Customer retention in Shopify is tough

Customer retention can be a tricky problem with Shopify stores.

Most stores don't have subscriptions or subscriptions aren't their main transaction type. That means each order has the potential to be the last order from that customer and you won't know until it's too late.

You never really know if you've retained a customer or not until they order again. Even then, the cycle just starts over again. e.g. you won't know if you're retained them again after that order until they order again.

One-time orders have no commitment for the customer. Once they order, they aren't obligated to order from you again.

That puts all the weight on you as the store owner to convince them to come back and buy again.

This is also why "customer loyalty" is a thorny phrase. A customer who orders only once isn't disloyal. The store didn't earn their second order. (Dis)loyalty isn't the customer's responsibility, it's the store's.

Since it's near impossible to tell if you've retained a customer, you can just ignore all this retention and loyalty stuff right?

Wrong.

Individual customers can't be measured. Groups of customers can.

Using a customer segmenting analysis like RFM can let you know if some customers are acting differently from the rest of the groups. That could be they haven't bought as often (low Recency in RFM) or have recently bought (high Recency). There's your retention measurement right there.

There's even more advanced analysis options too. Repeat Customer Insights will look at the ordering timelines to find when and who should be placing their second orders soon. If they take too long, there's your retention problem. This sort of approach lets you be much more proactive with customers than just waiting for them to order.

Retention is one of the hard problems with ecommerce and really, with most businesses. Once you can start to measure it, then you can work on solving it.

Eric Davis