Marketing Tips

How to make the most cost-effective eCommerce marketing investments to grow customer loyalty and revenue.

June 2, 2022
A women opening a retail shopping bag with tissue paper inside and an eCommerce box with tissue paper inside

With the rise in popularity of eCommerce shopping, brands have noticed a shift in buying patterns and preferences. This inevitably affects how brands invest their marketing dollars, but how specifically?

Historically, retailers have invested heavily in the in-store experiences, creating an extension of their brand to the physical space. But how does this evolve with a growing number of in-home purchases?

apple retail store showing the in-store experience
Source: https://unsplash.com/photos/gccbrmlXZ7g

 

With more shoppers making purchases from the comfort of their own homes, it is crucial that businesses consider a brand experience just as convenient and immersive as walking into a store.

Seaman Paper helps brands do just that. In order to achieve the most optimal unboxing experience, it is important to excite your customer from website to doorstep. This will in turn drive more traffic, and brand loyalty to your site.

The transition from brick-and-mortar to eCommerce retail:

Is your brand doing all that it can to create the best shopping experience?

The shift from traditional brick-and-mortar retail to online has certain financial benefits, like not having to invest in as many physical stores. However, what’s the tradeoff here? Does a more impersonal and transactional “deliver the goods” to customers approach carry a hidden price for brands? Or could the right investment in doorstep marketing actually increase customer retention while decreasing product return rates? Spoiler alert: yes, it can.

 

a woman on her laptop shopping online
Source: https://unsplash.com/photos/Nv-vx3kUR2A

Traditional brick-and-mortar retail used to be the standard for shoppers, but now with 2.14 billion digital buyers, companies should consider how this evolves their marketing strategies to maintain customer loyalty and grab a competitive edge.

Now that customers are not immersed in your physical retail locations, it is important to foster the digital equivalent for your brand, from website to doorstep.

Customers still expect the same personalized and branded experience even though they’re not there in person.We’ve observed that not providing such an experience has a negative short-term impact on repeat purchases and return rates while negatively affecting long-term brand loyalty. When using branded packaging, you are personalizing the unboxing experience for your customers. Imagine opening a box filled with plastic air pillows or crumpled brown paper. This does not have the same personalized effect as unwrapping your products with colorful, branded tissue.

Not evolving your online shopping experience has consequences.

As brands consider evolving their marketing budget allocation, it’s worth understanding the direct impact of the website-to-doorstep experience on customer retention and value.

73% of people prefer brands that personalize the shopping experience.

Source: Smallbizgenius

When brands choose not to evolve their eCommerce experience, this results in smaller customer basket sizes, fewer repeat purchases, and higher product returns. What’s more, returns are incredibly expensive for brands.

CNBC recently reported that the average return adds up to 30% of the purchase price. With an average margin for an online order hovering at 10-15%, and the average cost of one return is $15.00, that does not add up in the brands’ favor. Take this scenario, for example:

  • A consumer buys a $50 pair of jeans
  • The brand will net a 10% margin of $5.00
  • But if the consumer returns the jeans, this costs the brand $15.00

This adds up to a loss of $10.00 for the brand. In this scenario, the brand is in a worse place than if they hadn’t sold the jeans in the first place!

Considering that the average return rate in 2021 was 21%,the financials start to get ugly quickly!

Brands are overlooking a very expensive mistake that has a very inexpensive solution.

Brands are spending record amounts of money to acquire new customers. CMO Survey found that internet sales as a percentage of revenue in 2020-2021 were at 19.4% – the highest in a decade – and an 11.5% increase in digital marketing budgets.

You’d think this would spell record sales and profitability for companies, but the increasingly transactional approach brands are taking online is having the opposite effect.

Many brands place a higher value on investing their marketing budget into acquiring new customers while neglecting to take care of the ones they already have.

New customer acquisition is expensive, and brands are spending more than ever here:

  • Acquiring a new customer can cost 5 times more than retaining one you already have (source)
  • Increasing customer retention by just 5%can increase business profits by 25%-95% (source)
  • The success rate of selling to a customer you already have is 60-70% while selling to a new customer is5-20% (source)
  • When consumers have a positive experience, they become likely to spend 140% more than customers with a negative experience. (source)

So, in review, repeat customers cost less than new ones. They buy more and return less – why aren’t brands paying more attention to this?

They’re missing the secret weapon: the unboxing experience.

The product return rate across various retailers was 21% in 2021. However, the right doorstep branding experience reduced return rates by 6.6%.

What’s more, “packaging is potentially one of the better value-for-money last-mile improvements for online retailers. The added cost to the retailer of premium packaging to the retailer was less than 10¢ per shipment.” (source)

A woman unboxing a package with plastic packaging compared to a package with branded tissue paper

With so many options available to consumers today, retailers can’t afford to ignore the impact that the in-home brand experience provides to their customers (and their revenue).

58% of people stop doing business with a company because of poor customer experience. (source)

Elevate your eCommerce marketing through the in-home experience

Investing in the in-home experience for your consumers allows your company to grow customer loyalty and revenue. SeamanPaper makes this an easy & sustainable practice to adopt.

Our mission is to give your customers the optimal unboxing experience so that the in-store experience carries to the comfort of their own homes. Bringing your storefront to their homes has never been easier.

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