Customer Loyalty

How Ecommerce Brands Win with Value-Added Services

Angela Marrujo
December 1, 2021

If you think your ecommerce customers will always be loyal, think again.

Zendesk estimates that half of customers will churn after a single bad experience, and 80% will leave after several negative experiences. A “bad” experience can range from an unhelpful, text-heavy product page to a cumbersome return process.

Value-Added Services: A New Wave of Innovation

The new wave of innovation in customer experience is value-added services. It started with free shipping, then evolved to two-day shipping, both of which are table stakes now. In the last five years, value-added services have proliferated across retail. Merchants combat customer frustration and build better relationships with value-added services, from the moment customers start browsing products to making sure they can continue to use their products.

Not sure how to start offering value-added services? These five brands are redefining what it means to be customer-centric. They know adding value to each stage of the customer experience is the key to standing out from the competition. 

JBL: Helping Customers Choose with Product Recommendations

For consumers, shopping online can often feel like a maze. With so many retailers and products to consider, consumers often don’t know where to turn.

Guide the customer to the best item for their needs with product recommendations, based on intelligence from previous clicks and purchases. Salesforce shows how powerful this “helping hand” can be, estimating that recommendation clicks lead to 24% of orders and 26% of revenue in the ecommerce space.

The audio retailer JBL offers a carousel of recommended products on each product page to help customers find the exact model they need—along with items they didn’t know they wanted.

JBL doesn’t stop there. They add even more value to these carousels by including customer ratings and customization options alongside each recommended product image.

Pro Tip: Save customers clicks by including relevant information alongside your recommended product images. Is the recommended product on sale? Is its color customizable? This information can help customers more quickly narrow their searches.

Backcountry: Nurturing the Customer Journey with Live Chat

According to a 2017 Capgemini study, 70% of customers who develop an emotional relationship with a brand spend up to two times more with those retailers. Traditionally, salespeople built these relationships through in-person interactions with shoppers. But in the eCommerce space, these human connections can still exist.

With live chat, ecommerce shoppers can consult a human for product support. No need to worry about consumers adapting to this technology. A 2019 Salesforce study indicates that 40% of customers in North America prefer live chat as their method of support.

Outdoor retailer Backcountry uses live chat to give customers access to “Gearheads,” who are much more than a support team. They’re fellow outdoor sports and recreation enthusiasts. They can help you choose a running shoe as easily as recommend a good trail outside of Provo, Utah.

Live chat isn’t just convenient—it also helps companies build a loyal customer base. Live reps can help shoppers find a product that truly fits their needs, so a return is unlikely. And when support teams go a step further to help customers personally—like making that trail recommendation—they’re one step closer to winning an emotionally connected customer.

Pro tip: If it’s not possible to have live reps on chat 24/7, consider setting up a chatbot program. These chatbots can send automated responses to common queries, and they can pass complex issues on to live reps.

Bear: Emphasizing “Easy” with Frictionless Returns

An ecommerce brand’s return policy can drive purchases and make or break the customer relationship. Easy returns can help motivate a customer to make a purchase knowing they have a safety net if they’re unsatisfied. Narvar reports that if a return policy is “easy” or “very easy,” 96% of customers would continue shopping at the business. 

Bedding retailer Bear makes life easier for their customers by allowing them to sleep on their mattress for up to 100 nights before returning. Even better, a customer can initiate a return with a simple email, and Bear will arrange to pick up the unwanted mattress. That’s it!

Pro tip: To a customer, placing a phone call to make a return can mean hours on hold. Use digital and self-serve channels for returns whenever possible to make the process more convenient. Structuring your returns policy in Q&A form makes it easier to digest.

Jewlr: Encouraging Repeat Purchases with a Loyalty Program

Because they reward customers for repeat shopping, loyalty programs are an excellent way to increase customer retention. And according to HBR, companies with strong loyalty marketing programs grow revenues 2.5x faster than their competitors.

Online jewelry retailer Jewlr knows that their customers want to feel like VIPs, so they offer a robust point-based loyalty program. The more Jewlr shoppers spend, the more special perks they receive.

A customer becomes a VIP simply by signing up for the program online. Jewlr starts a new VIP with 1000 “Jewls” (points), even if they have not yet made a purchase. With every new purchase, customers accrue Jewls, which can be redeemed as savings on additional products. This program unlocks additional value-added services like free 2-day shipping and early access to new products.

Loyalty program benefits can be based on a number of factors—including points, amount spent, number of purchases, or number of new customer referrals.

Pro tip: Don’t assume there’s a “right” structure for rewards systems. Don’t be afraid to test different program structures until you find the one that most resonates with your customers.

Solo Stove: Protecting Their Customers and Their Bottom Line with Shipping Insurance

As we mentioned before, returns are a pain point for both merchants and their customers. Merchants lose money and risk losing customers if the return experience is unpleasant and time consuming.

Ecommerce merchants face a greater risk of returns than brick-and-mortar stores, because their items can be damaged during shipping. According to a 2020 SaleCycle study, 80% of ecommerce returns result from the product arriving broken.

Even if the product arrives safely, package theft can send the customer back to the merchant with a claim. 24% of respondents to a 2019 Shorr survey indicate that they have been victims of package theft.

Since theft and damage are so common, grill and stove retailer Solo Stove offers their customers optional shipping insurance through a third party.

Customers can easily add the insurance to their online shopping carts while browsing items. If a customer needs to initiate a claim, all they need is their email and order ID. The insurer takes it from there.

Pro tip: UPS and FedEx do offer shipping insurance, but it often isn’t sufficient to cover the cost of the shipped merchandise. Merchants should consider third-party shipping insurance providers, such as Route, which has more coverage options and better customer service.

The Most Important Service? Product Protection

Amazon, Best Buy, and Walmart drive loyalty with one-day delivery, easy returns, and product protection. All of these services are valuable, but product protection keeps customers using products. In a world where it’s so easy to switch to a competitor, a working product is the best way to box out competition. 

Merchants who sell plans offered by Extend want to delight their customers with quick claim processing. Owning that part of the customer relationship gives them a clear competitive advantage. 

The data speaks for itself:

Our internal research reveals that customers who purchase our plans from a merchant partner repeat at a rate 4.5% higher than customers who haven't purchased a plan from that merchant.

Extend’s digitally native, full-stack offering is redefining the product protection experience, offering protection against an array of product failures that traditional insurers may not cover. We can handle everything from offer merchandising and optimization to claims adjudication to an amazing end-to-end customer experience. All so that merchants get more time to do what they do best: selling their products.

To become one of Extend’s merchant partners, click here for a demo.

Angela Marrujo
Angela Marrujo is a content creator at Extend.

Our latest articles