Loyalty is a term that’s thrown around so often these days that it can seem inauthentic.
But when it actually comes to building relationships between businesses and consumers, loyalty is key for achieving higher retention, increasing customer lifetime value (LTV), and combatting rising customer acquisition costs (CAC).
So how can brands create an approach to retention and customer loyalty that’s holistic, incorporating the right mixture of strategies and tactics? How can they appeal to their unique customer base, whether that means giving special access to their brand, fostering community, or a combination?
While traditional, points-based loyalty programs may achieve some elements of this appeal, how can brands go deeper and incorporate a whole suite of tactics designed to cultivate stronger customer relationships?
In this playbook, you’ll find all the customer loyalty strategies that ecommerce brands should consider to create truly meaningful brand relationships that keep retention high and boost customer engagement.
- Ecommerce merchants should approach customer loyalty from a holistic perspective—focusing on a combination of strategies and tactics throughout the customer journey.
- Strong customer loyalty can lead to better LTV and increased retention.
- There are a variety of tactics for boosting customer loyalty, such as offering special access to your brand through memberships and personalizing the customer experience.
Why focus on customer loyalty?
Before we dive into customer loyalty strategies, let’s take a step back and talk about why loyalty is so important—which means spelling out all the benefits your company can take advantage of when you focus on creating better customer loyalty.
Cultivating loyalty offers a myriad of benefits for ecommerce stores. It creates a relationship with customers and gives them a reason to buy into not only your products, but also your brand mission or values. When you meet their needs and exceed their expectations, customers will naturally stay longer, buy more, and be happier.
While happiness is impossible to measure, the first two benefits—staying longer and buying more—impact several key performance indicators (KPIs) for your business, including:
- Higher customer lifetime value (LTV)
- Better customer engagement and satisfaction
- Increased average order value (AOV)
- Higher retention
Over the last decade, customer acquisition costs have increased by 222%, causing brands to renew their focus on retention efforts. This is where loyalty comes into play. Not only can you reduce churn by cultivating loyalty, but you can also boost revenue with higher customer lifetime value.
But what does loyalty really mean?
When discussing loyalty, unpaid loyalty programs are really just the tip of the iceberg. While they’re a great way to build loyalty among shoppers and keep them returning to make purchases with your brand, there’s more to loyalty than just rewards.
“There’s more to loyalty than just rewards.”
In order to truly create high customer loyalty and retention, ecommerce brands need to look at it from a comprehensive perspective. Each part of the customer experience can cultivate loyalty if the right strategies are employed—11 of which we’ll dive into later.
Building your loyalty strategy: Top things to consider
Before you start implementing new customer loyalty tactics, it’s important to take stock of what your business is already doing in terms of loyalty. This way, you can adjust your strategy and implement new tactics, while measuring your success based on the KPIs you’ve determined.
1. Assess goals & objectives
What do you want to gain from your loyalty efforts? Are you looking to boost specific metrics like AOV and LTV? Or do you want to grow your online brand community by a certain number of followers? Identifying the goals your company has is crucial to implementing the right customer loyalty strategies that will help you achieve those objectives.
2. Evaluate metrics & performance
Customer lifetime value is the primary metric ecommerce stores should keep an eye on when it comes to loyalty. As loyalty increases and customers stick around longer, their lifetime value increases.
Once you have an understanding of where your brand is already at, you will be able to measure your new progress. Evaluate the metrics you’ve identified to form a baseline, then make goals based on where you currently stand and where you’d like to be.
3. Gather customer feedback & insights
A major part of customer loyalty—general customer satisfaction and happiness—is inherently difficult to measure. Here, merchants must rely on the voices of their actual, real customers to gain an understanding of what’s resonating and what can be improved.
Gather feedback through customer surveys, read reviews, and see what shoppers are saying on social about your brand. It’s also crucial to analyze any written or verbal feedback from your customer service chats, calls, and emails.
When you get this insider look into what customers truly think about your brand and how they interact with it currently, you can form stronger loyalty strategies that center your customers.
11 strategies for building customer loyalty
Now that we’ve covered the benefits of boosting customer loyalty and the performance components brands should consider, let’s jump right in. Here are 11 strategies that ecommerce merchants can use today to increase their loyalty, and therefore build higher retention and revenue.
