If you’re planning to set up an online store, you have a lot to consider. Amongst other things, your checklist will include applying for a business license, developing a concept, and calculating your finances. But don’t despair! A host of webstore programs and optimization functions are on hand to help you succeed.
Good customer service ensures long term success
Customer retention is one of the most important marketing instruments in online business, because your competition is only a few clicks away. The customer lifecycle on the internet is a lot faster than traditional sales, which can be quite frustrating for store owners at first. With good customer relationship management (CRM) you can convert casual customers into regulars who will remain loyal in the long term. This means you’ll benefit from a more stable income and can plan your business processes better.
The customer lifecycle is not eternal
The term ‘customer lifecycle’ refers to how the business relationship develops between you and the consumer – from the first until the final contact. It is quite unrealistic that a consumer will visit your store again by chance, though it is possible. The customer lifecycle can be divided into different phases; each having a variety of measures to increase customer loyalty. Below we show you both the individual stages as well as the appropriate CRM measures in chronological order.
1) Acquisition phase
During the initial phase, you’re dealing with potential customers. They’re researching certain products, comparing providers, offers, or models, and could also delay their purchase if they’re having doubts. At this stage it’s important to make your store stand out and catch the customer’s attention by employing classic marketing measures, for example:
- Search engine optimization
- Affiliate programs
With a stylish design, high quality product images and descriptions as well as providing reviews from customers or certificate authorities (CA), you will ultimately win the customer’s trust. Additional questions on topics such as data protection, ordering processes, delivery processes as well as the payment method should be provided to increase the chances of a purchase. You should regularly analyze the bounce rate and exactly when the customer leaves the site so that you can work out which areas need improvement.
2) New customers phase
After you’ve assured your newly-acquired customers that your online store is indeed trustworthy, you then have to justify this claim. This means that you have to fulfill all your promises regarding the status and delivery of the goods and mention any complications. Thank them for their loyalty and grant them space for feedback and complaints as well as making any necessary improvements. Inform your new customers on what you have to offer them on their recent purchase in the hopes that they will recommend your social media channels to others or pass on information from your newsletter.
3) Existing customers phase
While the previous measures are very typical and frequently used, now comes the main focus of customer relationship management. In the existing customers phase you can outdo your competition by being individual and creative in order to ensure a long-lasting customer lifecycle. While the whole goods ordering and delivering process should maintain a high level of quality, you can use different loyalty programs for an exciting new boost. Some ways in which you can show your appreciation are:
- Bonus systems / rewards
- Competitions / prize draws
- Coupons / presents
- Special offers / discount campaigns
- Special conditions (e.g. shorter delivery times)
On top of your normal customer dialog, make sure to check satisfaction regularly and make any necessary changes to your online business. Take note of comments left on social networks such as Facebook and Twitter. If you ignore your followers and simply use the platform for marketing purposes, your reputation will quickly be affected. Many companies are active on social media to make it easier for customers to reach them.
3) Separation phase
If a customer hasn’t bought anything from your store in a while, they are then known as a lost or former buyer. It’s obviously in your best interest to re-activate the user and the more effort you put into CRM, the more likely it is for you to achieve this. Don’t give up on your former customers without a fight: try to persuade them to come back by personally calling or e-mailing them. Tie this in with special conditions (where feasible) such as a long-term discount, free shipping, or reduced fees to give them an additional incentive.
CRM: an asset to your online business if used correctly
As your customer base continues to grow, it’s easy to lose sight of things and keeping customers loyal can prove difficult. Consider hiring a customer care specialist who can bring a different perspective to your service and deal with customers better. If you don’t want your customers being managed by a third party, you can make use of CRM products such as Sugar CRM or Salesforce.
Whichever type of customer relationship management you choose, you should definitely keep in mind how appropriate it is for your online store. Spending more money on maintaining your customer base than you receive in return is fine for a while, but isn’t ideal in the long term. Be aware of the balance between cost and benefit and you will reap the rewards of your good customer management sooner or later.