6 Customer Retention Strategies for Amazon - US

What’s Covered!

Expert Advice: 6 Customer Retention Strategies for Amazon - Tips by Kiran Patil (CEO & Co-founder, Growisto)

Session of the Week: Measuring Incrementality on Amazon - By Jeremy Dodge (Strategic Advisor & Consultant, Growisto)

Tip of the week: ​​How to cut costs and improve your margins on Amazon?

Case Study: How did Growisto help Monsoon Harvest increase their sales by 5x?

Expert Advice

6 Customer Retention Strategies for Amazon

Brands often struggle to get repeat business from customers on marketplaces such as Amazon. While, it is true that marketplaces normally do not lead to repeat purchases as much as a website or app would. But, there are a few things that you can do to retain and re-engage customers on marketplaces like Amazon as well.

In this week’s newsletter, we will deep-dive into some of the best retention strategies that can be implemented on Amazon:

1. Amazon’s Subscribe and Save: Making it easy and worthwhile for customers to be loyal to your product is one of the best ways to improve customer retention. Amazon's Subscribe and Save program is an excellent way to do so. This feature allows Amazon customers to sign up for regular deliveries of products that they use frequently, for example, groceries, baby products, beauty, health, personal care, pet products, and sports equipment. By subscribing to this, customers can avail a 5-15% discount or free delivery on these orders. With Amazon’s Subscribe & Save, you get consistent sales as customers have committed to receiving orders from you on a recurring basis.

2. Sponsored Display Ads: These ads are an Amazon remarketing product that permits you to show your ad to customers who have previously viewed your items or similar products, searched for terms related to your product, or purchased from you. 

Amazon Sponsored Display provides a way for you to re-engage and retarget consumers to your listing through auto-generated, product-focused ads on Amazon as well as third-party websites. 

According to a report, only 4% of consumers convert to purchase instantly. With views remarketing, Sponsored Display ads enable you to re-engage the remaining 96% of the audience. It is beneficial for all advertisers who sell on the marketplace and are registered with Amazon Brand Registry. It helps those sellers by strategically placing ads on the Amazon home page, shopping result pages, product detail pages, third-party websites, and apps.

3. Amazon Demand-Side-Platform: Amazon DSP helps re-target users that have already interacted with your product page, brand page, or anything related to your company on Amazon. You can programmatically buy display, video, dynamic, and other types of ads to re-engage audiences, both inside and outside of Amazon. The Amazon DSP retargeting capabilities can help you:

• Cross-sell complementary products to customers

• Increase brand awareness by re-engaging previous visitors who have interacted with your brand

• Inform previous site visitors or customers about the latest products they may be interested in

• Remind previous customers about repurchasing your product

4. Emails and Product Inserts: Sending follow-up emails to thank your customers and offer them a special discount coupon for their next purchase is one surefire way to boost your repeat purchases. You can even highlight other products from your portfolio and suggest related products that can be beneficial for the customers. 

Another way to encourage repeat purchases is by including product inserts in the packaging of your products. You can add a “thank you” note in the packaging along with a discount coupon for their next purchase.

5. Providing Accurate Information: Customers must trust you in order to return to your brand. The best way to do this is by providing them with accurate information about your products and brand. Create an outstanding storefront or listing with A+ content and product photos. Make sure that your listings actively speak to the audience that is buying from you. Ensure that your listings are all up-to-date and accurate. Moreover, any other details about your brand or policies should be clearly listed out.

6. Customer Service:  Providing high-quality customer service means you need to pay attention to any customer service issues that crop up. To the extent that Amazon allows you to do so, make sure that customers know how to get in touch with your brand in case of any issue. Create a robust list of FAQs, provide troubleshooting information, and – above all – respond to any messages actively. It is also advised to show receptiveness to any feedback that you get and give your customers a superior product/service.

All in all, an effective retention strategy can help you re-target your customers, create repeat sales, and thereby increase LTV of a customer  on a marketplace such as Amazon.

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Session of the Week

Measuring Incrementality on Amazon

How can Amazon vendors and sellers ensure their media spending drives incremental sales rather than targeting shoppers who would have purchased anyway?

Jeremy Dodge, Strategic Advisor & Consultant at Growisto, will be presenting insights into this topic at the Prosper Show happening at Mandalay Bay, Las Vegas, on 5 March from 2:00 PM to 2:50 PM PST.

He will review some of the approaches to calculating iROAS in the industry today, and why none of them actually achieve a perfect KPI to follow. Join this session to explore the history of ROAS and the new approaches to iROAS (incremental return on ad spend).

Learning Objectives:

• Understand why ROAS should not be your main KPI.

• Learn how different people calculate iROAS.

• Develop a bespoke strategy for determining incrementality for your products.

Tip of the week

How to cut costs and improve your margins on Amazon?

Over a hundred brands must have told us that after revenue growth and visibility boost, improving margins is the next focus area for them.

So what are the different ways that can help you cut costs and improve your margins on Amazon?

1) Optimize Product Packaging - Size and weight of the product’s packaging can add to your FBA/shipping fees. Hence, you must optimize your packaging to fit the smallest tier possible.

2) Add the right product dimensions - Ensure that Amazon has recorded the right product dimensions in the system. If the dimensions are not right, you are owed a refund.

3) Sell items in bundles - Analyze historical data and consider bundling products that are usually bought together, or items that can be clubbed into packs of 2, 4 and so on.

4) Choose your product categories wisely - Make sure that your product is highly relevant to the category that is chosen, as they decide the Amazon referral fee you must pay.

5) Take stock of stranded and unfulfillable inventory - Regularly monitor your stranded and unfulfillable inventory to avoid paying extra for them.

6) Product Pricing - FBA fees and transaction fees vary with the product price, therefore, always check these fees applicable to your products for different price points.

7) Product Mix - Finally, choose the right product mix that will give you the highest margins.

These tips might be effort-intensive to implement and measure, but with the right partner, you can adapt and conserve costs in an ever-changing eCommerce market.

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Case Study

How did Growisto help Monsoon Harvest increase their sales by 5x?

Monsoon Harvest is a brand deeply committed to offering healthy, wholesome, and sustainable foods. We partnered with them to elevate their market presence and sales.

Our Objective:

• Build a comprehensive plan for increasing sales

• Launch products in five new categories

Our Strategy:

Results:

• 5x Increase in Sales from PPC with a consistent ACoS Range

• 700% increase in revenue within a year

• 12% Monthly Growth Rate Average Sales Growth Rate for 12 months

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