Repeat Purchase Rate (RPR) is a significant metric to evaluate the long-term performance of a business. While the average success ratio of selling a product to a new customer is just 5%, the average success ratio of selling a product to an existing customer is between 60-70%. Therefore, keeping the existing loyal customers is necessary as they contribute the lion’s share to the profit, and entrepreneurs should focus and modify the strategies to persuade their customers to return.
What is Repeat Purchase Rate?
The repeat purchase rate is the percentage of customers who buy products more than once from your business. It’s an important metric to calculate customer retention. Repeat customers not only generate more revenue but also serve as valuable leads by referring your company to others. As the e-commerce world becomes more competitive achieving a high repeat purchase rate is more challenging. Ensuring quality is the first and foremost factor to maintain a high repeat purchase rate. additionally, implementing some other strategies can help you attain a high RPR and take your business to the next level.
Importance of Tracking Repeat Purchase Rate
The repeat purchase rate may vary according to the industry or products. For example, some durable products, including electricals and home appliances that are bought infrequently, have lower RPRs. RPR gauges client loyalty, as returning customers tend to spend more money and are likely to make future repeat purchases. Research shows that 27% of total customers who made their first purchase are likely to make a second purchase. Additionally, 45% of second-time shoppers are likely to make a third-time purchase. These findings suggest that building a long-term customer relationship boosts business growth.
Tracking PRP helps to recognize potential issues as early as possible. A low PRP rate indicates issues with product, service, or customer experience. So, tracking PRP is an important metric to identify underlying issues also. A satisfied customer is likely to recommend your brand to others, and word-of-mouth marketing is an unpaid promotion that benefits the company abundantly.
What are the E-commerce Strategies to Increase Repeat Purchase Rate?
As the PRP rate is one of the influencing factors that affect business growth, let’s delve into effective strategies that an e-commerce brand can employ to increase this metric.
Customize the Shopping Experience
Customization/Personalization plays a significant role in customer retention. By analyzing customers’ personal data and shopping history, a company can set up customized offers, discounts, and product recommendations, and can execute other marketing campaigns. Creating a sense of value for customers fosters their interest and encourages repeat purchases.
Make a Post-Purchase Communication
After the product is delivered, it is important to keep constant communication with customers to sustain their interest. Sending thank you messages and alerts on new arrivals and discounts encourages the customers to visit your site frequently which ultimately leads to increased shopping activity.
Deliver the Best Customer Service
Delivering exceptional customer service plays a pivotal role in boosting RPR. Brands that prioritize excellent customer service cultivate a positive customer experience, leading to heightened customer loyalty and repeat purchase rates. Ensuring transparent return policies, expedited shipping options, and outstanding customer support are essential elements for achieving this goal.
Make a Sense of Urgency
Making a sense of urgency in customers persuades them to make their purchases immediately. Strategies such as limited-period offers, exclusive deals, and scarcity tactics instill a feeling of seizing the opportunity in customers.
Provide a Subscription Service
Implementing a subscription model presents a valuable opportunity to boost recurring revenue by converting one-time customers into loyal subscribers. Studies indicate that 50% of subscribers maintain multiple active subscriptions. The appeal of this high rate can be attributed to the seamless purchase process. With a subscription, customers avoid the need to go through the checkout process for each purchase. By providing a smooth and hassle-free experience, you enhance the likelihood of customers completing purchases and returning for future transactions more frequently.
In conclusion, implementing effective eCommerce strategies to increase high RPR (Repeat Purchase Rate) is essential for fostering customer loyalty, driving revenue growth, and ensuring long-term success in the competitive online marketplace. By customizing offers, personalized recommendations, and maintaining constant communication with customers, brands can create a sense of value and urgency, encouraging repeat purchases. Additionally, establishing loyalty programs, offering exclusive deals, and providing exceptional customer service further solidify the bond with customers, making them more likely to return and make repeated purchases.