How to build lasting relationships & increase LTV in ecommerce

It’s no secret that customer lifetime value (LTV) is one of the key metrics for ecommerce success. In 2022, Recharge subscription merchants saw a 12% increase in LTV from the year before—a huge gain, especially in the face of rising customer acquisition costs. LTV can mean the difference between your business sinking or floating, as loyal customers are much more valuable than any one-time purchaser. 

88% of consumers say it takes three or more purchases to build brand loyalty, meaning ecommerce stores have to find ways to engage customers and keep them returning, in order to build a strong relationship that will lead to higher LTV. 

In this blog, we’ll cover how merchants can cultivate long-lasting relationships that will help them increase customer lifetime value, while boosting customer satisfaction and providing a great customer experience.

What is customer relationship management?

Customer relationship management (CRM) is a process that businesses use to monitor and manage their interactions with existing customers and potential customers. 

CRM is hugely important when it comes to creating a strategy to boost LTV—your brand has to know how and why customers choose to stay with your brand. Their lifetime value depends on their relationship with your store and how you cater to their needs. 

When customers are treated well, loyalty increases and they feel comfortable and confident to make repeat purchases. Analyzing how customers interact through CRM and other customer data allows brands to personalize their interactions with shoppers and anticipate their needs—leading to higher brand trust and loyalty and better customer retention. 

3 strategies to strengthen customer relationships & increase customer lifetime value

Working to increase LTV means developing strategies to strengthen customer relationships and increase the average customer lifespan. When a shopper comes back, again and again, to shop with your brand, their customer lifetime value increases with each purchase. 

To create these valuable customers that keep returning, merchants can follow the strategies listed below to make the customer experience memorable and keep customer satisfaction high. 

1. Leverage customer feedback & reviews

If you want to give your customers what they want, so they keep returning and the average customer lifetime value goes up, then you have to listen to what shoppers are saying about your store. 

Leveraging customer feedback and reviews means that your brand can constantly improve the customer journey and offer top-notch customer service to your customers. Include post-purchase surveys and other opportunities for customers to offer feedback. Merchants can also incentivize customers to leave reviews for products they’ve purchased by offering discounts or rewards for doing so.

These follow-ups after purchase can help your business improve product development and hone your marketing efforts to fit your target market. Plus, positive reviews and proof from real customers can be used to build trust and increase credibility, which will in turn help boost LTV.

2. Consider loyalty & referral programs for loyal customers

An unpaid loyalty program or paid membership program is another avenue for brands to consider if they’d like to put effort into building long-term relationships with customers. Offering exclusive offers through these types of loyalty programs can entice shoppers to return to your store and continually make purchases in order to access new rewards. 

Referral programs are another valuable way to leverage your existing customers to help you gain new customers who are more likely to stick with your brand over time. With a formal referral program, you give shoppers the chance to share their positive experiences with your brand with their friends and family, therefore growing your reach. 

Referred customers will already have a higher level of trust from the get-go, thanks to the more personal way they heard about your brand.

3. Provide value-added content, resources & education to customers

Brands that are looking to improve customer lifetime value can also focus on providing customers with quality content and resources. These days, customers want more than just a product—they’re interested in a relationship with your brand that goes beyond. 

In order to retain customers and earn repeat business, merchants should focus on their content strategy to provide that all-encompassing experience customers are looking for. A few examples of value-adding content that businesses can offer their customers, to complement their product offerings, are:

• A blog with educational articles related to your mission
• A podcast interviewing notable members of your industry
• A free email newsletter with recipes, tips, or other information related to your business

Providing quality content like the ones listed above will encourage customers to become more engaged with your brand, and hopefully, continue making purchases to increase their customer lifetime value. With data and feedback, your team can hone the content you’re creating to get the best results with your audience.

Beat rising customer acquisition cost by cultivating higher loyalty

As the cost to acquire every new single customer continues to rise, merchants have to put the focus on their existing customers. By utilizing customer feedback, creating valuable loyalty initiatives, and offering value-adding content, merchants can ensure they build a relationship with their customers that will keep them coming back. 

See how much value your existing customers are as you cultivate higher customer loyalty by building relationships with them, and watch customer lifetime value increase at the same time.