Why are you Ignoring Current Customers to go after New Ones?

It’s not a secret that returning customers are better for your business than new customers. Studies have shown that a returning customer is less expensive to convert and has a higher average order value than a new customer. Yet, many retailers are focused on utilizing total sales and comp sales to measure company performance instead of measuring customer loyalty and retention.

According to BRP’s soon-to-be-released Digital Commerce Survey, most online retailers have key performance indicators (KPIs) for sales, average order value, comparative sales and conversion rates; however, less than 50% of retailers measure customer loyalty through customer satisfaction (net promoter score), customer retention and post-purchase customer survey results.

After a customer clicks “buy,” they enter a phase of uncertainty, where they are unsure whether their product will arrive on time or whether it will appear in one piece. Retailers who communicate regular updates and reassurances on the order and delivery status to customers can turn this period into a powerful moment of trust for the brand. Customers who shop without a sense of risk will feel more comfortable making repeat purchases in the future. This breeds customer loyalty.

According to the recent Best Practices for Enhancing the Post-Purchase Experience report your customers’ most recent experience with your company impacts the feelings they share with friends and family and the relationship they have with your brand. The satisfaction level during the post-purchase experience has a direct correlation on a customer’s decision to buy again, or not. Retailers that meet or exceed post-purchase customer experience expectations create a unique brand experience that customers will “share” with others personally and on social media. Exceptional post-purchase customer experiences inspire customers to build long-term relationship with brands.

Understanding the value of loyal customers and repeat purchases is critical to fostering higher lifetime customer values. Focus on making your current customers happy with your brand and see how that benefits your business.

As always, I am interested in your opinions on this topic.  Please share your comments below.


Jeffrey Neville

Senior Vice President and Practice Lead
Jeff is a business focused technology strategist with a passion for generating company results through process change and technology innovation. His experience includes both managing e-Commerce and SaaS businesses and consulting with clients on their growth strategies, business and operating models, customer and market strategies. Jeff also has extensive experience in helping IT and Engineering organizations make the transition to agile development and DevOps methodologies.

Jeff’s combination of consulting and operating experiences in North America, the EU and China enables him to bring a unique perspective to business challenges when partnering with his clients.

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