Customer retention strategy: The key to a successful and scalable D2C business

By Simantika Choudhury
October 13, 2022, Updated on : Thu Oct 13 2022 16:26:51 GMT+0000
Customer retention strategy: The key to a successful and scalable D2C business
CM.com has been helping many D2C brands elevate their customer retention strategy through their host of services such as Customer Data Platform (CDP), Mobile Service Cloud, and Scripted Chatbot.
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If there was one sector that truly boomed during the pandemic, it has to be India’s D2C sector. The sector, which has had a dream run in the past few years, accelerated further during the lockdown as more vendors and customers got online. Many new-age digital-first brands did away with traditional distribution channels like wholesalers and retailers, and grew rapidly on the wings of India’s robust digital infrastructure, access to smartphones, its vast population of 700 million internet users, and online shopper base of 140 million.


But it isn’t all about the ease. The Direct-to-Customer model came with a lot of benefits too. It gave brands immediate access to customers and their data, higher margins, scope for more customer engagement, and visibility on end-to-end functioning. It is because of these factors that today India has over 800 D2C brands, with many coming up each month to keep up with new-age India’s demands. The sector was approximately worth $44.6 billion in 2021 and projected to touch $100 billion by 2025.


But this growth comes with its own share of challenges - mainly intense competition and rise in customer expectations. Brands are spending millions on marketing and they are cutting margins to appeal to their customers. After all, customer retention is key.

The road to retention

It is no secret that brands that manage to create a meaningful customer experience garner high retention rates. Customer acquisition and retention have both risen to become the most important parts of a D2C brand journey. But as per studies, acquiring new customers is five times more expensive than retaining them. Customer retention also increases profits by 25 percent to a whopping 95 percent.


Customer retention is more than a competitive edge, it is the tool to help D2C brands accelerate growth and scale. We are living in a world where customers have so many options to choose from, that it has become critical for brands to ensure there is loyalty and great experience. Most experts agree that customer retention is pivotal to business growth and ensures profitability. Apart from regular business, loyal customers are necessary because they recommend their favourite D2C brands to their friends, thereby increasing the brand’s popularity.


The main ingredients behind a good customer retention strategy are brand awareness and a perfect customer experience. But how can brands accomplish this? It stems from truly understanding the customer and then offering them personalised services. Most D2C brands looking to create a robust retention strategy usually go with the following - better customer service, email campaigns, special discounts, loyalty programs, easy shipping and returns, SMS marketing campaigns, and a personalised experience. A combination of these can lead to an amazing frictionless journey.


But to start off with these, D2C brands need to finalise their partner. For many D2C brands, that partner has been CM.com. Through their conversational software, CM.com helps brands instantly connect with their customers and offer them a personalised experience.

Tools that help

CM.com has been helping many D2C brands elevate their customer retention strategy through their host of services such as:


Customer Data Platform (CDP): CM.com noticed that many brands have large amounts of data, but their core business is not digital. In such a case, their customer data is generated across multiple systems that have no marketing and communication capabilities. CDP helps in eliminating data silos and creates 360-degree customer profiles by centralising and unifying data from all offline and online sources. It lets customers connect multiple data sources into one unified customer profile giving D2C brands real-time insights into their customer's behaviour.


Mobile Service Cloud: Seamless customer experience is a must for retention. Mobile Service Cloud offers a frictionless service experience by letting brands communicate with their customer through their preferred channel. It helps increase customer satisfaction, boosts efficiency and productivity, and maximise ROI and conversions. The Mobile Service Cloud lets brands collaborate with all teams - external and internal, integrate it with systems of their choice, and automate conversations with their own chatbot.


Scripted Chatbot: CM.com’s chatbot helps provide a unique automated experience. It offers 24x7 availability, increased customer satisfaction, boosts employee efficiency, improves response time, increases revenue and instant answer to queries. Through the chatbot, brands get access to features like sharing pictures, movies, emoticons, sound and even location. The chatbot can be built very easily using a drag and drop interface, without any coding. Brands can add different entry points, input variables and logic to define the conversation. The chatbot also ensures seamless live agent takeover.

Scaling with loyalty

These services don’t just increase customer engagement and retention, but they make it so much easier. For example, SMS has an open rate of 98 percent, which means it has incredible reach. To update customers on delivery or shipping, SMS is a perfect notification method. Mobile Service Cloud also is a great t00l to make customers feel heard. Whenever they have a complex query, they can speak with the brand through their preferred channel and sort it.


Coming to Customer Data Platform (CDP), it enables brands to recommend related products based on their users’ order histories, or serve targeted Instagram or Facebook ads.


Scripted Chatbot is a critical tool, as it can help in notifying customers about upcoming offers, book a restaurant table for them, or guide them to the nearest store via location, among other things.


These just highlight how brands can continue engaging with their customers even after their journey is completed, and today it is more important than ever. As the world grapples with post-pandemic changes, one thing remains constant - the D2C sector is going to continue scaling. Customers are going to expect more and more from their favourite brands, and loyalty will prove to be the winner. Brands will need to pick their partner and the technology tools to thrive before the rest of the world.


To know how CM.com can help you with user retention,


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