October 23, 2024
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Can the Online Post-Purchase Experience Build Loyalty?
A new survey finds online shoppers are more likely to make repeat purchases from brands that provide a “premium post-purchase experience” that extends well beyond fast and free shipping.
The survey of 1,000 U.S. online shoppers from 3PL provider Outerspace found consumers expecting the following post-purchase experiences when buying directly from a “premium” brand:
- A high-touch unboxing experience: With third-party marketplaces shipping every product in the same manner, 57% expect a “more memorable and personalized unboxing experience, such as a handwritten note or high-quality branded packaging.” Among generations, Gen Z and millennials are 11% more likely to expect it, while their Boomer counterparts are 25% less likely to expect the same.
- Ease of returns: Nearly all respondents (93%) agree that an easy returns process is a key factor when purchasing directly from brands. Additionally, over half (57%) say straightforward returns make them more likely to become repeat customers, and 59% believe the option of free return shipping significantly influences whether they’ll buy from a premium brand.
- Freebies: Over half of shoppers (57%) are more likely to repurchase from a brand when they receive gifts and free samples. Women are 16% more likely than men to repurchase from brands that offer free gifts with orders.
- Environmentally friendly packaging: Nearly one in three (31%) say easily recyclable and premium packaging motivates them to shop with a brand again.
Kate Terry, chief commercial officer at Outerspace, said, “The post-purchase experience is an often overlooked and underutilized channel for building loyalty, but as this report shows, consumers are ripe for forging loyalty beyond the cart — and beyond free or expedited shipping.”
Reverse logistics firm Narvar highlighted the value of communication in the post-purchase experience. Its survey found that 83% of customers expect consistent updates on their orders, with 34% preferring these updates through channels other than email, such as text messaging. Narvar noted that some of the communication is desired to thwart “porch pirates.”
Narvar also emphasized the importance of eco-friendly practices — such as minimizing excessive packaging — and providing various return options. A survey cited by the company showed that 65% of shoppers appreciate “keep the item” policies for low-value returns, as these save both shipping costs for retailers and time and effort for customers.
Finally, Narvar detailed the value of customer service agents in handling “Where is my order?” (WISMO) and “Where is my return?” (WISMR) customer frustrations as well as opportunities for follow-up messaging.
“Follow-up targeting isn’t a random money-grab,” Narvar reported. “Retailers can use the information they’ve gathered from past orders or site cookies to make suggestions about other items the customer might like, or remind the customer when their supply of an exhaustible item might need to be replenished.”
In a recent blog entry, Radial highlighted the need for a smooth payment process and the benefits of automation “to ensure that reward points are applied immediately and that customers are not retargeted by marketing for products they’ve already purchased.”
BrainTrust
Chuck Ehredt
CEO, Currency Alliance
Neil Saunders
Managing Director, GlobalData
John Hennessy
Retail and Brand Technology Tailor
Recent Discussions
Discussion Questions
Are retailers underestimating the potential of the post-purchase experience to drive loyalty?
Where are the biggest opportunities to reduce pain points or add value in the post-purchase phase?
Why is the post-purchase experience apparently discounted by retailers?
Poll
Loading …
Yes, a good post-purchase experience can build loyalty and stimulate repeat business. Ensuring all hygiene factors – delivery times, accuracy of order, etc. – are critical. However, going above and beyond with things like very nice packaging, a handwritten thank you note, some little freebies, discounts to use on future purchases, can all move the dial. I’ve seen a lot of independent online sellers who are great at these things. Good follow up communication is also important.
What people claim they do – or claim they will do – and what they actually end up doing have only the loosest of corelations. If all else is equal, will people choose one of the merit badge (eco friendly, cute packaging, etc.) winners? Sure; but let the price be 2% higher, and it’s suddenly “look…squirrel!”
A delightful post-purchase experience can transform a customer into an ardent repeat customer. More retailers need to think beyond the transaction and add even more value to the relationship so it lasts. Certain DTC brands grasp the power of pleasing us after the sale.
The post-purchase experience, especially for a first-time customer, can be the difference between a one-time purchase and a future repeat – even loyal – customer.
Ease of returns is the best post-purchase experience and most appreciated by most consumers. I believe second place goes to free goods, and high unboxing, a distant third. Frankly, I don’t believe that “environmental-friendly” works as well because most consumers are highly skeptical.
As we have said dozens of times, loyalty to a brand comes from the combination of good experience across all touchpoints and the overall perception of value (not necessarily a loyalty program). Therefore, post-purchase experience for online purchases is a key element – in large part because the customer did not have the opportunity to engage with the product of sales staff in a physical store environment.
