Imagine a world where the definition of a customer was someonewho buy’s a company’s goods or services more than once. In fact don’t imagineit, apply this definition to your business now and see what effect it has.

We regularly talk to companies where more than half of their customerswouldn’t be counted under this definition because they have only bought once.Half of the customers they think they have would not be included in theircustomer metrics.

I’m a great believer in playing with data and this is oneexercise that I urge you to try. Rerun all your customer numbers using thisrevised definition of a customer. The numbers when it comes to things likeretention rates, customer engagement rates, spend per customer etc will betruly enlightening.

The simple truth is that a one-off customer is not really yourcustomer – they belong to one of your competitors. Including these customers inyour metrics is a false comfort blanket that is hiding the true picture ofwhere your business is.

You should really view a one-off customer as still being aprospect. You’ve worked really hard to get them to the first purchase and nodoubt spent a lot of money too – but the job is far from complete.

Getting new customers to a second purchase is extremelydifficult. 68% of customers will never purchase a second time according toresearch from multiple ecommerce benchmarks (Ecommerce Buyer Behavior,Ecommerce Growth) and the trends Shopify Plus’ Tommy Walker

But encouraging repeat customers creates long-lasting,profitable relationships. Not only are your repeat customers purchasing moreover time than new customers, they spend more per visit and tend to purchasemore expensive products or services.

While only 32% of first purchasers will make a secondpurchase, 53% of customers that make a second purchase will make a third. Andwith each successive purchase, the likelihood of them coming back increases.

Acquiring new customers is great but getting them to buy thesecond time is even better. A second purchase is a key step towards becoming ahigh-value customer. What’s more, it is significantly cheaper to get existingcustomers to buy twice than finding new customers altogether. In fact, theprobability of selling to an existing customer is 60-70%, while the probabilityof selling to a new prospect is only 5-20%.

You need to start building a relationship from the verybeginning of a customer’s journey with your company, engaging them withrelevant information at each stage. You want to actively move prospects throughthe funnel until the point where they become repeat buyers.

A key cornerstone of this activity should be some form ofnurture programme. A nurture programme is a series of triggered communication timedaround an average frequency of purchase for an industry sector. The communications mayinclude offers and incentives. It should include recommendations on next products to purchase. This could be based on best selling products or it could be based on affinitymodels - a set of models that predict the most suitable next product to buy.

Whatever is in your nurture programme it is important it is measured correctly. Don't just measure it on how many sales have been made, you need to measure how many customers have made a second purchase.

Further Reading

If you would like to read more about how to make more income from the customer data you already have then read this article.