Solution · Returning customers A new customer costs you money. A returning customer makes you money.

Customer retention is an online store’s ability to get customers to buy again. You measure it with the repeat purchase rate and with customer value over the whole relationship, the customer lifetime value (CLV).

According to Harvard Business Review, acquiring a new customer costs 5 to 25 times as much as retaining an existing one. For online stores, that’s mainly due to ad costs: you have to buy every new customer through Google or Meta, while you reach an existing customer for free through your own channels, such as an app or email.

Customer lifetime value is the total revenue a customer brings in over the whole relationship with your online store. You calculate it simply as average order value × number of orders per year × number of years a customer stays. Improving retention mainly increases the number of orders and the length of the relationship.

Start with the repeat purchase rate: the number of customers with two or more orders, divided by all customers in the same period, for example twelve months. Also look at the time between the first and second order, and at revenue per customer over a year.

That depends heavily on your sector. A store selling consumables sees much higher figures than a furniture store. So compare mainly with your own figures from last year, and measure the effect of each change with a control group.

They complement each other. A push notification via your own shopping app appears straight on the home screen, at no cost per message. Email works well for longer content. Many online stores use the app for offers and key moments, and email for inspiration.

The four most common ways are: your own channel such as a shopping app with push notifications, personal recommendations based on earlier purchases, perks for loyal customers, and well-timed messages after the first purchase. Start at the point where most customers currently drop off; often that’s between the first and second order.

That depends on where customers drop off now. A large range calls for personalisation, many loyal customers for your own channel, and discount seekers for your own discount code page. In a 30-minute call we work that out together.

Nothing. Online stores pay us no advisory fees, not even when they go on to choose a technology. Growth Sharks has commercial agreements with the technology companies themselves. You only pay for the technology you choose, at that partner’s prices.