Little details matter, but what is offered as extra value-added services depends on the positioning of the brand in the market and the nature of the product purchased. Brands should think deeply about these aspects to align their costs with the value bump in Customer Lifetime Value that can be created by showing a little more love.
In contrast to the differentiated touches noted, receiving a poorly packaged item with a hard to decipher guide, manual or instruction sheet, and a packet loaded with ads for irrelevant items is off putting. If you’re not making enough money on the sale, rethink your businesses processes. Don’t try to fill your profit gap with in-package or follow-on irrelevant advertising. And don’t cut costs on product use materials.
I would agree that a good number of retailers, across sizes and formats, are missing the opportunity to leverage a positive post-purchase experience into greater loyalty and repeat sales.
Some of the opportunities captured in the article, such as facilitating easy returns and product sampling, are very logical. However, dynamic personalization technology enables each purchase, both of product and of frequency, to apply an understanding of customer interests into a complementary purchase opportunity of related or similar products. In addition, the nature of consumable products inherently provides an opportunity to prompt a customer for a replenishment order or to subscribe to an auto order service that drives repeat purchases while helping a busy customer to stay in stock on regularly purchased items.
Suggesting complementary items, such as new flavors or variants of food and beverage items, complementary items to a recent technology, home decor, or apparel purchase are also logical opportunities as well.
In short, marketers will rightfully recite the cost of retaining and growing an existing customer relationship is always less than earning the business of a new customer. obviously, you should always be doing both, but without a doubt, the post-purchase experience is a great opportunity to earn the next purchase from an existing customer.
Every single interaction with consumers matters, especially the post-purchase experience. While execution at the store and digital platforms is fundamental for success, to help drive and ensure customer lifetime value, retailers have to be transparent and enable customers to control as much of the shopping experience as possible. Loyalty is a fragile thing, and it has evolved beyond just providing points and promotions.
Providing a seamless shopping experience and a frictionless returns process will enhance customer loyalty. Retailers can improve the overall customer experience by being completely transparent about their policies and offering the most convenient returns options.
Historically, retailers have always focused on mitigating product returns, considering them a challenge or issue. With total retail returns coming in at $743B in 2023 at an overall return rate of 14.5% and online return rates at 17.6%, or $247B, there is a significant opportunity for retailers to optimize and learn from the returns processes. However, the perception of returns as a complete loss is misguided.
Shifting the mindset can change the negative narrative of returns to present opportunities not only to decrease return rates but also to drive profitable and sustainable growth across many of the core retail operational areas, including:
- Ecommerce and marketing optimization
- Merchandising
- Product Development
- Assortment Planning
- Return Channel Optimization (Stores, Third Party, and Vendor Management)
It all depends. If the item is fragile or “special” as a gift or easily at risk of damage in the shipment process, then indeed how it is packaged/protected and presented matters. Even weather needs to be taken into account where rain or heat/cold needs to be taken into account by the ship/logistic/packaging entity. The missing elements are evident. Why can’t companies include a thank you card/message to ride along with the package? Why can’t companies employ an A/B test and include a bounceback offer to influence recency / frequency of purchase? Why can’t companies reinforce the “earn” in the loyalty program and how close the member is to achieving a new/better tier or a reward for next purchase? Sure, there is an incremental cost for all of these personalized efforts, but that is exactly what customers are asking for. Show me that you appreciate me. Give me offers/benefits (free gifts) as a surprise/delight with my order. Too often my jeans or sweaters come in a dull/boring clear plastic package then placed inside a delivery service package. Zero branding, devoid of branding and no thank you for your purchase.
Years ago I saw the founder of JetBlue, David Neeleman, speak at a conference. He was obsessed with the time it took for luggage to get from the plane to the baggage carousel. Why? Because he said it didn’t matter how great the purchase experience was, or the flight. If you made people wait too long to get their bags it ruined the entire experience. Digital commerce is no different. You need to start with the basics – meet your promises and deliver on time. It helps build trust and repeat purchases.
Every brand or retailer should dedicate resources to post-purchase feedback and saying thank you. The golden opportunity is for not only thanking the customer, but in asking if they wanted anything else they couldn’t find, and what the specific upside is to be or do better. By turning casual customers into somewhat loyal customers, and somewhat loyal customers into primary customers is worth single digit, sometimes double digit increases in sales, profit and other efficiencies.
