Which Levers can Improve Customer Retention Rates?
An emerging health and wellness e-commerce platform, "WellnessHub," aims to improve its user retention rates significantly. The platform offers a variety of health supplements, fitness equipment, and wellness services.
Complication:
WellnessHub's current retention strategies are not effectively engaging its diverse customer base, resulting in low retention rates. The challenge lies in identifying and implementing specific retention levers tailored to their varied user demographics and preferences.
Objective:
Your role is to analyze WellnessHub’s existing retention strategies and user data to identify and deploy targeted retention levers. The goal is to create a balanced approach that incorporates demand-side, supply-side, product-side, on-platform, and off-platform strategies to enhance user retention effectively.
Specific Questions:
Question I: Collecting Benchmarks and Metrics
Which are the relevant benchmarks and metrics to collect for assessing user retention at WellnessHub? What sources would you use to gather this data, and why?
Question II: Demand-Side Insights for Retention
What key user data points would you analyze to identify high-value segments for retention at WellnessHub? Include specifics on demographics, purchase frequency, and engagement metrics.
Question III: Supply-Side Strategy for Product Availability
How would you ensure that WellnessHub maintains a diverse and high-quality product selection to maximize retention? What criteria are crucial for evaluating the impact of product variety and availability on retention rates?
Question IV: On-Platform Engagement Tactics
Design an experiment to test the impact of personalized product recommendations on user retention. What steps would you take to implement this feature, and how would you measure its effectiveness?
Question V: Off-Platform Communication Strategies
Design an SMS campaign to re-engage users who have not made a purchase in the last three months. What key elements would you include in the campaign, and how would you measure its impact on retention?