How to Boost Your Shopify Retention & Customer Lifetime Value

You know how in those soap operas and movies that show two people falling in love at first sight and they don't get to express it? Then somehow "fate" drives them back together in future for a happily ever after?

Turn off the TV and go outside. That doesn't happen in real life.

In real life, you would have to run after "your love", convince them they are the "spouse of your dreams", then it ends with them hitting you on the head with a purse because you are creeping them out.

The same goes for a business. You don't expect your customers to come back just because the product is good. And you don't just tell them, "Come back to me because we are meant for each other". Uh-uh. You follow a strategy and take steps to show them their value to you then when they need the same product or service, they will come back.

It is more effective and cheaper than marketing every time you want to sell so you would pretty much expect most business to focus on it, but do they?

Nope, they don't. A whopping 44% of businesses do well more on acquisition vs. 18% who focus on retention.

What could be the reasons for this ignorance misplaced focus?

Well, the reasons vary. But a common one, which is the same reason I hit snooze this morning instead of waking up to exercise, is our tendency to seek instant gratification. The results of an acquisition campaign are instant while those of a retention campaign will have you waiting for years.

But are they really worth the wait?

Yes, they are. And I am about to show you why. I will also take you through tips and strategies to help you boost your Shopify retention and customer lifetime value.

Let's get to it.

Why is Retention Important?

I thought you'd never ask!

I will explain the importance of retention through a simple illustration. But before we get to that, you need to understand two things: customer acquisition cost (CAC) and customer lifetime value (CLV).

CAC is the amount of money you spend to acquire a new customer and LTV is the total value of the customer over the whole period of your relationship with them.

Now, on to the illustration…

Let's say you are poor at marketing (of course you aren't, or are you?) and spend $10,000 on marketing to get 100 new customers. Each customer spends an average of $50, and you spend $30 to make each product.

Let's also assume you have a great team that maintains a customer retention rate of 75% per year. That means your customers have an LTV of:

Customer contribution margin = $50 – $30 = $20

LTV = $20 / (1 – 75%) = $80

CAC = $10,000 / 1,000 = $10

LTV/CAC ratio = $80 / $10 = 8x

If you lost some members of your team (you insisted they come back to the office after the pandemic) and your customer retention rate dropped to 50% per year, the LTV of your customers is:

Customer contribution margin = $50 – $30 = $20

LTV = $20 / (1 – 50%) = $40

CAC = $10,000 / 1,000 = $10

LTV/CAC ratio = $40 / $10 = 4x

THAT is why retention is important. The more customers you retain, the more valuable they are to your business.

If you manage to increase retention by as little as 5%, your profitability can increase by a whole 75%! Amazing, right?

It also goes without saying – but we'll say it anyway – that retention improves ROI. You don't have to spend on marketing every time to sell your product. Imagine the savings!

It also increases sales! 61% of SMBs report that more than half of their revenue comes from repeat customers, who spend 67% more than new customers.

At this point, nothing more needs to be said on the matter. We are all reading the same page that says: Retention=Good. Acquisition=Not as good. Now that we have agreed on that, let's look into how we can increase retention.

Top 6 Tactical Strategies to Increase Retention

1. Provide Excellent Customer Service

It doesn't matter how good your products are; if your customers need you to resolve an issue and you fall short, they won't buy it from you again. We have all seen it happen all too many times.

The only way they can come back after a poor service is if you are a monopoly and they are desperate, or you are selling toilet paper at the beginning of a pandemic.

And there is no shortage of studies on the matter. Here are some of their results:

• 52% of consumers say they have made an additional purchase from a company after a positive customer service experience.

• 89% of consumers have switched to doing business with a competitor following a poor customer experience.

• When asking consumers what impacts their level of trust with a company, offering excellent customer service ranked number one.

That is why you should do everything in your power to improve the quality of your customer service. It is a very effective way of making your customers loyal to your brand.

And its not just about having a knowledgeable and polite customer team, uh-uh. They need to be available whenever and however your customers need them.

Here is how you can improve your team's availability.

Omni-channel support

66% of customers use at least 3 devices to reach support teams. A whole 3 devices! And that is no accounting for the number of channels used on each device. To make it convenient for them, research which channels they mostly use, then train your team to use them.

Provide 24/7 support

Around 80% of customers expect you to respond in real-time when they reach out. They expect a response to their requests immediately.

It sucks, but they have the reins nowadays so what are we supposed to do but jump when they say jump.

But you don't have to break the bank to invest in a team that constantly monitors the various communication channels. You have the option of a chatbot. In fact, people using live chat on your website are 4.5 times more worth than those who don't.

2. Offer a Personalized Customer Experience

A business-customer relationship is akin to a marriage (bear with me). How you, as a business or spouse, makes the customer or your spouse feel (bear with me) determines how they view you against the competition.

Do they feel like you understand them? Are you taking care of their unique needs every step of their journey? All their needs?

63% of consumers expect businesses to know their unique needs and expectations.

