Tips on How to Maximize Customer Retention
Imagine after all of the effort and marketing dollars you've invested in acquiring new customers, that you slowly start losing them over time, seeing them unsubscribe from your email list one by one. That's a reality for some marketers, and an inevitable nightmare if they fail to execute on an effective retention strategy.
Customers are unique. To retain them, you must treat them differently, learn about their preferences and give them what they deserve.
At Retention Science, our goal is to help our clients engage their customers with more timely and relevant information. The end goal is always to maximize customer retention.
Our studies have uncovered revealing insights that marketers can leverage to avoid playing the guessing game when it comes to their customer retention campaigns. Retention Science recently conducted industry research to determine the days and times that result in the highest email campaign conversion rates, as well as the types of offers that perform best. Our analysis involved more than 100 million online user actions.
One of the most informative findings is that offers sent later in the day generated the highest online conversions. Afternoons between noon and 6 p.m. were the most effective, yielding a 38 percent conversion rate. Evenings between 6 p.m. and midnight ranked second (28.5 percent), mornings between 6 a.m. and noon were a close third (27 percent), and late night trailed significantly (6.5 percent).
Our research debunks the theory held by many marketers that all emails should go out first thing in the morning. Generally speaking, most of their target customers are digging out of their inboxes at work in the morning and more likely to think through a purchasing decision in the afternoon or evening.
Customers are Most Active During the Week
We also compiled results from campaigns sent on different days of the week to see how that impacts engagement in terms of open and clickthrough rates (which ultimately lead to conversion). Tuesdays and Fridays were by far the best days. Twenty-eight percent of emails sent on Tuesdays converted, and 26 percent sent on Fridays converted.
I suspect that perhaps most online shoppers are out and about on weekends, which resulted in lower engagement and conversion rates. This is consistent with general internet activity stats that show a dip in nonmobile internet use on the weekends. Saturdays had the lowest conversion rate (3 percent), with Sunday slightly better (6 percent). Mondays were the worst weekday with an 8 percent conversion rate, trailing Wednesdays (12 percent) and Thursdays (17 percent).
A good case in point for timing optimization is found with SwayChic, a women's fashion retailer with six physical stores located on the West Coast and a robust online presence. SwayChic switched to Tuesday evening promotional emails three months ago, and has seen revenues increase by a remarkable 300 percent.
Increase Conversions With Free Shipping
It's a given that the type of promotion that's offered can influence conversions and directly feed into customer engagement. Remember, not all industries are the same, so you may find differing results in your particular industry. Our data showed that free shipping offers outperform percentage-off offers in terms of conversion. Free shipping offers convert at rates between 0.22 percent and 1.9 percent, making them twice as effective as price-reduction offers, which convert at rates between 0.1 percent and 0.8 percent.
The key takeaway here is that in order to maximize customer retention, you must treat customers based on their preferences and not as a whole. And always make sure to monitor and measure the increase in your customer engagement and conversion so you can repeat success.