How Amazon Plans its Customer Retention Strategy?

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Posted On: 22 Mar, 2021
Last Updated On: 21 Apr, 2021

Amazon is the most visited e-commerce platform. Sellers use this platform on a large scale to reach out to customers.

Since its inception, Amazon has been making efforts to retain its old customers with various plans and offers.

According to Beamer, the e-commerce giant handles around 90 per cent of Customer Retention. It works towards building an individual sellers’ brand with its image. 

Amazon has an excellent, loyal customer base due to its quality of products, fast delivery system, and hassle-free product return process. 

It has intentionally kept its customers’ facility in mind. Amazon uses various ways to retain its existing customers. 

This article will help you to discover how you can use these methods in your e-commerce sites to hold on to your consumers.

How Amazon Retains Existing Customers And Acquires New Ones

For any successful e-commerce website, a loyal customer base is a must. Even though there are hundreds of tactics to build a new customer base, it takes a lot of effort and a considerable budget to reach out.
The most significant advantage of a customer retention strategy is that one doesn’t have to introduce their product to customers.
We need to provide more facilities, be more flexible with our services, and transform ourselves according to the ever-changing needs of existing consumers.

It is always essential to follow what the customers need and observe their shopping patterns through analytics and reports.
If your e-commerce website lacks the facilities, and cannot analyze existing customers’ shopping behavior, then the customer retention strategies will seldom work. One has to focus on the overall experience of the customers.

The Customer Retention Strategies That Amazon Uses

The Customer retention strategies that Amazon uses are:

  • Understand your target audience – The best example would be, suppose a large section of your audience stays in a colder region. You can display apparel best suited for winters.
  • The Analytics reports of navigating and shopping patterns of users of a specific area will help you (sellers) to ascertain which products to put on display on the online portal.
  • Suppose most customers from a specific location buy books rather than other items; then Amazon will mostly show books on their product listing page in that particular area. Amazon uses this strategy to understand its customers.
  • Personalize consumers’ experience – Amazon makes it a point to personalize consumers’ experience by providing them products according to their previous buying behavior.
  • It is a significant step that helps Amazon to convert potential users and retain the existing ones. Amazon provides offers and discounts according to consumers’ buying patterns. 
  • Therefore, it is crucial to understand your customers. Tools like Monetate can help to suggest items to consumers as per their needs. It provides a personalized experience to users.
  • Understanding FOMO – FOMO stands for Fear of Missing Out. It is a psychological marketing strategy to grab consumers’ attention. 
  • The process makes a product appear exclusive and tempting enough so that consumers feel an immense need to buy the product.
  • On special days, festivals, Amazon uses this technique to grab customers’ attention.
  • Prime day sales, exclusive offers, limited offers for prime members, Festive offers, and so on are strategies implied to stimulate customers’ minds, so they get fear about losing the opportunity of buying an exclusive product on a good deal. You can use this strategy for your e-commerce website.
  • Maintaining relation with potential users– At first, many visitors usually visit the e-commerce website to get answers about a product. A visitor tries to find the price, quality and availability, and other specifications related to the item.
  • And in such cases, there is a seldom chance that they would buy any item. 
  • Therefore, communicating with such visitors once a while by emails, telling them about their searched products weekly or monthly, and informing them about new offers on the searched and related products may strengthen the bond.
  • Amazon is efficient at handling visitors. They keep communicating with the visitors once a while with a personalized email about the searched products.
  • You can also use this method by using a tool called OptinMonster that creates an exit popup that keeps a user’s record when they leave the site. It is always important to communicate with new visitors.

Acquisition strategy by Amazon

Amazon focuses on customers’ overall shopping experience, whether it’s the existing customers or the new ones. Some of the following acquisition and customer retention strategies we can learn from Amazon are:

  • Build a website that is easy to navigate and checkout without much hassle. An e-commerce platform should be user-friendly and updated.
  • In case a developer adds new features to the website, make sure they are not too complicated for the users, or it will ultimately affect the user base.
  • Users must find the available items on the product lists, and checking out after buying the product or returning the product should not be much difficult to use.
  • Amazon’s website is user-friendly, and anyone can use it without much hassle. The website should easily track the product return.
  • Amazon keeps updating its customers about products by emails and registered phone numbers. These are some of the methods you must follow to retain your customers and make it suitable for new users.

Conclusion

Amazon provides a huge platform to online sellers, and it uses various techniques to retain its existing customers and convert new visitors.

The platform uses effective methods as a part of its customer retention strategy.

The following methods are: Understanding the target audience, Understanding FOMO, Personalize consumer experience, Maintaining relation with potential customers, Creating a hassle-free e-commerce platform are some of the crucial strategies which Amazon uses to hold on to their existing customers.

While designing an e-commerce platform, you must keep in mind that the website has to be user-friendly, and the integration of Google Analytics into your website is a must.

It helps to understand various levels of customers’ buying pattern, and also provide all-inclusive details about items on the website. 

This type of website architecture will help to retain existing customers and convert new users.

It is essential to communicate with new users who merely visit the first time to check items and not purposely buy them, with personalized emails weekly or monthly, and provide updates about the searched products.

Monetate – can help to suggest items to consumers as per their needs. 

It provides a personalized experience to users. OptinMonster creates an exit popup that keeps a user’s record when they leave the site. It is always important to communicate with new visitors.

An efficient CRO team can guide the sellers to build a customized site with all the qualities mentioned above to retain existing customers and acquire new ones.

To know more about the CRO and Google Analytics,

Click here for more information! 

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