Every merchant out there is running campaigns to drive more people to their online store and acquire more customers. But the top Shopify stores are focusing more on their customer engagement strategy to boost their retention rates, growing a lot faster than those targeting acquisition only.
While you might know what repeat or active customers look like, in this article we’re going to share everything you need to know about customer engagement. Right from what it is, why it should matter, how you can measure it to how you can work towards improving your customer engagement strategy.
What is customer engagement?
Customer engagement is defined differently by businesses. But it mostly refers to the ongoing interactions between a company and a customer, and sometimes, even the customers themselves.
The Facebook page like you just got or the like you received on one of the posts. The message your live chat just received. Every action where a customer is interacting with your business in some way is engagement.
Now you might be wondering if all that is happening on its own do you need to focus on creating a customer engagement strategy? The short answer is, yes. Let us explain why.
Why is a customer engagement strategy important?
According to the Hall and Partners’ Engager model published on Market Week, two-thirds of a brand’s profits rely on how active their customer engagement is.
Another study published on the Constellation Research claims that companies that focused on increasing their engagement rate saw:
- 22% increase in cross-sell
- 13% to 51% increase in up-sell
- 5%-85% increase in order sizes
1. Customer engagement increases purchase frequency
Do you ever go back to a brand’s site with absolutely no intent to make a purchase and still walk away ordering a few items?
Shopify and many other studies call this an impulse purchase, and it is a lot common than you think. A whopping 49% of your shoppers make impulse purchases just because of engagement strategies like personalized recommendations.
Take for instance your experience on Amazon. The reason why the eCommerce giant focuses on personalizing the site experience for every shopper is that it leads to more sales. Amazon shared how their recommendations are less about their sales goals and more about the individual needs of a customer.
Simply put, understanding a shopper’s preferences and putting the data to use is the key. Keeping them engaged with what interests them the most automatically increases the purchase frequency.
2. Customer engagement increases revenue
Your focus on keeping them engaged with valuable content like offers or product recommendations, nudge shoppers to come back to your store more frequently. The more frequent their visits get, the higher are the chances of them making a purchase.
And when 49% of your shoppers are displaying that behavior, your revenue is bound to increase.
InMoment shared that 61% of your customers will go out of their way to buy from your brand when engaged well. 60% will make frequent purchases, and 50% will purchase more products than a newly acquired customer.
3. Customer engagement reduces returns
When you engage shoppers with relevant content and personalized recommendations, there are lesser chances of them making an uninformed purchase. This reduces the number of purchase returns you get over time.
If you’re wondering how an impulse purchase can be an informed one, the answer is simple.
The impulse purchases have less to do with the shopper’s emotions and more to do with the need for the products you’re recommending. Only 5% of impulse shopping results in a bad experience or as we know it, returns. When backed by a customer engagement strategy that focuses on helping shoppers make an informed purchase, you can guarantee a higher rate of satisfaction and fewer returns – even on impulse purchases.
4. Customer engagement boosts brand loyalty
With an increased purchase frequency, reduced number of returns and high customer satisfaction, it is safe to say that you have a happy customer. A happy customer is one that will come back to your brand no matter how many other options they have in the market.
Simply put, all your efforts in customer engagement boost your brand loyalty. And studies suggest that 12-15% of loyal customers, represent 55-70% of sales.
How to keep your customers engaged?
The attention span of an internet user is comparable to that of a goldfish. Now considering just how many online stores a consumer can buy the same product from today, it is becoming hard to keep them engaged. But here are a few tactics that always work.
1. Humanize your brand on all platforms
You might be wondering why this even counts as a strategy. The truth is 79% of consumers choose to interact with human-driven brands. Right from their first point of contact to the customer service they want to avail, they are more engaged when communicating with someone they can relate to.
That’s why your online store needs to reflect your brand’s personality. The personality is the tone you use across all customer touchpoints – your website, social media, emails, advertisements, and other platforms.
The most common tones of voice commonly used by brands include:
- Empathetic and reassuring
- Unexpected and witty
- Energetic and fun
- Simple and straightforward
- Charming and flirty
- Loving and trustable
- Suspense and click-bait
For example, Innocent Drinks maintains an unexpected and witty tone on social media.
And they follow the same tone in web push notifications sent to their customers.
