Marketing in a Minute – Episode 20 | Ahmed Moaaz

What percentage of first-time buyers come back to buy again? Improving this number alone changes LTV, CAC calculations and the entire budget.

What is the repeat purchase rate?

The question this episode answers: out of every hundred customers who bought from you a first time, how many return to buy a second time? This is the repeat purchase rate, and it is the most honest test of your customers’ real satisfaction.

The formula: repeat purchase rate = customers who bought more than once ÷ total customers × 100. Example: you have 800 customers in total, of whom 240 bought twice or more. The rate = 240 ÷ 800 = 30%.

The number may look like a sibling of the retention rate from the previous episode, but the difference matters: retention looks at a specific time window, while repeat purchase looks at the customer’s entire history. The first asks “did they stay with us this month?”; the second asks “did they ever come back after the first time?”

Why is the first second purchase the most important?

Because the move from the first purchase to the second is the hardest jump in the customer’s relationship with you. E-commerce statistics show a repeating global pattern – illustrative figures that vary by market: the probability of a customer returning for a second order may be around 27%, but those who bought twice see their probability of a third purchase rise to about half, and those who bought three times approach being lifetime customers.

The practical meaning: all post-sale effort should concentrate on pushing the customer to their second order. After it, the customer becomes “hooked” on the habit of buying from you, and the cost of keeping them drops sharply.

What is a good number?

It depends on what you sell:

• Recurring consumables (coffee, care products, foods): high rates are natural; 25-30% and above is possible because the product runs out and gets repurchased.
• Medium-lifespan products (clothing, accessories): 15-25% is a reasonable range.
• Long-lifespan products (furniture, appliances): a low rate is natural; here the standard shifts to complementary products and referrals.

As always: compare yourself to yourself first. Your rate rising from 18% to 22% matters more than matching a global average from a different market.

How do you raise the rate?

• A post-delivery message: a few days after the order arrives, ask about the experience and offer a usage tip. The customer who feels cared for returns.
• A second-order incentive: a small discount coupon valid for a limited period, dedicated only to the next order. The urgency here is deliberate: every day of delay distances the customer.
• Suggest the logical next item: whoever bought coffee needs filters; whoever bought shoes needs care products. A suggestion built on their first order is ten times better than a generic offer.
• Remind them before it runs out: consumables have a known lifecycle; a message a week before depletion achieves excellent return rates.
• A simple loyalty program: a point with every pound, redeemable for discounts – even a manual system at the start.
• Fix what breaks trust: if your rate is very low, do not start with incentives but with investigation: review complaints, product ratings and return reasons first.

A practical example with numbers

A store gains 200 new customers a month, has a 20% repeat purchase rate, and an average order profit of 150 EGP. One month’s customers generate over their lifetime: 200 first orders + 40 second orders + about 15 third orders – about 255 orders in total. If the store raises the rate to 28% with a second-order incentive campaign: 200 first orders + 56 second + about 25 third – about 281 orders.

The increase is 26 additional orders over the lifetime of each monthly cohort, worth about 3,900 EGP per cohort, arriving gradually over the following months; and with a new cohort every month, the effect at steady state approaches 26 orders and 3,900 EGP extra per month – all from customers who already exist, without a single advertising pound to bring them.

Common mistakes

• Measuring too early: last month’s customers have not yet had the chance to return. Measure on cohorts at least three months old.
• Mixing long-lifespan with recurring products: a store selling both needs two separate numbers, or the rate will appear unfairly low or illusorily high.
• Forgetting that incentives teach: a customer trained to buy only with a coupon raises the rate while eating your margin. Make the incentive a bridge to the second order, not a permanent habit.

Where do you start this week?

Four simple steps are enough:

1. Extract the current number: from your store reports or customer list, how many customers bought more than once out of all who bought three or more months ago?
2. Identify the most common first product: what product do most of your customers start with? Prepare the naturally fitting “second order” offer for it.
3. Prepare one message: sent, say, ten days after delivery, thanking the customer and suggesting the logical next product with a small incentive.
4. Watch for two months: compare the new-customer cohort with previous cohorts, and you will see the effect of the message and incentive on the number directly.

Do not launch ten initiatives together; one well-designed message whose effect you measure clearly beats five messages where you cannot tell which worked. Once its effect is proven, expand gradually: add the depletion reminder for consumables, then the points program, and measure each addition separately until you build a complete retention system step by step.

Summary

The repeat purchase rate is the pulse of your customers’ loyalty. Calculate it from your data, classify it by product type, and aim your best marketing effort specifically at pushing the customer to their second order. A business built on returning customers needs fewer ads every month than a competitor constantly replacing its customers – and that is the difference between growth that accumulates and growth that evaporates. Start with one message this week, and the result will surprise you within two months. A customer who returns once will usually return many times, and every return is nearly free profit with no new acquisition cost paid.

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