E-Commerce: The Importance of Customer Loyalty

While the acquisition of new customers to e-commerce websites is of course crucial, it is equally crucial to make sure that those customers remain loyal to your brand. In this edition of the Brickweb blog, we'll be looking in more detail at how customer loyalty can be the difference between success and failure in the ultra-competitive online arena and illustrating the point with data and statistics from Smile, the industry-leading loyalty app.

The average cost of acquiring new customers continues to rise. In 2013, the figure stood at just under £7 but has skyrocketed by a massive 222% to over £22 at the end of 2022. This has highlighted the growing importance of retaining existing customers.

Based on samples of 250,000 e-commerce brands and more than a billion online shoppers around the world, Smile has calculated that an average of 41% of the revenue of e-commerce websites is created by just 8% of its customers, with 35% generated by the top 5% of customers. 

The data also revealed that, as the amount of purchases by a customer increases, the likelihood of them making a further purchase increases corres­pon­dingly. After a single purchase in which the customer has had a good experience throughout, there is an average 27% chance that the customer will return to the e-commerce store to make a second purchase. If they do make a second purchase, the chance that they will return again rises to 49% and then, after this second purchase, the chance that they will return once more jumps up to a massive 62%.

In addition to converting more often, repeat customers also boast a higher value order on average than a first-time buyer. The data from Smile shows that the top 10% of customers spend twice as much per order on average than the remaining 90%. The top 1% of buyers spend 2.5 times more on average. 

Repeat customers are far more likely to leave good reviews and create other types of user-generated content (UGC), which was ranked by Smile as the most trustworthy type of content. A study by Annex Cloud Research revealed that e-commerce websites that incorporated UGC saw a revenue increase of 18%.

E-commerce websites designed and created by Brick technology, a leading e-commerce development agency, provide users with a secure, seamless and modern experience, which is a key way to ensure customer loyalty. In addition, our standard-setting suite of internet marketing services ensure that you can reliably and cost-effectively acquire new customers. Find out more on our website and get in touch to start your journey!

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