2. Include content in your customer engagement strategy
67% of the buyer’s journey is complete before they interact with your brand. To be able to make an informed decision, they use the search engine to look for products they want to buy. This exposes them to the reviews and ratings you have been given, and articles that share tips on how to use that specific product.
One way to engage an existing customer is to continually address their need for informative content. Help them see the value behind products they have already purchased or are planning to buy.
A good example here is Shopify. They write articles about how users can leverage their platform. But they also focus on sharing information around how they can grow their stores. Right from getting more followers, acquiring more customers, engaging and retaining them, you’ll find all the important resources on their blog.
Their goal is pretty simple: Become a go-to source of information.
Similarly, you can include informative content in your customer engagement strategy.
Instead of always trying to reach out to customers with products to purchase or deals, use how-to videos, season trends and other formats of content to add value to them and keep them engaged.
Use all your informative content on social media, email, in web push notifications, and on your site. Let the customers feel your aim is to help them make a better purchase.
Social media gives you the opportunity to interact with your audience where they are the most active. So why just create another brand profile on Instagram, when you could actually create a growing community for yourself on the platform?
Here’s what we mean.
Use your profiles to share snackable bits from your content with your audience and encourage a conversation. And don’t miss an opportunity to leverage user-generated content. You should never underestimate the power of a well-branded hashtag!
Take, for example, Made.com. Even their bio is all about encouraging their customers to share their purchases and experiences with the brand with them. Their feed is beautiful curation of their own media and user-generated content.
4. Reach out with web push notifications
Don’t wait for a customer to visit your online store on their own or through one of your social media posts. Considering the number of posts published by brands daily, there’s a high chance they don’t even see the content you were hoping would drive them back to your site.
Reach out to these customers using web push notifications. With push notifications, you get to engage customers who aren’t on your site in real-time, irrespective of the device they are using. They get delivered on their device screen directly, making your messages hard to miss.
Use this channel to promote your recent content pieces, or to offer them an additional discount on a product range they were browsing last time.
5. Make your emails more engaging
Similar to web push notifications, reach out to your customers on emails to keep them engaged. But remember to base your messages on the shopper’s data – their last interaction, their on-site behavior, previously purchased products and more.
In fact, you should automate 7 types of emails immediately:
- Abandoned cart emails
- Welcome emails
- Nurturing emails
- New customer emails
- Repeat customer emails
- eCommerce receipt emails
- Re-engagement emails
For example, Uncommon Goods knows that online shoppers don’t necessarily make a purchase on their very first visit. Using nurturing emails, they use the channel to share information about their brand’s vision and mission.
We all know how your target shoppers are spending most of their time on social media. Besides running an active brand page and a community, use the platform to retarget your customers.
You can serve ads to remind customers of the products they recently browsed, recommend new products or nudge them to complete the purchase of an abandoned cart. You can also use Facebook ads for sequential retargeting to guide your customers through different stages – from browsing products to adding them to the cart, to finally making the purchase.
This way even your retargeted customers will see different ads as they move through the funnel, instead of being pushed to purchase with one. No more ad fatigue!
How to measure customer engagement?
While the above tactics have proven to engage online shoppers, the results vary from brand to brand. That’s why you need to measure the impact of each customer engagement strategy to optimize what works the best for you. Here are a few numbers you should be keeping a close watch on:
1. Account signups
Identify how many users are signing up for an account on your Shopify store to complete a purchase. Fewer the guest checkouts, the better it is as you have more data to use for customer engagement.
2. Purchase frequency
This metric will give you an idea of how many times a shopper comes back to your store. Higher the purchase frequency, the better it is!
3. Average order value
An engaged customer is someone that trusts your brand is more likely to place high-value orders. Calculate the average order value to see how well you’ve been able to connect with the customers. Again, an upwards graph is what you’re targeting.
4. Customer lifetime value
Calculate the customer lifetime of your shoppers to predict the net profit attributed to each customer. This will also help you identify if your brand has been able to make a strong enough connect with its customers.
5. Retention and churn rate
The whole idea of having a customer engagement strategy in place is to avoid customers from walking away. So while your retention rates should be shooting up, it is essential to keep a close watch on the churn rates – keep them as low as possible.
Keeping your customers engaged
With the increasing competition of stores on Shopify and a rising customer acquisition budget, it is customer engagement that is the real growth hack for success.
So no matter what stage your Shopify store is at, it is time to implement a customer engagement strategy from day 1!
Remember, losing a chance to interact with an online shopper, is like losing a customer.