Visualize first-time customers
If you do not give a priority to develop repeat customers, I suggest checking the rate of first-time customers of your business. It should be enough information to recognize its importance.
On average, the rate of the first-time purchaser is approximately 70%.
You may invest a lot of your time and costs to acquire new customers such as writing articles, posting SNS and adjusting internet ads. However, 70% of them make only one purchase. Please check the rate in your shop to confirm the fact.
The way of confirming the rate of first-time purchasers
First-time purchasers are those who only made one purchase of your products or services.
Mostly, you can check the number of them like this way:
First, log in to the administrator panel of your online shop.
Next, search the customer database with the condition that the number of purchasing is only one.
In the case of this shop, the result is approximately 16,000 customers. Since the shop has 20,000 customers, the rate of the first-time purchaser is 80%.
To explore current situation of your business, it’s good to identify the transition rate from First-time to Over first-time customers for consecutive years. How many customers purchase products more than once compared to first-time purchasers?
|First-time customers||Over first-time customers||The transition rate|
|2017||7,000 people||1,200 people||14.6%|
|2016||6,000 people||1,000 people||14.2%|
|2015||5,000 people||1,000 people||16.6%|
The data shows only 14.6% of new customers purchased again from your shop in 2017. Ideally, it’s better to exceed 50%.
The customers who purchase more than once within 3 months will grow consistent purchases.
I would like to give you another interesting the fact featured how to improve the transition rate.
Some studies indicated that the customers who purchase products from your shop more than once within 3 months will grow to consistent purchases 7 times more than the customers who purchase only once in the same duration.
This is called “Mere Exposure Effect”, which means that people prefer things that they are most familiar with.
If you hope that the customers prefer your business, it’s good to reach out to them several times in a short period of time.
Those are important facts of Repeat strategy. If you want to improve your profit, it’s important that you pay attention to how to develop repeat customers. Otherwise, you will waste your time and money for the first-time purchasers.