A friend with a successful b-to-b eCommerce business posed a simple question to me: “If you could only do one or two things for an ecommerce business (that sells actual products rather than a service or software or something) to increase customer retention, what would you recommend?” Here are my recommendations, in priority order. What are yours?
- Place your web address, with a compelling call-to-action, directly on the products being shipped. Make this call-to-action as time-sensitive as possible. Don’t be lame and do include a deadline. NO: “Fill out our warranty card online.” YES: “Set up an email reminder on our site so you’ll never forget to replenish. Do it by [date] and we’ll give you an automatic 10% off your next purchase, and free shipping!” Enclose a card reiterating the offer. This may be your last best shot at creating a repeat customer.
- Follow up your shipment with a “We’d like to know if your products are fitting your needs” email or letter. Include a customer satisfaction survey that rewards them with something they can use with an immediate order. If you’re using snail mail, naturally you should enclose a printed catalog. Draw their attention to related items that can be found within it (or if it’s an email, found on the eCommerce site). If possible make the effort self-financing by generating an immediate re-purchase. Use the Net Promoter Score (NPS)* methodology in the satisfaction survey, to track current loyalty for this customer and as a way to track overall likelihood to repurchase as a trend over time.
Those are my recommendations. What are yours? Comments are especially welcome, for me and my friend.
*I’m including this because, although NPS has fallen out of favor as a predictor of company growth, and in other ways is definitely not perfect, I agree with Dale Wolf in that I like its simplicity. You need to use something as a predictive baseline that can (hopefully) be compared with real loyalty measurements. The NPS methodology, associated with Satmetrix Systems, Inc. and Fred Reichheld, is good enough to do the job.
5 Replies to “What b-to-b customer retention changes would YOU recommend?”
It’s hard to be real specific without knowing the type of product, and the frequency with which that product is typically purchased…
…but my take is that anything improves the “value” of the product to the customer would be a step towards improving retention.
So, for example, could your friend write a white paper that highlights how customers are using his/her product in non-obvious ways, perhaps to save costs in certain areas of their business?
What about metrics or benchmarks associated with the use of the product? Most businesses have little insight into what other firms are doing.
That’s my $0.02.
Does collecting data increase customer retention? Or does it create the sense that your customer is engaged?
I agree with your suggestions, but not so sure I’d put them up as the 1 or 2 things to improve customer retention.
#1 on my list is communication. Regular, predictable, valuable communication. Newsletter, blog feed, promos, US Mail, etc. Stay top of mind and be first in line.
#2 on my list is tied to Ron’s comments, as it’s dependent on the type of product(s) being sold, who they are being sold to, and how often they’re likely to be purchased.
How about creation of an exclusive Buyer’s Club? In return for some key demographic data, you give them access to exclusive promos/coupons, product bundles, free shipping, etc.
Can you supply any more detail? I’m sure we could figure this out! 🙂
I know it’s old school, but in a down economy, I think quantity discounts, discounts for long-term commitments, and packaging similar products together (even with 3rd-party partners) is a strong B2B tactic.
Of course, there’s also Social Media. Using Twitter and appropriate online communities to prospect for those expressing need, to service those with complaints, and to offer occasional short-term promotions seems a cost-effective solution for B2B marketing these days. I just saw a study that indicated more B2B marketers were on Twitter than B2C!
All good suggestions.
Here are a couple more thoughts:
1. Improve their experience on your site. This sounds too basic, but many companies do not do it well. The shopping experience has to be quick and easy; thatâ€™s a given. But also consider targeting your B-to-B customers with things like personalized URLs and focusing strongly on their â€œMy Accountâ€ data. Beyond simply greeting the customer by name (when you can), this accomplishes a number of things such as:
a. Allows the site owner to know not only what company buys what, but who the actual individual is. It is often difficult in B-to-B sales models to distinguish among who influences the purchase, who directs and pays for the purchase, and who literally places the order. It would be nice to be able to identify and message to all of them personally and individually. Especially when there is turnover within the business, itâ€™s better to maintain relationships with multiple people, rather than generic transactions with a job title. And if that person moves on to a new company, you have a warm lead.
b. Allows for personalization and targeting of products and services based on actual transactional history and an understanding of their business and needs
c. Leverages any recommendation engine technology they may have in order to cross-sell and upsell
d. When working with multi-unit/multi-department customers, the individuals within those companies often donâ€™t know or canâ€™t track any overall corporate purchasing agreements or contracts that allow for discounts or rebates. Having the database manage contract terms and other language assures that everyone gets the best deal they are entitled to (without doing any additional work), lets them see their savings, and therefore could lead them to purchase more than they would originally have considered.
e. Gathers valuable customer and industry data that can be leveraged in future sales and marketing strategies.
And the list goes on. Obviously this assumes that they have the requisite backend infrastructure to manage this, but that can actually be outsourced. Customers would need to log in to purchase, but will appreciate still being engaged by a site that understands them and seems to be working with them the minute they arrive.
2. I agree with Augie that discounts work. We also use a slight twist on that theme: threshold spending. We work on strategies to apply incentives based on bumping up the average order value. If, for instance, the RFM data tells us that your customer never spends more than $100 per transaction, we will suggest offering them something in return for spending $125 or $150. The deal gets even better if they spend $200. Though their budgets may be set for the quarter or the year, when they spend that money during the quarter or year is typically less strongly dictated. If their perception is that they can get more for less by buying now rather than later, they usually will. They get better value, and the seller improves current cashflow.
What ties all of these together is a focus on the customer’s needs and expectations — especially where customer service and matching needs with product offerings are concerned.
I’m intrigued, Mike, by your comment about boosting average order size. My experience has been that a marketer is more likely to get additional purchases at similar order sizes than significantly larger next-time purchases.
Ron, Rick, Augie and Mike: Thank you all. I’m impressed with the variety and your contributions to the discussion are much appreciated!
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