MarketingSherpa has released a report of ecommerce benchmarks. You can view a summary of their findings in a free PDF.
Overall the data is informative but what really peaked my interest was their research on measuring customer retention and loyalty:
Despite the fact that everyone in this business knows that returning customers are the key to profitability, fewer than 50% of merchants we surveyed said they track loyalty, lifetime value, or retention costs.
Mass merchants, who were more likely to be multichannel marketers, were the least likely to track these ROI indicators. Given the amount many have invested in offline loyalty campaigns, clubs, and cards for their brick and mortar experience, this is a disheartening trend online.
Measure Up
Why would you throw money into a black hole without knowing the return on investment? This indeed seems very foolish to me. If you track your customers and measure results, you can actually see what is working and fix what doesn’t!
Visibility
Loyal return customers should be your favorite source of business. They will often stick with you through thick and thin. Do you know how many repeat customers you have in your business? Get some visibility into this segment to see how effective your business machine really is.
Changes
Only when you have real data in hand, can you make accurate decisions that aren’t based on conjecture or pure opinion. If your returning customer numbers are a small percentage of the whole, why aren’t people coming back? You need to solicit feedback and fix the problems.
Start Today
So pay attention, measure results, and tweak things until they produce what your business needs: more loyal, return customers.
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Ellen Weber
April 28, 2006
I liked your notion of relating to the customer through feedback. How many times I’d love to be asked: “How do you enjoy or benefit from our telephone systems?” Wow — that would bring a hot survey result to most big businesses and a few smaller ones who seem to have lost the sense of people lately…. What do you think?
Joe Rawlinson
April 28, 2006
Ellen-
I agree. Many times we as consumers would love to give companies feedback. Unfortunately, there often isn’t a medium to do this or feedback is never solicited. Businesses could learn a lot if they just asked!