Last updated on January 7, 2024

Image Credit: Yotpo Studio
Jacob McMillen
Website Copywriter & Email Marketing Strategist
July 18th, 2016 | 6 minutes read

The data speaks for itself: businesses that prioritize acquisition over retention are missing out.

Table Of Contents

We teamed up with eCommerce experts at Riskified. We pulled together our databases and got into the numbers to discover the true value of building customer loyalty.

While examining the data, we looked for which customer retention strategies really work, and we found that return customers will account for more than $1 trillion by 2019!

With that in mind, it’s high time for online businesses to have the conversation about customer retention.

What is a Return Customer?

Customers that return after their initial purchase to buy from you a second time are called return customers.

Why Your Customer Retention Rate Matters

Customer retention turns one-time shoppers into loyal lifetime customers.

To effectively prioritize customer retention marketing, businesses need to put sustainable strategies in place that keep customers coming back.

One way to increase customer retention is building relationships with customers that will go the distance.

This is where our study comes in. We wanted to figure out the most effective ways for businesses of all sizes to improve their customer relationship marketing.

Here you will see what we learned, including  five tips to optimize the online shopping experience for your site visitors and increase their trust in your brand in order to boost retention.

How to boost customer retention infographic

How Businesses Can Build Relationships with Customers That Increase Retention

Every stage of the customer buyer journey is significant.

Many people will visit your site, but only a small percentage will convert into leads.

Out of those leads, a percentage will convert into customers and another percentage will return to become return customers.

This last stage in the funnel – the rate at which your customers return – is a huge deal for your eCommerce business.


The value of repeat shoppers

Despite making up just 15% of online shoppers, return customers account for one third of all online shopping revenue and spend 3 times more, on average, than one-time shoppers.

In other words, when you convert a customer into a repeat customer, you are essentially tripling the lifetime value of that customer.

Knowing the value of repeat business, let’s look at a few key strategies for improving customer retention.

Customer Retention Strategy #1: Stop automatically rejecting shoppers

Stop automatically rejecting shoppers

In an effort to prevent fraud, many businesses put up all sorts of payment rules, filters, and other hurdles that buyers must navigate in order to make a purchase.

Sometimes, these efforts can hurt more than they help. An incredible 66% of declined orders by online retailers are actually legitimate.

Even worse, 1 in 6 US cardholders are falsely declined, many of them in high-value segments like Millennials (1 in 4)  or affluent buyers (1 in 5).

And what happens when a legitimate buyer is falsely declined? 66% will stop or limit their future shopping with that retailer.

All told, false declines account for $8.8 billion in annual lost revenue.

To increase your customer retention rate, make it easy for customers to purchase from you.

Strategy #2: Encourage customer reviews

Customer reviews lead to customer retention

Reviews are one of the most important growth strategies today for eCommerce businesses.

Lingerie retailer Adore Me was able to break into the Inc. 500 using a review-based marketing strategy, and they are just one of many companies today building their eCommerce businesses around user-generated content.

While many business owners are afraid of receiving negative product reviews, data shows that 72% of customers trust sites with a selection of negative reviews more than they trust sites showing only positive reviews.

The modern consumer knows that real people leave negative reviews, and they are looking for transparent, trustworthy brands that have nothing to hide.

Strategy #3: Invest in user-generated content

User generated content boosts customer engagement and retention

When it comes to the increasingly important Millennial generation, user-generated content has a significant impact on consumers.

User-generated content is anything voluntarily created by your customers and shared publicly – whether it be customer reviews, user-generated photos, social media posts, or customer Q&A.

User-generated content is authentic and it is reusable, making it a win-win for shoppers and businesses alike.

Shoppers trust past buyers more than they trust branded content because they have overlapping interests, common purchasing desires and similar pain points.

Reviews and user pictures that come from past buyers are more relatable and more relevant for shoppers making purchase decisions.

User-generated content can be incorporated throughout your website and repurposed across marketing channels, where they have a huge impact on traffic, sales and customer engagement.

Strategy #4: Optimize for mobile

Mobile optimization makes it easy for customers to shop again

Mobile traffic is an increasingly important source of new and returning business for online retailers.

More than 50% of online traffic now comes from mobile devices and this figure is expected to increase year over year for the foreseeable future.

While mobile sales still lag significantly behind desktop for US consumers (only 22% of sales), this gap – along with increased mobile interaction for other parts of the customer journey – presents a major opportunity for businesses.

Businesses can also take advantage of mobile users to acquire user-generated content and spread the word about their brand, as 40% of eCommerce user reviews come from mobile.

Strategy #5: Work to resolve issues

Customer satisfaction is key to retention

A bad experience with your business can be a significant deterrent to buyers, but what many businesses may not realize is that 95% of customers will return if a problematic issue is resolved.

Studies from the Harvard Business Review demonstrate that customers aren’t actually looking for an over-the-top experience.

What they do want is a successful online shopping experience – they want to receive what they are promised – and then they want any issues or problems along the way to be fixed in a timely manner.

A lot of businesses want to know how to win back customers, but they’re focusing on the wrong areas. Repeat purchases come when customers trust that if they have issues, you’ll be there to solve them.

You can increase repeat customers by making feedback follow-up and resolution a key part of your online conversion funnel.


The value of customer retention marketing can’t be overstated.

Building sustainable client retention strategies is definitely possible, but it does require that you make it an intentional part of your eCommerce marketing funnel.

Get started with some of the tips from this article…

How to earn more return shoppers:
1. Stop automatically rejecting shoppers
2. Encourage customers to write reviews
3. Invest in user-generated content campaigns
4. Optimize for mobile
5. Work to resolve issues