What is a customer engagement score?

A customer engagement score is a metric that quantifies how actively a customer interacts with a company’s products, services, or communications. This score can be based on factors like frequency of purchases, email open rates, time spent on a website, or social media interactions. The higher the score, the more engaged the customer is with the brand.

Why is customer engagement score important?

For ecommerce businesses, a customer engagement score helps identify highly engaged customers who are more likely to make repeat purchases or renew subscriptions. It also helps companies detect disengaged customers at risk of churning, allowing them to implement targeted retention strategies. For customers, engagement often correlates with satisfaction, so measuring and responding to engagement scores can lead to improved user experiences and product offerings.

What is an onboarding flow?

An onboarding flow refers to the series of steps or actions a new customer takes after signing up for a service or subscription. It typically includes account setup, tutorials, and product tours designed to familiarize the customer with key features and encourage early engagement. A well-structured onboarding flow ensures that customers can easily get started and understand the value of the product.

Why is the onboarding flow important?

A smooth onboarding flow is crucial for reducing churn, particularly for subscription services. When customers understand how to use a service and see its benefits early on, they are more likely to continue using it and eventually become loyal subscribers. For ecommerce businesses, improving the onboarding process can directly lead to higher conversion rates, better customer satisfaction, and increased long-term retention.

What is surprise and delight?

Surprise and delight is a customer-centric strategy aimed at exceeding expectations by delivering unexpected, positive experiences to consumers. It involves going beyond standard service norms to create memorable moments that leave customers pleasantly surprised. 

Surprise and delight can be a powerful differentiator, fostering stronger emotional connections with customers and increasing brand loyalty. By adding unexpected touches to the shopping experience, ecommerce businesses can create moments that resonate with customers long after the transaction is complete.

How can surprise and delight drive action?

Implementing surprise and delight initiatives can lead to several tangible benefits for ecommerce businesses. Firstly, it can boost customer retention as delighted customers are more likely to return and make repeat purchases. Additionally, positive experiences are often shared with others, leading to word-of-mouth referrals and organic growth. Moreover, surprise and delight can help increase customer lifetime value by fostering deeper relationships and encouraging customers to become brand advocates.

How to incorporate surprise and delight into your ecommerce strategy?

To effectively integrate surprise and delight into your ecommerce strategy, start by understanding your target audience and their preferences. 

1. Personalization is key—tailor surprises to individual customers based on their purchase history, behavior, and preferences. 
2. Utilize data analytics and customer feedback to identify opportunities for delight, whether it’s through special promotions, personalized recommendations, or unexpected gifts. 
3. Finally, ensure that surprise and delight initiatives are genuine and authentic, reflecting your brand values and fostering genuine connections with your customers. 

By consistently delivering delightful experiences, you can turn ordinary transactions into memorable moments that drive customer loyalty and business growth.

What is a loyalty program?

In ecommerce, a loyalty program is designed to offer exclusive benefits that reward customers for key actions, such as making repeat purchases or signing up for a subscription. Loyalty programs can take many different forms depending on their pricing structure and benefits to the customer. 

As these programs are designed to reward customer loyalty, they can be a powerful strategy for attracting new customers, retaining existing customers, and increasing customer lifetime value (LTV). After all, research shows that loyal customers are more likely to make additional purchases with a company, provide positive reviews, and act as brand advocates.

What are the benefits of customer loyalty programs?

These programs aren’t just created to build customer loyalty. For businesses, these programs can lead to more valuable customers overall, as they are designed to motivate customers to take specific actions with a store, like spending a certain amount or making a certain number of purchases. This can allow businesses to more effectively retain customers and acquire new shoppers. It can also lead to increased customer engagement and brand awareness.

Rewards customers can receive within these programs can vary greatly. They may include exceptional customer service, discounts, free gifts, store credit, exclusive access to content or products, an improved customer experience, and more. 

What’s the difference between a free customer loyalty program and a paid membership program?

Often, loyalty programs fall into two main categories: free loyalty points programs (also referred to as rewards programs) and paid membership programs. While these programs have some level of overlap, they also differ in the benefits they offer customers and businesses, as well as their pricing. 

For example, in a rewards program, customers earn points in exchange for their purchases, and these reward points can then be redeemed toward future purchases. In a paid membership program, however, customers must pay a fee in order to gain access to deeper benefits, such as recurring discounts, exclusive content, special events, and more. Knowing these differences can help you determine the best strategy for your own loyalty program.

What is net promoter score?

Net promoter score (NPS) is a customer experience metric for gauging customer loyalty and customer satisfaction. NPS is tracked by a variety of business types, from internet service providers to financial services, and can even be used to assess the satisfaction of employees at a company. Typically, net promoter scores are determined through single-question customer feedback surveys that ask how likely an individual would be (on a scale of 1–10) to recommend a business’s products or services to a colleague or friend. 

NPS categories

Customers who respond with an NPS score of 0–6 are referred to as “detractors”—unhappy customers who may pose a risk to the business through negative word of mouth. Customers who respond with a score of 7–8 are known as “passives,” indicating that they may be at higher risk of leaving the business for competitive offerings. Customers who respond with a score of 9 or 10 are known as “promoters”—a business’s most satisfied, enthusiastic, and loyal customers who may be more likely than others to refer new customers.

To calculate net promoter score, a business should subtract their percentage of detractors from the percentage of promoters.

Monitoring net promoter score

The net promoter score system is a valuable tool for measuring customer loyalty, which can ultimately be used to help predict business growth and improve customer retention rates. NPS surveys can be used at a variety of different stages of the customer journey, depending on a business’s unique goals. By using segmentation to separate the most enthusiastic customers from the least enthusiastic ones, businesses can gain a deeper understanding of the way that they are perceived by various groups within their target audience, then pivot their strategies more effectively.

