E-Commerce: It’s Much Easier to Convert A Shopper to A Repeat Purchase Than A First One

August 10, 2022

This article is included in these additional categories:

Brand Loyalty & Purchase Habits | Brand-Related | Customer-Centric | Industries | Retail & E-Commerce | Spending Trends

Existing retail customers are much more likely to convert than non-buyers, and their likelihood to keep coming back for more purchases grows with every successive purchase made with a retailer, according to Bluecore’s 2022 Retail E-Commerce Benchmark Report [download page].

As part of the report, Bluecore examined data from 35.5 billion campaigns across email and site sent by a subset of its e-commerce customers in 2021. The analysis found that the percentage of non-buyers (shoppers who a retailer had identified but who had not yet made a purchase) who converted to a first purchase varied from 0.05% to 2.14%, depending on the vertical.

The vertical that converted the highest percentage of non-buyers to a first purchase was Home Goods (2.14%), followed by Health & Beauty (1.9%). On the other end of the spectrum, the Gifts & Floral (0.27%) and Footwear (0.05%) verticals struggled the most to convert non-buyers to a first purchase.

In each case, retailers were much more successful in converting one-time buyers to make a repeat purchase, with the conversion rate in this case ranging from a low of 1.59% to a high of 8.52%.

On this metric, the Health & Beauty vertical came out on top, with 1 in every 12 one-time buyers making a repeat purchase (8.52%). The Apparel (7.33%) and Footwear (6.85%) verticals also performed well on this measure, with the latter showing a huge disparity between conversion rates for first-time purchase and repeat purchase.

Although the Gifts & Floral vertical category was again the lowest-performing, with the percentage of one-time buyers that made a repeat purchase standing at 1.59%, that was still well above its first purchase conversion rate.

“The More A Shopper Buyers, The More Likely They Are to Complete A Next Purchase”

Additional findings from the report indicate that each successive purchase ups the likelihood of another. Indeed, the likelihood of shoppers buying again is roughly 3-5x higher for those that have made several purchases than those who have made a single one.

The trend is most evident for the Consumer Electronics and Sporting Goods verticals, for which the likelihood of a next purchase is almost 5 times higher for those with a 6th purchase than a first.

It’s also not something new, and likely demonstrates a core shopper lifecycle behavior: back in 2015, research likewise found that “a customer’s repeat purchase rate steadily increases with each incremental purchase.”

Not surprisingly, then, this latest study states that predicted customer lifetime value becomes almost uniformly higher with the more successive purchases shoppers complete.

Still, it’s true in general – given low conversion rates overall – that the largest share of total purchases are made by first-time buyers, who also account for the largest share of a retailer’s shoppers. The analysts also note that “the steep drop-off from the second to the third purchase across almost every vertical indicates a need for campaigns that continuously nurture shoppers, bring them back into the fold, and cultivate their ongoing loyalty.”

For more, download the study here.

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