriers, you’ll have a better appreciation for what your customers are seeing. Take those insights into your next CRO strategy meeting.

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As an ecommerce business owner, it doesn’t take huge amounts of money or massive acts of grandeur (we’re looking at you, Taco Bell!) to surprise and delight your audience, a technique that’s been shown to be an incredibly powerful tool for building customer loyalty.

According to Harvard Business Review, surprise not only changes behavior — it turbocharges emotions and fuels passionate relationships between customers and brands. Loyal customers are 5x as likely to repurchase, 4x as likely to refer, and 7x as likely to try a new offering.

Whether you are a rapidly growing ecommerce start-up with hundreds of thousands of dollars in sales or just sold your first product on Etsy last week, try incorporating the following tips into your daily business routine.

You’ll deliver a surprise and delight experience that will keep your customers coming back for more.

Take it Offline

Nothing kills authenticity faster than receiving an email addressed to Hey there! or Dear Sir/Madam. When it comes to creating a successful surprise and delight experience for the customer, the first step is to make it personal (we don’t know who “sir” and “madam” are but we like to think they would agree).

Taking the time to learn about who your customer is and reaching out to them in an unexpected way can be the first step in forming a loyal brand relationship, particularly in a world where people are constantly flooded with digital communication.

Almost every company will automatically send a generic thank you for your order! email after a transaction is complete, but online pet retailer Chewy.com takes customer appreciation to an entirely new level. They send out handwritten notes of appreciation to first-time customers.

It’s a simple gesture, but one that packs an incredibly thoughtful punch. If you are an ecommerce store that has had a single transaction, then you already have everything you need to start implementing this surprise and delight example for your own business. Buy a roll of stamps, start practicing your cursive handwriting, and put your customer data to good use! There are plenty of ways to say thank you via a handwritten note or by email.

Make it Personal

If you’ve ever been a regular at a coffee shop or restaurant, then you know the delight that can come from walking up to a counter and having the staff member say Good morning! Will you be having your usual today? There is comfort in knowing that someone has taken the time to get to remember our preferences. This idea applies to ecommerce businesses as well.

For example, consider the beauty brand Birchbox. Every month, their customers get a box of sample-size beauty products to test and try with the option to go online and purchase the full-size version if it’s something they truly can’t live without.

It’s a concept that Birchbox has turned into a subscription box empire. They drive customer loyalty with personalized discounts on brands and products a customer has loved and purchased repeatedly.

This technique not only shows customers you are paying attention, but also that you are taking the time to understand their likes, preferences, and ultimately anticipate their wants and needs. Surprising, and delightful.

Timing = Opportunity

Birthdays, anniversaries, and holidays are opportunities to surprise and delight your customers with extra rewards and perks. Do you have a customer who has purchased the same item multiple times? Or perhaps a customer who has commented on a social channel expressing interest in a new product offering? Sending a free product to a repeat customer, or wrapping up that T-shirt a customer commented on is a fantastic way to create surprise and delight throughout the year.

In 2014, Lord & Taylor took this advice to heart by posting the #OBSESSED hashtag promotion to their (at the time) 65,000 Twitter followers. Customers were instructed to post an item carried at the store using hashtag #OBSESSED as shown.

As the weeks started to pass and the holidays drew closer, customers were delighted when they started to receive free of charge, the very items they had admired online. Create a similar surprise and delight experience for your own customers by offering a personalized birthday or holiday gift as a way of saying We appreciate everything you have done for US, now here is something special just for YOU!

Don’t Attach Strings

It’s the same as giving a present to a friend or family member. Gifting is about how you want that person to feel, and not about what you expect to get in return.

Social shares, hashtags, and user-generated content can be a fantastic benefit of surprise and delight, but should never be the foundation on which the experience is built. The best surprise and delight examples are always going to be the ones that feel authentic, and the customer isn’t left with a sense of expectation or feel that there are strings attached to the generosity.

Make it easy for customers to enjoy the kind gesture and remove any potential roadblocks, such as expiration dates on birthday coupons or free shipping codes that only work at a certain price threshold.

Be Human

The world of ecommerce can feel like you are constantly interacting with a team of highly trained robots, particularly when it comes to customer service. As a business owner, taking the time to actually engage and speak with your customers one-on-one is a simple yet impactful opportunity to make a customer (or a potential customer!) feel like their voice matters.

For Karissa Bodnar, the CEO and founder of cosmetics start-up Thrive Causemetics, daily interaction with customers has become a personal mission. In addition to a fully-staffed customer service team, you can find Bodnar online and interact daily with the brand’s more than 440,000 Facebook followers, and via her own personal Facebook account.

Surprise and delight the people who are taking the time out of their day to interact with your brand and business by showing them the same amount of respect. That means — reach out promptly, engage in a dialogue, and always provide solutions to questions or concerns in actual human (not robot!) language.

Surprise and Delight is for Businesses of All Sizes

A one-of-a-kind customer experience can benefit your business in a variety of different ways, and the effort it takes is well worth the reward. Keep in mind, you don’t have to be a huge company with a million dollars in sales to benefit from incorporating a surprise and delight strategy into your business methodology.

Surprise and delight isn’t about sending the biggest gifts or getting the most media coverage — it’s about creating special and unexpected moments with customers. That’s how you build brand love and brand loyalty — and brand retention — for years to come.

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Did you know that engaged customers represent a 23% share of profitability and relationship growth vs. the average customer?

What does that mean? It means that engaged customers go straight to the bottom line.

So how do you increase customer engagement and drive sales? One word: personalization.

In this article, you’ll learn how to take customer data and turn their online shopping into a personalized experience that increases customer engagement and drives sales.