Retailers are underestimating the post-purchase experience. They focus so much on sales that they overlook how vital it is to keep customers happy after they’ve made a purchase. There are so many opportunities in improving post-purchase experience like making returns easy and even offering small things like handwritten notes or freebies. This leaves a lasting impression with customers.
Why is this overlooked? Because retailers are too focused on immediate profits and fail to see that investing in post-purchase experiences builds long-term loyalty, which can be more valuable than short-term gains. It’s this shortsighted thinking that needs to change to actually grow real brand loyalty.
This works as an idea as long at the “tactic” is NOT to send me endless strings of emails trying to sell me more stuff. Totally annoying and a time grab that I did not sign up for (going through email and deleting and deleting and deleting some more).
Sadly endless emails is what usually happens.
Kate Terry’s article highlights a common oversight in retail marketing: the post-purchase experience. While significant resources are often dedicated to acquiring new customers, the potential of nurturing existing ones through a positive post-purchase journey is frequently underestimated.
The undervaluation of the post-purchase experience can be attributed to several factors. Short-term sales goals often overshadow the long-term benefits of customer retention. Limited resources can make it challenging for retailers, especially smaller ones, to allocate funds for post-purchase initiatives. Additionally, the lack of effective metrics to measure the impact of post-purchase experiences can hinder prioritization.
In today’s competitive landscape, customer loyalty is paramount. Brands must deliver exceptional experiences at every touchpoint, including the often-overlooked post-purchase phase. Personalized touches, such as AI-generated product recommendations tailored to recent purchases, can significantly enhance customer satisfaction and loyalty.
By recognizing the value of customer retention and investing in post-purchase strategies, retailers can cultivate lasting relationships and drive long-term business success.
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Yes, a good post-purchase experience can build loyalty and stimulate repeat business. Ensuring all hygiene factors – delivery times, accuracy of order, etc. – are critical. However, going above and beyond with things like very nice packaging, a handwritten thank you note, some little freebies, discounts to use on future purchases, can all move the dial. I’ve seen a lot of independent online sellers who are great at these things. Good follow up communication is also important.
What people claim they do – or claim they will do – and what they actually end up doing have only the loosest of corelations. If all else is equal, will people choose one of the merit badge (eco friendly, cute packaging, etc.) winners? Sure; but let the price be 2% higher, and it’s suddenly “look…squirrel!”
A delightful post-purchase experience can transform a customer into an ardent repeat customer. More retailers need to think beyond the transaction and add even more value to the relationship so it lasts. Certain DTC brands grasp the power of pleasing us after the sale.
The post-purchase experience, especially for a first-time customer, can be the difference between a one-time purchase and a future repeat – even loyal – customer.
Ease of returns is the best post-purchase experience and most appreciated by most consumers. I believe second place goes to free goods, and high unboxing, a distant third. Frankly, I don’t believe that “environmental-friendly” works as well because most consumers are highly skeptical.
As we have said dozens of times, loyalty to a brand comes from the combination of good experience across all touchpoints and the overall perception of value (not necessarily a loyalty program). Therefore, post-purchase experience for online purchases is a key element – in large part because the customer did not have the opportunity to engage with the product of sales staff in a physical store environment.
Little details matter, but what is offered as extra value-added services depends on the positioning of the brand in the market and the nature of the product purchased. Brands should think deeply about these aspects to align their costs with the value bump in Customer Lifetime Value that can be created by showing a little more love.
In contrast to the differentiated touches noted, receiving a poorly packaged item with a hard to decipher guide, manual or instruction sheet, and a packet loaded with ads for irrelevant items is off putting. If you’re not making enough money on the sale, rethink your businesses processes. Don’t try to fill your profit gap with in-package or follow-on irrelevant advertising. And don’t cut costs on product use materials.
I would agree that a good number of retailers, across sizes and formats, are missing the opportunity to leverage a positive post-purchase experience into greater loyalty and repeat sales.
Some of the opportunities captured in the article, such as facilitating easy returns and product sampling, are very logical. However, dynamic personalization technology enables each purchase, both of product and of frequency, to apply an understanding of customer interests into a complementary purchase opportunity of related or similar products. In addition, the nature of consumable products inherently provides an opportunity to prompt a customer for a replenishment order or to subscribe to an auto order service that drives repeat purchases while helping a busy customer to stay in stock on regularly purchased items.
Suggesting complementary items, such as new flavors or variants of food and beverage items, complementary items to a recent technology, home decor, or apparel purchase are also logical opportunities as well.
