Omniconvert eCommerce customer retention survey

1Omniconvert / 22 Oct 2018 / Survey conducted at Magento Live Europe 2018 (9-10 Oct 2018)
eCommerce
Customer
Retention Survey

“Eighty percent of CEOs believe they deliver superior
customer experience.
Only 8 percent of their customers agreed.”
Bain & Company survey
Source: https://www.cmswire.com/customer-experience/80-of-ceos-couldnt-be-wrong-could-they/

What to expect from this presentation
Omniconvert / 22 Oct 2018 / Survey conducted at Magento Live Europe 2018 (9-10 Oct 2018)
While attending Magento Live Europe 2018 in Barcelona, I took
the opportunity to address a couple of questions to the event
participants.
Objective: Understand their take on customer retention and
customer-centricity
This is what came out of that short onsite survey

51
eCommerce
respondents took
the Retention
survey onsite @
Magento Live
eCommerce Manager, 34%
Developer, 24%
C-Level (CEO, CMO, CTO), 16%
Product, 12%
Other (Data, Solution), 14%

52%
of the respondents
come from Home &
Deco, Fashion and
Electronics
industries

65%
of all respondents
report high to
brutal competition
in their industries
We live in highly competitive times
Brutal, 27%
High, 37%
Quite, 22%
So and so, 14%
Shark pictogram created by Bakunetsu Kaito from the Noun Project

Participants reported these industries as being highly
competitive
Electronics
5 out of 6 participants
reported High and Brutal
competition in their markets
Fashion
Home & Deco
Sport apparel
Question asked: “How competitive is your market?”

With brutal competition and
limited markets, businesses
need to pivot towards retaining
customers for their growth

“Growth is not a question of
acquisition, but one of
retention”
Anita Andrews, Director - Analytics Practice, Magento Services

Only 28% of the eCommerce
companies reported that they
have someone responsible for
customer retention.

Q: Do you have a budget allocated for customer retention?
63%
reported not having a
budget allocated to
customer retention.

12
Omniconvert / 22 Oct 2018 / Survey conducted at Magento Live Europe 2018 (9-10 Oct 2018)
Q: Do you have someone responsible for retention?
72%
reported not having
a dedicated team or
individual focusing
on customer
retention.

Q: Correlation between revenue size and respondents answering YES to
having a dedicated person for customer retention
– The bigger the revenue the higher
the chances for that company to
have someone responsible for
customer retention;
– Companies with >100M euro
revenue are the only ones that
reported having a special
department created for customer
retention
When correlating revenue size with customer retention focus

Low focus on retention is also seen in the KPIs monitored
Q: “What KPIs are you currently monitoring?”– There is still a big focus on sales-
driven KPIs (i.e. AOV and CAC)
– While Customer-centric KPIs (i.e.
Customer Retention and NPS) still
fall behind on the agenda.
– Only 25% participants report
measuring Customer retention Cost
→ only few participants are aware of
retention benefits.

“acquiring a new customer is anywhere from five to
25 times more expensive than retaining an existing
one.
[...] increasing customer retention rates by 5%
increases profits by 25% to 95%.”
Extract from Harvard Business Review article - The value of keeping the right customers
Source: https://hbr.org/2014/10/the-value-of-keeping-the-right-customers

RFM Segmentation in Customer Retention
Monetary
What’s the monetary value of all the orders
placed by a customer in his lifetime relationship
with your store
– RFM helps Marketers segment their
database into customer groups of different
values (i.e VIP, Active, Dormant, Lost)
– Through RFM Segmentation, online stores
can create personalized web / emailing
campaigns offering their customers
relevant experiences
– It also surfaces the most important
customer segment to consider
Frequency
How many orders
has a customer
placed in all his
lifetime relationship
with your store?
Recency
How recent did a
customer place an
order with your
store?

When asked about RFM Segmentation usage
Only 24%
reported using RFM on their
customer database.
This may indicate that creating
personalized experiences for
customers is still a new process.
Most of the participants who
mentioned YES, correlate RFM
with email marketing.
Q: “Are you using RFM Segmentation?”

That’s it from my side
In conclusion I would like to
leave you with this

Growth is not an accident.
It’s the natural consequence
of retention.

Valentin Radu
www.omniconvert.com/growth-engine
https://uk.linkedin.com/in/valentinradu
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questions?

Omniconvert eCommerce customer retention survey

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