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Happy returns: retaining your customers is a lot less expensive than getting new one. So how do you keep them coming back for more?

Entrepreneur, Jan, 2004 by Melissa Campanelli

E-TAILERS, LIKE BRICK-AND-MORTAR businesses, should always strive for repeat business from customers. After all, statistics say it costs five to 10 times more to find new customers than it does to keep the ones you already have.

Jeremy Shepherd, founder of $3 million e-commerce site PearlParadise.com in Santa Monica, California, understands the importance of return customers to his jewelry business. "We've been working hard to build relationships with repeat customers," says Shepherd, 30. "Repeat customers are our best customers. They buy more than new customers."

So if you've been neglecting this important aspect of your e-business, now's a great time to start developing that strong foundation of repeat customers.

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Sweet Rewards

PearlParadise.com encourages repeat business with its "Pearl Points" program. With each order, a customer receives one or several "Pearl Points" coupon cards, depending on the amount of money spent. Each card is worth 10 points, and each point is worth $1.

Using an opt-in customer database, PearlParadise.com has also found success offering special sales to its repeat customers. "These are sales for special pieces that I may have received for an incredible. deal at a farm," says Shepherd. "Instead of offering a deal that is obviously too good to be true to the general public, I send an e-mail message out to [customers on] our opt-in list, tell them how many products we have, and send a link to a hidden page accessible only by that e-mail." Shepherd offered this type of special offer last Mother's Day and sold out of nearly 100 pearl strands within a matter of hours.

Business Services Industry

Happy returns: retaining your customers is a lot less expensive than getting new one. So how do you keep them coming back for more?

Entrepreneur, Jan, 2004 by Melissa Campanelli

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