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<h3><strong>In this edition of our #EcomInsights series, we spoke to Lawrence McNeill, Senior Channel Business Development Manager at Yotpo, about how brands can enhance their retention efforts and maximise the lifetime value of their customers.</strong></h3>
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<div style="text-align: left;"><img src="https://cdn.shopify.com/s/files/1/1472/1782/files/EI_Newsletter_2f222537-7376-42f3-a126-4ba82a2e1676_1024x1024.png?v=1687173640" alt="" style="margin-right: auto; float: none; display: block; margin-left: auto;"></div>
<p><br><br>Welcome to #EcomInsights, the series where we speak to the industry’s best-known tech tools and platforms about how brands can tackle challenges facing the ecommerce industry. <br><br>In particular, we’re looking to ecommerce experts to address the problems presented by the current economic climate, offering advice to help brands tackle rising customer acquisition costs, boost retention and enhance loyalty.</p>
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<br><br><strong>Tell us about Yotpo.</strong>
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<p><br><br><a href="https://www.yotpo.com/" target="_blank" rel="noopener noreferrer">Yotpo</a>’s ecommerce retention marketing platform enables brands of all sizes to strengthen their relationships with consumers. With unified, data-driven solutions for loyalty, SMS marketing, reviews, subscriptions, visual user-generated content, and more, Yotpo helps brands like Princess Polly, Rothy’s, Moroccanoil, and Steve Madden deliver winning, cohesive experiences that drive ecommerce growth and customer retention.</p>
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<br><strong>Why is customer retention an area brands should be focusing on right now?</strong>
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<p><br>In the past couple of years, ecommerce has faced supply chain delays, inflation, and price hikes. Consumer spending has slowed down as a result while acquisition costs are at an all-time high and continuing to rise, meaning that brands are spending more only to gain less when it comes to winning new shoppers.<br><br>While brands can’t neglect acquisition altogether, those that prioritise retention will be better positioned for sustainable growth and increased revenue through customer loyalty. Retaining existing customers is also more cost-effective than acquiring new ones and <a href="https://www.yotpo.com/the-retention-marketing-manual/the-challenges-brands-face-when-tackling-retention/" target="_blank" rel="noopener noreferrer">while repeat customers account for only 21% of customers</a>, they generate 44% of revenue and 46% of orders.<br><br>Loyal customers can also become brand advocates, helping to grow the brand’s customer base and offset steep acquisition costs. According to a <a href="https://kantar.turtl.co/story/media-and-me-delivering-better-advertising-uk-social-web-promotion/page/2/1" target="_blank" rel="noopener noreferrer">Kantar survey</a>, 93% of consumers trust recommendations from friends or family over brand advertising, so investing in loyalty pays off.</p>
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<h2><strong>What’s an effective way to increase customer lifetime value that you think more brands should be embracing?</strong></h2>
<p><br>Loyalty and referral programs are the MVPs of customer retention and CLTV — and brands that approach their rewards structure strategically can see huge returns. Tailoring your loyalty program to motivate new and existing customers to return is key to increasing your customer lifetime value.<br><br>Using a tier-based approach within your rewards program is a great way to gamify loyalty - the better the perks are at the top, the more incentive members have to spend more and level up.<br><br>Segmenting your loyalty members is key to maximising engagement with your program. Awarding points for reaching a certain number of purchases is a great strategy for first-time buyers, while awarding points for spending a set amount helps drive higher spend from your more frequent shoppers. Tailoring your marketing to those segments is essential and SMS marketing, with a 98% open-rate, increases the likelihood of customers taking the actions you want.</p>
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<br><br><strong>Every brand dreams of becoming a cult favourite. What can they do to help turn existing customers into loyal advocates?</strong>
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<p> <img src="https://cdn.shopify.com/s/files/1/1472/1782/files/EI_Yotpo_Square_2_1024x1024.png?v=1687173726" alt=""></p>
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<p>Brands need to get to know their customers on a deeper level if they want to foster relationships that build genuine loyalty and brand advocacy. That means having solutions in place that give a holistic view into customer data. The more connected your tech stack, the easier it is to get that 360-degree view into your customers.<br><br>A great example of a brand that leverages their loyalty program effectively is hair care brand <a href="https://www.yotpo.com/case-studies/moroccanoil/" target="_blank" rel="noopener noreferrer">Moroccanoil.</a> They put a lot of thought into the perks that would provide the most value to their members and the customer behaviours they want to incentivise. As well as rewarding customers for purchasing activities onsite, loyalty members can cash in their points for either discounts or free products. They also reward customers for referring friends and family. By directly incentivising advocacy through their loyalty program, Moroccanoil are acquiring new customers at a much lower cost than they would on other channels.</p>
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<br><strong>About #EcomInsights</strong>
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<p>#EcomInsights is a series from <a href="https://www.underwaterpistol.com/" target="_blank" rel="noopener noreferrer">Underwaterpistol</a> where we speak to the industry’s best-known tech tools and platforms about how ecommerce brands can tackle challenges facing the industry.<br><br><a href="https://www.linkedin.com/company/underwaterpistol" target="_blank" rel="noopener noreferrer">Follow along</a> for insights from the experts on how to drive the growth of your business and overcome problems that come up along the way.</p>

#EcomInsights: How to maximise customer lifetime value