What is a repeat customer?

A repeat customer, or repeat buyer, is a customer who makes at least two purchases with the same company. Over time, as they continue to repeat business with you, these individuals can become your most loyal customers, with higher customer lifetime value and levels of customer satisfaction. As the cost of acquiring new customers can be five to ten times greater than that of retaining existing customers, identifying repeat customers and understanding their needs and preferences is a powerful strategy for any ecommerce business. 

Subscribers are a particularly valuable type of returning customer, as their purchases recur on a set cadence. However, subscribers and repeat customers are not synonymous, as a repeat customer does not always sign up for a subscription to continue their purchasing behavior.

Strategies for increasing repeat customer rate

There are many strategies businesses can use to encourage customers to make repeat purchases. Paying attention to customer feedback is a crucial one, as is monitoring trends in customer shopping behavior. By identifying patterns in customer data, behavior, and feedback, businesses can identify areas for improvement in the customer experience—not only helping increase customer retention rate, but also aiding in new customer acquisition. Customer loyalty programs can be another effective way to encourage repeat customers to continue to purchase. Perks like free shipping, discounts, or exclusive access to products and early releases can all be incorporated into a loyalty program to incentivize a repeat purchase.

What is a customer winback?

A customer winback, or win-back, is when a business regains its inactive customers or former customers. This is often achieved via a win-back campaign, or a calculated marketing plan aimed at recapturing lost customers. The goals of a customer win-back strategy are primarily to increase customer retention, reduce customer churn rate, and increase customer lifetime value (LTV). These efforts can also have the potential to increase customer satisfaction.

Customer win-back strategies

In order to recapture lost customers, a business must first determine why customers have stopped using their products or services, which can be done through studying trends in customer feedback and purchase history. This can identify potential pain points to improve in the buying process, identify high-value customers, and pinpoint existing customers to target with winback strategies. 

It can also be helpful for businesses to segment their customer base so they aren’t applying the same win-back strategies to every existing customer. By making sure that win-back strategies are tailored toward a particular segment, brands can reach the right customer with the most compelling effort for their unique preferences and needs, be it win-back emails or a special discount on certain products. After all, there is no one “right” win-back strategy—it all depends on the needs and preferences of a business’s unique customer base.

What is customer retention?

Customer retention refers to the ability of a company to keep current customers with their business. For subscription brands, having an effective customer retention strategy is particularly important, as the subscription business model depends on recurring revenue. Having a high customer retention rate increases customer lifetime value for your business, improving customer loyalty and customer satisfaction. Retaining your most loyal customers can also help improve average order value (AOV) for your online business.

Customer retention strategies 

There are a number of strategies your brand can use to improve customer retention. Investing in analytics and collecting customer feedback in your customer retention program are both valuable tools for establishing a baseline for your business. Make sure you effectively set customer expectations for your products and services through your messaging and imagery. 

Tracking key metrics over time—such as customer lifetime value, customer churn, customer acquisition costs, etc.—can help you identify trends in customer behavior and business performance and assess the effectiveness of your retention strategies. Another business strategy for retaining existing customers is to offer a customer loyalty program. 

Retain customers with the right strategies

Subscription businesses can increase customer retention when they empower customers to manage their own subscriptions. For example, make it easy for an existing customer to skip or reschedule a delivery, or swap or add on a new product or service to an order, without having to engage your customer support team. This creates a more seamless experience for the subscriber and lessens the chance that they will churn out of your business. 

With the right loyalty-focused strategies, your brand can improve upon retaining customers and strengthening customer relationships, even as the number of customers you serve increases. Continually tracking customer retention metrics will also ensure your brand is headed in the right direction. 

What are customer portals?

A customer portal is a secure hub on your ecommerce website that gives your customers easy access to all relevant information about their business with you. Customer portals can contain a variety of different features depending on your business, including invoices, account and billing information, access to support features or a knowledge base, options to swap products, and more. For subscription services, who interact with their customers on a recurring basis, customer portals are especially important. When built effectively, these tools have the ability to facilitate stronger merchant and customer relationships, increasing customer satisfaction and brand loyalty.

Strategies for optimizing your customer portal

To optimize your customer portal for your subscription business, it’s important to think about customer flexibility. Empowering your subscribers to manage their own subscriptions increases flexibility and improves the customer experience, as they can update their active subscriptions on their own timeline in a few clicks, all without having to engage your customer support team. Making sure your customer portal is accessible via a mobile device is another important way to optimize your omnichannel strategy and ensure your customers can control their orders via the portal whether they’re at home or on the go.

What is customer churn rate?

Customer churn (also referred to as customer attrition) is when customers stop using a business’s products or services over a certain period of time. Reducing churn and improving customer retention rates increases revenue and customer lifetime value for merchants. Conducting churn analysis is crucial for understanding the causes of customer churn, identifying where in the customer journey the churn occurs, and generating solutions to improve customer retention. 

Churn rate is one of the most important measurements for subscription companies to track. If the number of new customers joining your subscription program is less than the total number of customers lost from your brand, your business is losing its lifeblood. The “leaky bucket” is an analogy that is often used to envision customer attrition. Methods for reducing customer churn are known as retention strategies. 

Strategies for reducing churn in subscription businesses

Offering skips and swaps are two best practices to reduce customer churn, keep existing customers engaged, and boost brand loyalty. Allowing customers to skip or delay their deliveries retains them as active subscribers for a longer period of time, boosting lifetime value and increasing customer satisfaction. Swaps are another proven retention strategy for subscription model businesses, creating a more personalized user experience. Finally, conducting customer churn analysis is an important last step for understanding negative churn and optimizing any frustrating aspects of the service.