1. Create a strong brand mission
The brand mission is the heart of your business, and in turn, can become a huge component of your loyalty strategy. When ecommerce stores have a clear value proposition that guides them, it can attract customers that share the same values and will connect more deeply with their brand over time. It also gives your company a north star to return to, guides your efforts, and unites your branding under a central purpose.
“[A strong mission] gives your company a north star to return to, guides your efforts, and unites your branding under a central purpose.”
If we’re talking about traditional, free customer loyalty programs, the ones that are most successful are those with shoppers who are truly proud to be loyal to your brand. For example, brands that take eco-friendly initiatives could attract customers who value sustainability. Online stores with strong missions behind their products, or those that donate a percentage of their proceeds, will likewise attract customers with the same values.
But whether they’re part of your unpaid loyalty program or not, customers want to shop with brands whose missions they support and admire.
Take Bokksu, for example. They’ve created a wildly successful subscription box that delivers traditional Japanese snacks to your doorstep. But the items they include don’t just come from anywhere—they support family-owned businesses that have been operating for generations in Japan. This allows customers to support these businesses through Bokksu while enjoying their snacks each month—providing them with a sense of meaning in addition to enjoyment of the products.
Having a clear vision and mission as a brand can have an especially strong impact on Millennials and Gen Z, as these groups become an even bigger part of the consumer pool. Both generations are 90% more likely to purchase from purposeful brands—meaning ecommerce stores should create and share their mission.
2. Offer special access to your brand
In today’s world, store loyalty often goes hand-in-hand with access. And while traditional loyalty programs typically offer a number of benefits and perks for customers, memberships take that a step further.
Both subscription and non-subscription brands can take advantage of the benefits of memberships—one of the primary benefits being increased loyalty to your brand. With memberships, customers can pay a recurring fee to gain special access and perks, such as:
- Early access to new products and services
- Free shipping
- Members-only content and sales
- Members-only pricing
Memberships bind customers to specific brands—making them more inclined to make purchases with that brand because of the perks they receive, like discounts or special offers.
Herd & Grace has a successful membership program that offers significant savings and benefits for just $15/month. Members receive discounts, shipping credits, a welcome gift, and other members-only perks that make signing up a no-brainer. The membership practically pays for itself with each purchase members make.
Creating a meaningful membership program that adds value for the customer, as Herd & Grace has done, can lead to long-time brand loyalty and a solid, loyal customer base.
3. Utilize user data to increase engagement
When your brand stays on top of analytics, especially as they relate to customer retention, you can find unique ways to increase loyalty and decrease churn.
In other words, with certain tools and automations, you can more quickly and effectively discover the reasons your customers need to remain loyal to your brand.
For example, say your team notices that a high number of customers have been churning after their third order. To negate this churn, try sending them a free sample or a discount code on a product one or two orders before. With Recharge Flows, merchants can use A/B testing on different offers and incentives to see how well they work, and if they are preventing churn.
Flows allows merchants to personalize the customer experience and enhance it by testing and iterating to see what drives the most revenue. Merchants can also use Flows to optimize these customer touchpoints—making the customer journey more exciting and leading to higher retention.
Ecommerce stores should also consider the different types of incentives they can use to get customers to return. They could offer a free gift if they come back and subscribe, or give customers a $5 credit to spend at their store. Recharge Loyalty empowers merchants to retain customers by offering store credits for refunds and creating cash-back programs to reward customers.
4. Engage in online community spaces
Humans crave connection—even if it's a connection online with a brand. They want to feel that special bond with your brand, which is why engaging in online community spaces is so crucial for building loyalty and boosting retention.
When brands acknowledge and engage with customers through public channels, like social media, it can make customers even more motivated to continue making purchases and sharing about them.
Ecommerce merchants need to take a look at where their target demographic is spending time online. Is it in Facebook groups, or on TikTok? Meet both your new and existing customers where they are so you can engage with them organically.
Or, follow the example of Recharge merchant Mixhers and create your own community. By allowing customers to engage with each other and your brand, you can build trust and easily answer common customer questions in a forum setting. Plus, online platforms are a great channel for sharing helpful resources and information with your customers.
