Customer loyalty funneling in ecommerce

There are many potential benefits of customer loyalty funneling, especially within the most heavily saturated niches of the e-commerce field. Here, groups of mid-sized and large e-tailers with big revenue and little margin relentlessly compete for customers attention.

Cutting costs through customer loyalty and individualized retention campaigns

Loyalty funneling, to us, is a term indicating a focus on customer acquisition and retention through loyalty building activities such as events, target group adapted campaigns, and of course, a good rewards program software, just to make that clear from the start.

As the preface mentions, there is heavy competition in most local european e-tail markets. The natural focus in that repeat process of keeping up your revenue, of course, becomes new customer acquisition. You want to own that customer, you want the customer to register and become one of those plus variables in your RPR statistics, a real repeat customer that always turns to you first.

However, most customers have no reason to stick with you, for the simple reason of you not having the lowest prices on products or shipping every time around. That fact, combined with increasingly expensive paid marketing channels (Google Adwords & friends) makes for a reality where economically viable customer acquisition is becoming tricky.

Creating wine out of water

So, lets instead create wine out of water. Let’s make registered customers work for us and register their friends on our site, instead of us having to do all that costly work. When using a software like Pinguin, you can easily identify and incentivize potential customer acquisition aces among your existing customers.

A well constructed campaign, where you have figured out the transactional value of, for example, a customer inviting a friend, for a specific target group, makes for a situation where your acquisition cost comes at the transactional value total sum, which might be as little as the cost of giving away a t-shirt.

Improve customer experience with empowerment & social

A plus that comes with producing invitational campaigns and leveraging a rewards module with gamification-based functionality, is an improvement in the perception of empowerment that each individual customer can experience. Sounds like fancy words, but gamifications impact on key KPIs such as number of sessions and session duration is very real. If performed correctly, a change in funneling focus, from new customer acquisition to customer loyalty & retention may lead to customers surfing your site looking for new available rewards, before even thinking of wanting to buy something specific. That is a very clear change in audience behaviour, which makes for clear cuts in customer acquisition costs.

These are just some of the benefits of customer loyalty increasement initiatives, read more about our favorite subject (customer loyalty in ecommerce) throughout our blog, or contact us through a form to get started wotking in Pinguin 🙂