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Improving customer retention for your online store


Customer retention is a key part of growing your business and scaling your marketing spend. Having customers coming back to purchase a second and additional times drives your Advertising spending down in proportion to your sales volume. Outside of your digital marketing strategy that covers targeting your audiences with advertisements, a customer retention strategy should be a priority to keep the audience engaged and in doing so, have several tools to make your brand top of mind when it comes to purchasing what they need.

Customer retention defined

Brand loyalty and repeat business are other names for customer retention. When it comes to customers demonstrating their brand loyalty, they advocate and are in tune with new articles, engage with the branding and participate in loyalty programs - since they come back for additional purchases. The frequency (over a period of time) and average basket value are measures of their loyalty, and when an enticement is in play - they usually engage and buy some more.

Customer satisfaction is a key component when it comes to customer retention. Everything that is digitally seen and engaged with such as social media posts, live chat, and case studies all the way to customer support will make the brand loyal customer recommend by word of mouth to their friends and family their experience, spreading the brand and their positive experiences.

Customer retention is not to be confused with Customer Lifetime Value (CLV) which is the total revenue expected by a client over the lifetime of being a client. Additionally, the opposite of customer retention is customer churn, which is the rate of customers leaving the brand. Satisfied customers have varying retention, and different levels of intent when it comes to valuing your brand, and that's why customer surveys are sent out to evaluate how your business does when it comes to performing their services and selling the right product and services to the audience.

How to measure customer retention rate with your online store

There are 3 variables that you must obtain to calculate your retention rate with your online store.

1 - Total number of customers when you start your measuring = (S)

2 - Total number at the end of the measuring period = (E)

3 - The number of new customers between the two periods = (N)

Customer Retention Rate (in %) = [(E - N) / S] x 100

If every new customer stays as a customer, then you have 100% customer retention rate.

If you started with 5000 customers, and you gained 2000, but you ended up with 5500 customers, then the customer retention would be [(5500 - 2000) / 5000] x 100 = 70% retention rate.

Key ways to improve Customer retention in your online store

Increasing customer retention requires an intimate knowledge of how your customers interact and engage with your business process and brand. Customer success is measured differently between different types of businesses, and the same with customer acquisition, therefore understanding how to go about improved customer satisfaction requires the knowledge base of the customer journey throughout.

1 - Have a customer referral program: Turning your customers to be ambassadors and being able to reward them for getting additional customers is a key incentive to augment your audience all the while having your customer engaged with your brand.

2 - Reward customers for "liking" or signing up to your social media pages on various platforms. This allows customers to share posts, as well as comment and engage with new collections and products.

3 - Have customer incentives to write reviews on the products that they have purchased. These incentives could be in the form of points as well as discount codes.

4 - Have a scaling engagement reward, giving higher engagement early access to new collections, or preferable shipping options. Sometimes called a VIP program, improving the engagement and customer relationship and recognizing customer loyalty is important.

5 - Submission of pictures of your purchases that shows your engagement with the product for others to see and review is worth a thousand words. With each picture submitted, customers can see how they are applied and used, giving them a sense of lifestyle.


When retaining customers well, your customer base grows and scales your advertising budget over a larger base. When the customer experience is well underway to be positive for every delivery, then your business is geared up for growing its customer loyalty. With the right programs in place, the engagement has incentives with rewards. In eCommerce terms, they are usually in the shape of Apps, located in the likes of the Shopify App store, or whatever eCommerce store type you have in place. If you are challenged in selecting the right App for your store's retention, feel free to reach out to us at

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