With competitive pricing already a strain for online shops, maximising profit means looking to leverage your existing customer base as much as possible. And, with the increasing costs of pay-per-click with competition, wouldn’t it be good to become less reliant on Google?
Customer Loyalty
It’s cheaper to keep customers than market to new ones so why not make the most of the ones you have? With databases and online profiling it’s easier to segment your customers into groups and direct your sales message using cost-effective online e-mail marketing tools, sending more targeted messages.
It means that when you send a sales offer, it can be more specific. The connection is that much stronger with your customer. They subscribed to that list so are more inclined to follow through any call-to-action. I did a project earlier this year which worked a beauty.
Personalisation
As well as creating targeted groups, you should also personalise your messages. Why not go one step further and send vouchers on birthdays or anniversaries?
Moonpig got me onto this a few years ago with a birthday calendar. I don’t ever forget a birthday now because I get an e-mail a week before the date and 9 times out of 10, I go to them to buy the card.
Leverage and Word-Of-Mouth
The key to personalised customer information is not to ask for too much up-front.
All the successful retailers online simply require an e-mail address and name to start with and move on from there. Don’t scare people off with lots of questions you simply don’t need.
As people begin to trust you (it’s all about trust), you can then leverage that trust by asking for recommendations; but only when they feel comfortable with you. At the end of the day it’s their reputation at stake, so they need to know that you will make them look good to their friends if they do refer you.
You can incentivise with referral schemes, vouchers and discounts, but people are much more canny than that, especially with their friendships.
A mixture works best. If they are prepared to refer you, offer them a voucher, and the person they refer. It lightens the load of expectation on all sides, because the financial benefit is shared. This makes it an easier buy-in for both parties.
Data Intelligence
The more you know about customers and their buying patterns, the more you can direct your sales message. It hails back to the one-on-one relationship shopkeepers used to have – “The Usual Mrs Perkins?”
With the sophistication of online databases, you should have this intelligence. An example for me was recently seeing that one particular customer ordered the same set of three skincare products, every three months on the beauty product website I run for a client.
If I direct a voucher to that person for those products at the right time, I am solidifying that customer as an asset. Yes, it costs me profit in the short-term, but I end up with a more engaged and loyal customer moving forward.
Sometimes, we concentrate so much on new business, we forget the assets we already have.
With a little concentrated marketing, we could be creating more business and more profit. We can also maximise word-of-mouth marketing, which is not only very powerful, it’s free.