See this is what we mean when we preach you need to focus on a specific target audience. You can't know all the needs and expectations of the general public; it's impossible. But if you focus on a specific target, easy peasy.

To deliver a more personalized experience, you first need to create a buyer profile, then design all your marketing and content to speak directly to that profile.

And seeing how 80% of customers are willing to pay more for a better experience, you can use this as an opportunity to charge more (*insert evil smile*).

3. Collect Feedback

Remember how we likened the business-customer relationship to a marriage? Well, here is another similarity.

Your customers need to be satisfied. It is the only way for your business to retain them. But how can you know whether you have fully satisfied them without asking?

Communication is key to every relationship.

What do they think about you? How likely are they to recommend you to others? What do they like or dislike about your product?

There are several benefits of getting their feedback. Some of them include:

• You understand where your strategy falls short and improve it.

• When they feel their feedback is valued, they are likely to stick with you.

• By collecting feedback from one-time buyers, you learn what prevents your business from retaining them then improve it.

Customer satisfaction surveys such as NPS and CSAT can help you collect customer feedback.

4. Start Loyalty and Referral Programs

A referral program is a program that rewards your customers for recommending you to others. If you don't have one yet, if for no other reason, create it just because over 90% of companies have some form of a customer loyalty program.

If everyone is doing it, then there definitely is something to it.

Additionally, 84% of customers would stick around for a loyalty program. You know what that means?

It means that a loyalty program is one of the most effective ways of improving customer retention.

Although it might be costly at the beginning, the costs are nothing compared to the lifetime value of referred customers. They have a 37% higher retention rate and 18% lower churn. 81% of customers are also likely to engage with your brand if you have a referral program.

5. Retarget First-Time Customers

When your customers buy for the first time, and you don't get a chance to show them how much you value them, they won't come back. Not consciously at least.

You have to go out there and get them. Show them what initiatives and programs you have in place to benefit them. When you convince them that you value them, they will be encouraged to return over and over.

An effective way of encouraging them to come back is to use Paid Ads to highlight the perks of your loyalty program. Do they know they can accrue points and use them to make purchases? Do they know how they will be rewarded if they recommend you to others? Do they know how subscriptions will benefit them?

As long as you have enticing perks, you will have them running back to your business bringing their friends and colleagues. It has happened to me a few times and I bet it has for you too, hasn't it?

Your job is to let them know what is in it for them, then they do whatever they want with that information.

6. Direct Mail

I know what has gone through your mind when you have seen direct mail in this list. "With all the available technology, why would anyone want to send direct mail instead of a simple and way more convenient email?"

There are quite a few answers to that so I will just list some of them:

People prefer direct mail to email in all industries.

• Up to 90% of direct mail gets opened, compared to only 20-30% of emails.

• Not everyone has a smartphone or computer to access their mail.

• Most of us just read the "primary" emails and ignore the "social", "promotions", and "updates".

• Direct mail recipients purchased 28% more items and spent 28% more money than people who didn't get that piece of direct mail.

• If you are marked as spam, they will never receive your email.

These are just some of the areas that emails pale in comparison to direct mail. So, it doesn't matter how widespread digital channels become. Direct mail is still a stronghold.

Additionally, the fact that you go through the trouble of handwriting and sending it makes the recipient feel more special and valued, and they are likely to reciprocate and remain loyal to you.


You already sunk costs on acquiring a new customer; you can't recover them. So, you might as well make full use of the costs and keep them coming back for as long as possible.

The above tips should help you start or boost a customer retention campaign to make a huge difference on your bottom line.

But your customers' inboxes and feeds are drowning in offers that get ignored or deleted.

That is why you should cut through the digital clutter and use the more effective and personal direct mail. PostPilot makes it easy for you to send delightfully personalized cards as easily as email.

You only need to design your own card with our templates and drag & drop tool or utilize our complimentary custom design service. It will be in your recipients' hands in 4-6 days. We even handwrite cards with real pens and ink for a more personalized experience. Keep customers coming back using PostPilot by getting a free demo today.

PostPilot makes it a cinch to send personalized, profit-generating postcards.

acquisition & retention

Send one-off or triggered campaigns to customers & prospects. Target email leads with MailMatch™.

It’s like Klaviyo for direct mail. The results are absolutely insane.

Ash Melwani, CMO

Fight back against iOS updates, jacked-up CPCs & spam folders

Deliver your message to all of your customers — for less than the cost of a click.

PostPilot is our new weapon against sinking email engagement and rising PPC costs. The results and ROI have been outstanding. It’s now one of our core marketing channels to increase acquisition & LTV.

Leah Keith, GM

Done for you

From design & strategy to stamp-licking, our ecom experts help you every step of the way.

The team is so knowledgeable and beyond helpful. I’m blown away by their communication, detail, and attentiveness and always feel like they have our best interest in mind. Definitely worth a try.

Holly Davies, Marketing Director

Ready to increase your revenue?

Try it for free
Shopify Reviews

Join thousands of ecommerce brands using PostPilot to keep customers coming back again (and again).

No contracts. No commitment.