True customer acquisition doesn't end after the first purchase.
The first purchase is a necessary step, but the second purchase is really the key to driving long-term value for your company. On average, only 20% of first-time online buyers will ever make a second purchase. Unfortunately, that means you spend a ton of time and effort to acquire buyers who may never engage with your brand again.
That fact should both frustrate you and challenge you as a B2C marketer. The good news is that if you manage to drive a second purchase, your customer is more than twice as likely to buy a third time, and even more likely to buy a fourth time. First, though, you have to get past the hurdle of the second purchase.
Turning one-time buyers into loyal customers is not an easy task. There's a reason so many customers drop off after the first purchase—and it's your job as a marketer to discover that reason and overcome it. You may be able to offer up a coupon, a promotion for a similar product, or even a well-timed reminder to convince a few more customers to buy again.
If you're able to make even a small increase in your conversion rate for second-time purchases, you'll see serious revenue growth. In fact, if you can keep just 10% more of your existing customers, you will easily double your revenue.
So it may well be time to shift some of your marketing focus from finding and engaging new customers to nurturing and convincing your existing customers. Here's how.
Reassess your marketing spend
Like most savvy e-commerce brands, you're probably spending a decent amount on Facebook ads, retargeting, and email marketing to acquire new customers. You're not alone: Most online retailers invest nearly 80% of their digital marketing budgets on new-customer acquisition, specifically. However, it costs five times more to acquire a new customer than it does to keep your current customers, according to Forrester Research.
That means your marketing budget is probably a bit out of whack. B2C marketers should spend more of their resources turning existing customers into repeat buyers rather than focusing so much on acquiring those new customers.
Your existing customers already know your brand and like what you're selling. All you have to do is convince them to pull the trigger on that second purchase. It makes sense purely in terms of ROI to invest more in the second purchase.
Identify first-time buyers
Now that you've decided to focus on convincing one-time buyers to make their next purchase, how do you do it effectively? There are many tactics to try, but first you have to segment that group of buyers specifically. Without a targeted list of customers who have bought from your company just one time, there's no way to market specifically to them.
The challenge is to make sure each customer has really made only one purchase. It sounds simple, but it can get a bit complex because of the nature of today's retail market.
Many of your buyers will interact with your brand in multiple ways—in-person at stores, online, on social media, and more. You need to be certain that you know exactly who bought what and when. To do that, you must unify the identify of your in-person and online shopper into one.
With the right data, you can then make sure you're sending a second purchase campaign only to customers who have bought once.
Create targeted campaigns
With a reliable segment of one-time buyers, you can then create marketing campaigns specifically pushing those target customers to make the next purchase.
Depending on your average buying cycle, create a second campaign tailored to engage that customer after a few weeks or a month—whichever you judge best to push for the next purchase. You should also carefully test the success rate of each campaign, optimizing the timing of each email send or ad retargeting.
The key to an effective second purchase campaign is, always, relevance and personalization. If a customer first buys a women's jacket and you then offer a discount on men's shoes, it may not convert at all. So think about what exactly that customer may want or need, and offer it to them in an appealing way.
Some of the classic examples of a second purchase campaign are a discount, a related product offer, or a flash sale. You should try a few tactics to see which work best for your customers.
With the right targeted and personalized marketing to one-time buyers, you'll ideally see more and more make a second purchase. Once you've gotten them to take the leap a second time, it's only a matter of time before they buy again.
Zaius combines a single customer view with real-time, cross-channel marketing and attribution, empowering marketers to drive more repeat purchases and maximize customer lifetime revenue. It's the first CRM built specifically for B2C marketers. To see how other top marketers drive repeat purchases and increase customer lifetime revenue, check out our latest podcast series, The Empowered Marketer.