5. Offer quality content across channels
These days, customers don’t just want to buy a product and have that be the end of the story. They want to have a relationship with your brand and build connections. So, to build customer loyalty, brands should focus on creating an all-encompassing brand experience through quality content shared across all channels.
Blume does a great job of creating this full customer experience. As a brand committed to “setting a new standard for skin, body, and period care,” their blog is full of information for their target demographic. Whether people are looking for information on how to have healthy skin or how to support a friend who’s depressed, they have resources for everything. It’s easily accessed on their site, and creates a community of inclusion for their customers.
“Knowing a brand isn’t just there to sell them products, but also help customers through important moments in their life, is key to creating high customer loyalty.”
6. Optimize the customer portal
Another tried-and-true customer loyalty strategy is to optimize your customer portal. Making it easier for customers to manage their orders and subscriptions can have a direct impact on reducing churn and increasing customer retention, thanks to:
- An improved user experience
- Increased customer engagement
- Better customer support
Recharge merchants can take advantage of the new Affinity customer portal theme, giving them access to no-code customizations with this out-of-the-box solution. The mobile-friendly, intuitive design makes it easy for customers to manage their subscriptions on the go, leading to greater flexibility and customer satisfaction. The benefits for your business can be monumental—for example, simply allowing customers to pause their subscriptions can decrease cancellations by 10%.
Jimmy Joy, a plant-based meal brand based in Europe, saw great success after updating their customer portal. They were looking for a solution to provide more customization and features for customers looking to manage their orders. Since they implemented the Affinity portal, they’ve seen an 8% increase in AOV and a 7% churn reduction—showing a direct correlation between an optimized portal and increased customer loyalty.
7. Personalize the customer experience
With all the technology available today, customers expect a personalized shopping experience. The right personalization strategies throughout the customer journey can lead to higher retention rates as you offer customers options that are specific to their needs. There are four specific ways you can use personalization to boost loyalty and revenue, which we’ll dive into below.
Surprise & delight
Personalized touches will always make a customer feel special, especially when they arrive when they least expect it. With surprise and delight tactics, merchants can improve loyalty by rewarding customers with no strings attached. Plus, by continuing to test and iterate these surprises, merchants can increase LTV and customer loyalty, all while making their customers happy.
Cross-sell & upsell
Cross-selling and upselling are two of the best personalization strategies merchants can take advantage of, and are proven methods for increasing AOV and loyalty. When you show customers product options that complement items already in their cart, or are a more enhanced version of something they’ve already purchased before, it shows you know your customer. This leads to better trust and loyalty.
A pet store wouldn’t show the same product to a dog owner as they would a cat owner, right? The same goes for any kind of product. With customer segmentation, you have another opportunity to prove that you know your customers and their needs. Segment customers based on demographics like age and purchasing habits and you can show them the right options that will lead to more sales and satisfaction.
Bundles give merchants the opportunity to combine multiple products into a set, adding another layer of personalization to the customer experience. Allowing customers to build their own bundle of products means they can get exactly what they need, and often at a discount compared to purchasing the products separately. Plus, merchants can use data to create attractive bundles based on what customers have purchased together in the past.
8. Offer responsive & helpful customer service
Maintaining and growing customer loyalty is also possible with responsive customer service. Customers need to know they can easily get help when they need it, have questions answered, and receive support when having issues.
Some of the most important ecommerce website features are those that offer support, including:
- Chat software
- A Help Center
- An FAQ page
- Assistance via text and email
- Multilingual support
With responsive customer service through channels like online chat or email, you can mitigate churn and build loyalty. Customers will be more willing to return to your store if they know you will help them when they run into issues. Merchants should also focus on training their customer support team so they can effectively handle customer issues in a timely manner.
For online stores that need additional support, there are tech partners that can help them improve their customer service game. Gorgias offers customer service management all in one place—chat, email, and even social media. For interactive chat options, Blueprint integrates with Recharge and can help you reduce churn through quick responses. Offering customers these fast and helpful solutions will build loyalty as you increase retention.
9. Manage disloyalty
Ecommerce merchants should also have a strategy in place for managing disloyalty, like negative reviews or support tickets.
