Competition in ecommerce is fiercer than ever. The cost of acquisition is continuing to rise, while customers’ discretionary spend is decreasing. Recent Shopify research shows 79 per cent of Australians are cutting down on spending to save money, and more than half of consumers are actively seeking the best value.
Online businesses wanting to sustain or grow their market share cannot afford to focus solely on finding and converting new customers. A more financially savvy approach would lead with focusing on the lifetime value of a customer, and applying lifecycle and retention marketing strategies that keep existing customers engaged, valued, and coming back for repeat purchases.
However, one of the biggest challenges that ecommerce businesses face when starting a retention marketing strategy from scratch, is determining the best timing to engage with their customer base. It is critical to ensure engagement workflows and actions are tailored around the unique customer journey of each individual customer, but overloading them with excess content or touchpoints could make them feel like the brand is taking a blanket approach to spamming their followers rather than trying to add genuine value.
The ideal timeframe for every brand will be different. For example, regardless of how engaging a brand’s SMS and email copy may be, consumers are unlikely to buy something like a bed mattress every month. Having said that, Chronos Agency conducted a cohort analysis across 30 ecommerce brands from January to December 2023, and found three key insights to help businesses get the timing right.
Take advantage of the first 30 days
Our research showed that consumers are most likely to repurchase within the first 30 days. This initial period after a purchase can be when many brands hesitate to engage, from fear of coming across as intrusive or overbearing. However, with an engagement strategy focused on adding value to the customer, brands can significantly boost their total revenue from each customer within a month of their latest sale.
Start with New Customer Nurture (NCN) flows that stay engaged with customers from the time of purchase, and include value-adding content such as social proof, reviews, guarantees, and upsells.
Target your biggest engagement drop-off
Do customers stop opening your emails after two weeks, two months, or two years? Are they more likely to click on an SMS link three months after a purchase, in comparison to four months? Looking at the engagement data over time will help uncover the biggest engagement ‘drop-off’ for a brand. According to our analysis, the biggest drop-off tends to happen around month four.
For win-back campaigns, this would be the best timing to start a win-back flow. This is likely to be a brand’s last chance to re-engage with a customer before their interest in the brand completely disintegrates. Offering something like a discount to ‘come back’ to the brand at this stage will likely be money well spent, in comparison to potentially offering the discount too early when the customer is still considering making a follow-up purchase.
Leverage data to identify months of outsized gains
Knowing which months are the highest performing will be critical to capitalising on periods when existing customers are engaged and interested in making a purchase. This will differ from brand to brand, though our analysis highlights that June, July, and September had the highest repeat purchase rates, indicating the most effective months to invest in marketing.
Using data to identify when these peaks in engagement and sales are likely to happen will enable brands to concentrate their resources to maximise profitability and lifetime customer value.
In today’s complex ecommerce landscape and with consumers battling an ongoing cost-of-living crisis, reaching customers at the right time and with genuine value is paramount to ecommerce success.
Recognise when and how customers want to hear from your brand and do not shy away from connecting with them via multiple channels or testing multiple messages to get to know them better. As long as value-adding is at the core of brands’ intentions, there will be a strong likelihood of retaining customer loyalty while generating repeat sales.
Nina Jung is chief revenue officer at Chronos Agency.