In short, marketers will rightfully recite the cost of retaining and growing an existing customer relationship is always less than earning the business of a new customer. obviously, you should always be doing both, but without a doubt, the post-purchase experience is a great opportunity to earn the next purchase from an existing customer.
Every single interaction with consumers matters, especially the post-purchase experience. While execution at the store and digital platforms is fundamental for success, to help drive and ensure customer lifetime value, retailers have to be transparent and enable customers to control as much of the shopping experience as possible. Loyalty is a fragile thing, and it has evolved beyond just providing points and promotions.
Providing a seamless shopping experience and a frictionless returns process will enhance customer loyalty. Retailers can improve the overall customer experience by being completely transparent about their policies and offering the most convenient returns options.
Historically, retailers have always focused on mitigating product returns, considering them a challenge or issue. With total retail returns coming in at $743B in 2023 at an overall return rate of 14.5% and online return rates at 17.6%, or $247B, there is a significant opportunity for retailers to optimize and learn from the returns processes. However, the perception of returns as a complete loss is misguided.
Shifting the mindset can change the negative narrative of returns to present opportunities not only to decrease return rates but also to drive profitable and sustainable growth across many of the core retail operational areas, including:
It all depends. If the item is fragile or “special” as a gift or easily at risk of damage in the shipment process, then indeed how it is packaged/protected and presented matters. Even weather needs to be taken into account where rain or heat/cold needs to be taken into account by the ship/logistic/packaging entity. The missing elements are evident. Why can’t companies include a thank you card/message to ride along with the package? Why can’t companies employ an A/B test and include a bounceback offer to influence recency / frequency of purchase? Why can’t companies reinforce the “earn” in the loyalty program and how close the member is to achieving a new/better tier or a reward for next purchase? Sure, there is an incremental cost for all of these personalized efforts, but that is exactly what customers are asking for. Show me that you appreciate me. Give me offers/benefits (free gifts) as a surprise/delight with my order. Too often my jeans or sweaters come in a dull/boring clear plastic package then placed inside a delivery service package. Zero branding, devoid of branding and no thank you for your purchase.
Years ago I saw the founder of JetBlue, David Neeleman, speak at a conference. He was obsessed with the time it took for luggage to get from the plane to the baggage carousel. Why? Because he said it didn’t matter how great the purchase experience was, or the flight. If you made people wait too long to get their bags it ruined the entire experience. Digital commerce is no different. You need to start with the basics – meet your promises and deliver on time. It helps build trust and repeat purchases.
Every brand or retailer should dedicate resources to post-purchase feedback and saying thank you. The golden opportunity is for not only thanking the customer, but in asking if they wanted anything else they couldn’t find, and what the specific upside is to be or do better. By turning casual customers into somewhat loyal customers, and somewhat loyal customers into primary customers is worth single digit, sometimes double digit increases in sales, profit and other efficiencies.
Retailers are underestimating the post-purchase experience. They focus so much on sales that they overlook how vital it is to keep customers happy after they’ve made a purchase. There are so many opportunities in improving post-purchase experience like making returns easy and even offering small things like handwritten notes or freebies. This leaves a lasting impression with customers.
Why is this overlooked? Because retailers are too focused on immediate profits and fail to see that investing in post-purchase experiences builds long-term loyalty, which can be more valuable than short-term gains. It’s this shortsighted thinking that needs to change to actually grow real brand loyalty.
This works as an idea as long at the “tactic” is NOT to send me endless strings of emails trying to sell me more stuff. Totally annoying and a time grab that I did not sign up for (going through email and deleting and deleting and deleting some more).
Sadly endless emails is what usually happens.
Kate Terry’s article highlights a common oversight in retail marketing: the post-purchase experience. While significant resources are often dedicated to acquiring new customers, the potential of nurturing existing ones through a positive post-purchase journey is frequently underestimated.
The undervaluation of the post-purchase experience can be attributed to several factors. Short-term sales goals often overshadow the long-term benefits of customer retention. Limited resources can make it challenging for retailers, especially smaller ones, to allocate funds for post-purchase initiatives. Additionally, the lack of effective metrics to measure the impact of post-purchase experiences can hinder prioritization.
In today’s competitive landscape, customer loyalty is paramount. Brands must deliver exceptional experiences at every touchpoint, including the often-overlooked post-purchase phase. Personalized touches, such as AI-generated product recommendations tailored to recent purchases, can significantly enhance customer satisfaction and loyalty.
By recognizing the value of customer retention and investing in post-purchase strategies, retailers can cultivate lasting relationships and drive long-term business success.