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7 easy ways to increase the profits of your online store

7 easy ways to increase the profits of your online store

Boosting your store's profitability is vital to growing your business. Metrilo shares how you can increase profits by converting your customers into loyal brand advocates.

By Guest Author 21 January, 2021

Improving your ecommerce store’s profitability can bring you long-term success. Profitability is what allows you to order more stock, develop new products, expand into new markets, hire staff, and reach more people. Basically, it helps your business grow in a financially sustainable way. Many ecommerce entrepreneurs take a page from Amazon’s book and forgo profit for growth, investing in new customer acquisition. However, what most entrepreneurs don’t have is the access to capital Amazon has so they cannot sustain this breakneck growth forever.  

What can you do then?

Make sure you make a decent profit on each sale so you can afford to grow and expand. And how to achieve that? Profit is what is left after expenses on selling the product. The less you pay to make the sale, the more you earn. The easiest way to sell more without paying is selling to existing customers, a.k.a. customer retention. By using your first-party data to engage your customers in a relevant way, you can convince them to shop repeatedly, making a better return on investment.

In this article, you will find 7 tactics to drive repeat sales and improve your ecommerce store’s profitability as a result.

1. See what products drive loyalty and push them more

Naturally, some products create more customer satisfaction and loyalty than others. It can be the quality, your marketing or just this product’s target group best identifies with your brand. A simple retention analysis should show which of your products manage to rack up a retention rate above your store’s average.

Maybe they’re not the bestsellers or the ones with the highest conversion rate, but they continue working for you long after the first purchase. When people have loved them, they come to shop for more.

Having such products is a great opportunity for increasing your profitability. All you have to do is promote them harder once you identify them. Feature those “superstars” more in:

  • social media images;
  • influencer campaigns;
  • emails;
  • ad visuals;
  • referral mentions such as holiday gift guides in magazines.

The more people are exposed to those products, the more orders - and therefore, more potentially loyal customers.

@bahkadisch studio features their popular plate front and center on their Instagram and shop

2. VIP customer treatment

People would shop from you more if they feel special and appreciated. Treating returning customers with care is simple, yet potentially powerful for increasing your profits. The more people love your brand, the more they’ll talk about it and bring new customers for free in addition to contributing revenue regularly.

VIP treatment can be a lot of things depending on your resources:

  • Early-bird access to new products and deals
  • Asking fans to help you pick a color or a name for a new product
  • Putting stickers or other freebies in their orders packages to make the unboxing even more enjoyable
  • When they do browse abandonment - look, but don’t buy - send them a coupon code for the products viewed. This way they’ll get a good deal and you won’t be discounting too much to everyone, only to really engaged and loyal customers.
  • Provide fast shipping and free returns and exchanges
this packaging by @augustrivers makes every customer feel like a VIP 

3. Use tailored content to drive engagement

Content can be great for keeping people engaged with the brand. It can help them use the purchased items more effectively, resulting in greater customer satisfaction. Happy and regular customers are the holy grail for ecommerce businesses looking to grow more profitably.

The best practice is to tailor the post-purchase content you send for maximum relevance. Simply segment your customer base by product bought before you send a post-purchase engagement campaign.

Then, the content can be anything that encourages use: inspiration from other users, alternative DIY ideas, expert videos, maintenance tips, etc.

source 

ILIA, for example, sends this to people who buy the Multi Stick product and casually mention a complimentary product as well.

4. Discount code for next order

This tactic is widely used exactly because it works in driving revenue and profit. A printed coupon or a code in the confirmation email is the easiest way to make people come back to shop again. They know a deal is waiting for them and feel like missing out if they don’t redeem the coupon. Add an expiration date and the conversion rate will go up.

Source 

Some brands regularly include such printed coupons in their orders, but that turns counterproductive when too many people receive it or - worse - the code does not change and everyone memorizes it. So vary your codes, send them to customers on some criteria - every 3rd order or as thanks for a very large order.

5. Timely reminders

In order to drive repeat sales, you need not annoy your customers. Constant showering them in emails is futile and might even have negative effects. What’s the right approach to email marketing then?

Schedule your reactivation emails for the time when people are willing to shop again. To find this magic spot, look at your average time between orders. Depending on your products, it can range from days to years, but it’s typically a few months. A recent study on DTC brands found 102 days, to be exact. If you ignore the natural buying cycle of your customers, you risk sending emails that will be ignored because people don’t need to or don’t want to shop at that moment. Imagine a coffee brand sending replenishment emails every day. It’s useless, people buy bags of coffee beans for at least a week and more often, a month.

source

So, plan your win-back strategy according to customers’ shopping habits. Before they’re ready to shop again, it’s a waste of effort. After, you might have lost them to the competition already. If they usually shop with you every 50 days, send your offer at the 45th to get them thinking about your brand again. Then, give them an even better deal or terms or freebies on the 50th. This tactic means communication just on time and should convert really well.

6. Samples

Keeping customers excited about your products and brand is essential for retention and therefore, for your store’s profitability. How can you make people constantly order your new products? With samples!

Everyone loves samples. They’re free and they make a pleasant surprise. But above all, they’re a risk-free way to try out a new thing without thinking too much. Beauty, food, drinks, and home goods are some categories that can rely heavily on samples for driving repeat sales.

If you cannot sample the products you sell (jewelry, wedding gowns, shoes come to mind), a related freebie also works. A key chain or a shoe polishing kit work the same way as a mini face mask to make people like your store more.

beauty company glossier offers small free samples with each purchase source

7. Make referrals easy

As mentioned before, good customer experience travels a long way. People love talking about their latest finds and feeling like influencers among their friends. To help them spread the word about you, use your packaging - a  free marketing channel that you own!

If your mailer boxes or bags are cool, branded and memorable, people will keep them and reuse them for storage. Tissue paper can also find alternative uses, spreading your branding beyond the immediate buyer of the item.

But the ultimate inserts that facilitate referrals are stickers and cards. They’re easily gifted to someone else (with or without the ordered item). They can also feature a QR code or a coupon code to convert a new customer.

@aruallhuillier

Conclusion

The tactics outlined above aim to retain your customers so you get more revenue without investing in extra ads. They rely on creating customer loyalty for improving your store’s profitability. The best thing is that you can steal the ones you like and that fit your strategy, and they’ll start working for repeat sales, no complex planning needed.


Dimira Teneva is the Content Manager at Metrilo. Metrilo is an ecommerce analytics, CRM and email marketing tool in one, helping ecommerce brands grow.