Given the high cost of acquiring customers, the results show that for e-tailers to recoup that investment, they need to convince customers to return to their site again and again. The study found that the average online apparel shopper was not profitable for the retailer until he or she had shopped at the site four times. This implies that the retailer has to retain the customer for 12 months in order to break even. The findings also found that loyal online customers, just like offline customers, spend more, refer more people and are more willing to expand their purchasing into new categories. Furthermore, online retailers, in most industries, must provide customers with fair, but not necessarily the lowest, prices.
Delighting customers is the clear determinant of e-business success or failure.
The few companies that succeed in these areas have significant competitive advantages over their competitors and a business model that, in the long run, is best positioned for long-term success. Although much attention has been focused on site design and infrastructure, making room in the budget for customer retention tools is a must for companies to become profitable. Investing in customer retention is perceived as less glamorous than investing in slick Web site design, but unless companies can turn eyeballs into repeat customers, they don't have a viable business. According to a report by Forrester Research , the success of early e-commerce has made Web site availability and performance mission critical, but customer satisfaction through other means must soon take shape. Prior to transacting, Forrester says companies should apply load and usability testing to their site design to improve a visitor's experience.