If unsatisfied customers aren’t getting the help or attention they need, it will only lead to churn. So for brands looking to boost loyalty, here are a few tactics for managing disloyalty:
- Collect cancellation reasons when customers do churn
- Have a designated approach for responding to bad reviews, especially those that are public-facing
- Resolve unsatisfied support tickets in a timely manner
Brands should also consider launching a win-back program that’s differentiated for their loyal customers. Say a shopper ordered twice, but didn’t come back for a third order. Your win-back campaign would be very different from someone who made ten or more regular orders then suddenly stopped. Loyalty will naturally improve when you keep customers happy and supported.
10. Show empathy to existing customers
Loyalty strategies should, of course, have a focus on existing customers—those you’ve already acquired. Merchants can gain a lot of wisdom and insight from these customers, too. Talk to shoppers and see what they like and don’t like, survey them to gain new ideas for products or marketing strategies, and keep them front of mind in every decision you make.
Simple actions from a brand can go a long way. For example, Chewy sends customers a card when they remove an animal from their account. They’ve also pulled a whole line of dog food after a customer wrote them to say the food was making their dog sick. Going the extra mile, they also sent a note to all customers who had ordered that food, letting them know what happened. Putting empathy first in every interaction with customers can naturally build a loyal customer base.
Merchants should keep in mind that these special actions don’t have to be exclusive to your loyalty members. However, adding an extra touch like a handwritten card could help your brand go beyond for your most loyal customers. At the end of the day, companies that treat customers like friends and empathize with their losses will have the highest loyalty.
11. Celebrate milestones & reward loyal customers
Last but certainly not least, customer loyalty should be rewarded. This leads us to our final strategy, which is to celebrate milestone anniversaries with your loyal customers.
Make it more personal by framing your rewards around your products. For example, say you sell smoothies on subscription, like Bumpin Blends. When someone celebrates their third month with you, congratulate them for achieving three months of healthy breakfasts. It’s always great to give rewards like a free product or a special discount to celebrate these milestones.
Inspiration gallery: Recharge merchants with successful loyalty strategies
To close, let’s take a look at two Recharge merchants to discover how these loyalty tactics work together. Both merchants have created comprehensive loyalty strategies that make customers feel special, heard, and included—leading to high loyalty and retention.
In terms of looking at loyalty holistically, Bokksu is one of many Recharge merchants that truly knocks it out of the park. As we talked about previously, Bokksu has a strong mission of supporting family-owned businesses in Japan through their popular snack subscription boxes. Other ways they build and maintain great customer loyalty include:
- A subscription program with flexible plan options
- Maker stories that showcase their wonderful artisans
- An unpaid loyalty program that rewards customers with points
- Rewards for referring friends and family
- A blog that thoroughly covers Japanese culture
- Active social media accounts that share information and engage with customers
- An FAQ page and helpful support directly on their website
Merchants like Bokksu that have taken this holistic approach to engaging with their customers can naturally build loyalty among their customers through a number of ways. By creating this experience that goes far beyond just their products, they’ve built a community of loyal and committed customers.
Blume is another merchant that deserves praise for building loyalty with a multi-faceted approach. They have a thorough blog, as we highlighted above, full of information for their customers around topics they might be interested in. They also have a free loyalty program called Blumetopia, in which customers earn Blume Bucks to spend on future purchases. Some other ways they foster loyalty are:
- An email newsletter with tips and videos
- How-to articles on their site for their products
- Super helpful customer service (I’ve personally experienced how fast and responsive they are!)
- A lot of press mentions that build brand trust and awareness
- Products offered on subscription
- Rewards for customers who share their products on social media
As a brand with a big Gen Z customer base, Blume really takes things to the next level for this demographic. With beautiful products that come in eco-friendly packaging, they connect with their audience in a way that makes shoppers feel seen. Plus, by engaging on social media and sharing resources, they help customers with more than just their skincare products.
Build customer loyalty & increase retention with these strategies
Creating a holistic loyalty strategy is possible—and necessary—for ecommerce merchants looking to increase retention and build better customer trust. By combining a number of strategies and building a customer experience that goes beyond just products and services, your online store will naturally win and keep more customers.