Dropshipping, or shipping your product direct to your buyer, is a great business model for entrepreneurs and online marketplaces. With low-risk, low-cost and a highly automated approach, it’s understandable that so many retailers and distributors are turning to dropshipping. But, as with all things, there is a flipside. Dropshipping retention rates are notoriously low — we hear it from our own clients, because let’s be honest, most shoppers don’t really like the idea of being dropshipped to. Dropshipping your product also means you relinquish some control over your delivery process. If the dropshipper makes an error, you end up with an unhappy customer, which is not a great reflection on your business.
Customer retention is an integral step on the way to success for any ecommerce business. In fact, research carried out by Adobe revealed that repeat customers generate more than 41% of a store’s revenue. So it’s important to make that purchasing experience for the customer a good one. To help, we have come up with a few handy tips to increase retention rates as a dropshipper:
Select a superior supplier
Your supplier controls all the physical aspects of your business, from packing and shipping to the returns process. Your supplier plays a pivotal role in how your business functions, so you need to ensure you are working with reputable and trusted providers. Taking the time to research who would be the right fit for you will save you time in the long run when you’re not having to worry about lost or delayed orders.
It’s also important to make sure your supplier has a good delivery program, as delivery performance and the supporting technology can vary across the board. Don’t be fooled into thinking low cost may be saving you a few dollars, as this may come at a price (pun intended) - that price being poor delivery service. Make sure to enquire about timeframes, tracking, methods of shipping, and years in business. And a good tip is to always request testimonials from current customers!
Create and customize
Customized packaging not only disguises that fact that your product is dropshipped, but also ensures your branding is well represented. With branded packing slips, labels and customized packaging, your customer will be able to recognize their order immediately and identify it with your brand, even if it was packaged and processed by someone else. Plus, unique packaging provides your customer with a better unboxing experience – making that first impression count!
Customized and branded packing slips also allow you to upsell, such as including complimentary items or suggestions of accessories to accompany the product being delivered. These are easy for your supplier to print, and encourages future purchases.
There’s more to custom packaging than just adding your logo. We suggest including information on the returns process. Returns go hand-in-hand with the world of ecommerce, so the easier you can make the process, the more likely a customer is to use you again in the future.
Communication is key
Buying online means your customer already feels distanced from the product – literally! When someone buys through your store, they’re putting their trust in you, so it’s important to keep the lines of communication open. Ensure email updates are sent to inform when the order is being processed, dispatched, the estimated delivery date, and a tracking number. As they say, the devil is in the detail.
Satisfaction equals success
Our final tip applies to so much more than just what we’ve discussed so far. The reputation and life span of your business depends on the happiness of your customers, so customer satisfaction needs to be at the forefront of your priorities. Always. Short-term profit, while appealing, is not worth long-term losses.