Although retailers often play to their most loyal consumers, it may be wiser to engage those that are keeping up with the conversation but just haven’t purchased from them yet.
One report from e-commerce marketing platform provider Bluecore suggests that “lost” and “at-risk” buyers present a massive opportunity for retailers to drive revenue beyond what they get from their most active buyers.
“Lost” buyers are defined by the report as those who have a high probability of never purchasing from a retailer again, while “at-risk” buyers have deviated from their typical shopping cycle and might abandon the seller for good.
When monitoring email open rates based on the shopper’s current life cycle stage, active buyers have the highest open rate across average order values (AOV), but at-risk buyers and lost customers are not far behind.
For example, active buyers have a 9.52 percent open rate when their AOV is between $0 and $99, while at-risk buyers have a 7.19 percent open rate and lost customers have a 6.42 percent open rate. And for those with an AOV between $100 and $249, active buyers see a 12.41 percent open rate, while at-risk buyers have a 9.95 percent open rate and lost customers have a 9.57 percent open rate.
So while active buyers open at higher rates in both instances, the fall-off relative to other shoppers isn’t drastic. And it suggests that some consumers are still paying attention even if they’re not buying. With that in mind, Bluecore recommends brands to treat at-risk and lost shoppers with care and curate each campaign to convert them into active buyers.
At a 0.12 percent conversion rate, at-risk shoppers are converting and clicking (1.96 percent) at a rate that is comparable with active shoppers’ conversion (0.11 percent) and click rates (2.06 percent). This could represent a major opportunity for brands to recognize shoppers before they’re lost with the right messaging to bring them back to active profiles.
To arrive at this year’s benchmarks, Bluecore analyzed more than 35.5 billion campaigns across global retail brands’ emails and e-commerce sites, as well as the resulting actions taken by shoppers.
Apparel and footwear are two of the most successful categories in retail as far as generating repeat purchases out of first-time customers. While health and beauty led the way with 8.52 percent of one-time buyers making a repeat purchase, apparel holds down second place at 7.33 percent followed by footwear at 6.87 percent.
The report highlighted larger footwear brands going direct-to-consumer this year as catalysts for this number, as they are investing in experiences designed to keep shoppers returning.
Even though the greater percentage of a brand’s total shoppers in the report are one-time buyers, retailers converted more one-time buyers to a repeat purchase than they converted non buyers to a first purchase.
Inflation heavily curbs spending
Another recent survey from e-commerce fraud protection platform Signifyd titled “The State of Commerce 2022” delved into the post-Covid purchasing habits of today’s shoppers.
The report found that 68 percent of 1,005 U.S. online consumers had cut back on spending in 2022 in the face of persistent inflation, while nearly that many (62 percent) said they would continue to rein in their purchases for the rest of the year.
“Retailers and brands need to stabilize their operating costs while optimizing their conversions and revenue given today’s economic challenges,” Signifyd CEO Raj Ramanand said in a statement. “Consumers are being cautious when it comes to spending and choosing whom to shop with. Providing a best-in-class customer experience has never been more important. This report, produced with the help of some of our key strategic partners, will help guide merchants as they complete their pivot from a pandemic footing to a new era of e-commerce.”
E-commerce sales have leveled off significantly from its skyrocketing acceleration during the pandemic. Across the merchants in Signifyd’s Commerce Network, e-commerce orders first increased 46 percent in 2020 before growth slowed to 33 percent in 2021. This year, e-commerce sales have declined by 3 percent. The company’s predictive models indicated that online sales will dip moderately in the third quarter, but will rebound again by 3 percent to 4 percent in the typically busy fourth quarter.
A slight majority of consumers say they haven’t contributed to that dip, with 55 percent of shoppers calling their Covid-driven online shopping habits permanent. Thirty-one percent say the changes are not permanent, while another 14 percent say they aren’t sure if their habits have stuck.
The report also focused on the changing dynamic that fulfillment and returns now bring to the retail table. Sixty-two percent of shoppers said they would buy more from a brand based on having a good returns experience, while 65 percent said poor experience on this front would scare them off altogether.
As for what constitutes a positive returns experience, 48 percent of shoppers call for an immediate refund in the process. Coming in right behind are the 47 percent of shoppers who want a return label provided, and 45 percent who say the returns experience should come with no additional restocking fees. Other factors that make a positive returns process include free return shipping (43 percent) and long return windows (43 percent).
When it comes to the fulfillment options that gained wider implementation throughout the pandemic, 41 percent of shoppers say they were more likely to use buy online, pick up in store (BOPIS) after the pandemic, while 31 gave curbside pickup their vote.
Signifyd data shows sales from pickup orders are up 176 percent in the past 12 months compared to the previous full year. In May, the most recent month highlighted, sales from pickup orders jumped 143 percent year over year, representing 5.7 percent of all orders.
“All of this is always to live up to Amazon,” said Ben Barenholtz, vice president of marketing for Quivers, which provides technology that allows brands to offer BOPIS and curbside pickup through retail partners. “When you say, ‘Well why are we doing this?’ All of this matters. It’s the consumer expectation.”