Sound good? Before we get started let’s consider some questions.

What is Customer Data? And Why Should You Care?

Customer data is any information about your customers that highlights how they are using your product or service, as well as how they are (or aren’t) interacting with your brand.

Customer data goes by a few names, including:

• customer lifecycle data
• analytics data
• behavioral data
• digital marketing data
• event data

Whatever you call them, these insights are critical (and so is keeping customer data safe).

Knowing what products a customer viewed on your ecommerce store, what landing pages they hit, any sales calls they had or any other interactions with your site are key to understanding your market.

What Kind Of Data Can I Collect?

You can collect all sorts of user data from your WooCommerce store, including:

• number of orders made
• first & last order date
• lifetime customer value
• billing country, state, and city
• product reviews submitted

How to Collect Customer Data

There are three distinct ways you can go about collecting this information:

• directly asking customers
• indirectly tracking customers
• using other sources of customer data to your own

Ideally, use a mixture of all three.

So you’ve got all this data. Now what? It’s time to understand customer engagement.

Customer Engagement 101

Customer engagement is the connection between consumers and your company or brand through your channels. It can come in the form of reactions, interactions, or overall customer experience. Customer engagement is all about compelling your customers to interact with your brand.

Done well, it is a strong and stable growth strategy. A solid customer engagement strategy not only encourages growth, but it also boosts brand loyalty.

There are different types of engagement including contextual, convenience, emotional, social, and post-purchase engagement.

Focusing on customer engagement flips around the buyer-seller business model. You as a company are no longer looking to extract revenue from your customers but instead, create value for them.

Customer engagement done correctly leads to stellar customer experiences, helps ease customer support, and can even lead to compelling original content.

Want to build a loyal customer following? Check out these customer engagement strategies:

• prioritize customer experience
• have a brand voice familiar to your audience
• engage on social media
• create useful content people want to read
• listen and respond to feedback

But what if you want to engage by speaking more directly to a customer’s individual needs?

Enter Email Personalization

Email personalization is when you use subscriber data to tailor email communication to them and send subscribers only relevant content. This makes them feel like you are talking directly to them, like a trusted friend.

Personalizing your messaging for customers can help move the needle. In fact, it’s proven to increase open rates by as much as 50%.

Gathering subscriber data and segmenting subscribers into more detailed lists is key. No one wants to be a target for mass marketing.

5 Ways to Personalize Your Emails and Drive Sales

Remember all that user data you collected? Your customers’ names, the offers they like, and what they’ve ordered from you in the past? Well, now it’s time to put that data to use and personalize your email campaigns.

1. Your Copy

Use a personalized email subject line and email copy.

Talk to your customers like you are talking to a friend. You’ll get a better response and form a better relationship.

For example, this email from a B2B data provider could be to anyone:

It’s pretty generic and doesn’t really speak to the recipient. This email from Zapier however, directly addresses the customer.

Use of a name — a first name in this case — delivers a friendly tone along with helpful information.

2. Your Imagery

Personalizing the images you show to customers is a great way to increase engagement.

Change the images based on the available data you have. For example, change imagery to reflect locations for customers in different parts of the world.

Or like Booking.com, you can change images based on recent search activity.

3. Your Offers

Once you have enough data, you can create customer profiles — then show customers offers that are more likely to ensure engagement.

If you run a clothing store, it wouldn’t make sense to promote offers on women’s belts to customers who have only ever bought men’s slacks. Or, if you’re a travel site, promote family vacation packages to customers who only buy single tickets. It doesn’t have to be as clear cut as these examples. Prioritize the most relevant promotions.

The education company General Assembly provides classes on design, product management, and marketing. They highlight specific topics when promoting their free resources.

Your offer is only as good as the people you are showing it to.

4. Your Product Recommendations

Product recommendations offer a great opportunity to get customers to make additional purchases. You might as well increase the odds by using customer data to recommend products they’ll actually want.

You can get this information from past purchases, personal preferences, or if you have a wish lists feature.

Amazon injects items from customer wish lists into emails.

With the help of an email marketing provider like Mailchimp or Campaign Monitor, you can integrate customer data into your campaigns.

Using this data creates more relevant and therefore, higher-converting email campaigns. Plus, it builds up the trust necessary for a long-term relationship that increases a customer’s lifetime value.

5. Cart Abandonment Emails

Did you know that abandoned carts account for a massive $4 trillion of lost revenue each year?

You (and your website) have already done the hard work. You brought a customer to your site, directed them to a product, they’ve made a selection, and added it to the cart. Then for whatever reason, they’ve decided not to complete their order.

You don’t want to be leaving revenue like that on the table, so give them a nudge with a cart abandonment email to recapture their purchase.

It doesn’t have to be complex. Just send a gentle reminder.

You increase the likelihood of cart abandonment emails when you personalize these reminders based on customer data. Using their name is a good place to start. You could also offer a discount or related products to further entice them.

Making Your Data Go Further

So you’ve collected all this customer data, analyzed it, and personalized your email campaigns. Now what?

Pick some ecommerce metrics to work toward. You’ll want to track and measure your progress so you can improve.

Don’t track too many goals. Too much tracking can lead to analysis paralysis — you spend too much time looking at numbers and not enough time implementing. It’s a balancing act.

Think of the questions you want to answer, and then work backward.

Figuring out answers to these questions will help your business grow and help boost your customer engagement.

How Collecting Customer Data Adds Up to Success

Gathering customer data is a never-ending task, but collecting it, storing it, and analyzing it can be the key to turning your business into a long term and profitable business.

It’s a simple equation:

Customer Data + Customer Engagement = Sales

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