6 Shopify Customer Retention Strategies to Increase CLV

This post highlights key strategies for Shopify businesses to maximize CLV, including retention, upselling, and using tools like Egnition’s Out of Stock Police.

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By Jameela Ghann
Photo of Danell Theron
Edited by Danéll Theron

Updated January 13, 2025.

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Customer retention is critical for Shopify stores because retaining an existing customer is far more cost-effective in terms of both time and money than acquiring a new one. Studies from Harvard Business Review and Gitnux show that increasing retention by just 5% can boost profits between 25% and 95%. That’s because loyal customers tend to spend more over time, make repeat purchases, and recommend your store to others, directly increasing customer lifetime value (CLV).

» Boost your store’s customer retention with Shopify automation

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Meet the Expert

Jameela Ghann is a seasoned online store owner with over a decade of eCommerce experience. She's also the marketing manager for Fera Product Reviews.




How Shopify Businesses Tackle Customer Retention Challenges

Creating experiences and programs that improve customer retention is paramount for Shopify businesses.

Shopify merchants face unique challenges:

  • Reliance on third-party apps: Managing customer retention strategies often creates headaches for staff and shoppers.
  • Building loyalty programs: Unlike Amazon, Shopify merchants must build their audience and loyalty programs from scratch.
  • Ensuring consistency: Success depends on integrating apps, syncing data, and creating consistent, high-quality customer interactions.

Did you know? 79% of consumers said they purchased from the brand more frequently because they participated in a free or paid loyalty program and companies that invest in customer experience see more than 50% higher revenue.

» Check out these marketing incentives to retain e-commerce customers

Boost Retention and Traffic with Egnition

Learn how Egnition's automation apps can enhance customer retention and drive more traffic to your Shopify store



Infographic showcasing the six customer retention strategies for shopify


1. Loyalty Programs

Loyalty programs incentivize repeat purchases by rewarding customers with points, discounts, or exclusive perks. These programs:

  • Build emotional connections with customers.
  • Directly contribute to a higher Customer Lifetime Value (CLV).
  • Encourage referrals and repeat sales, extending overall spending.
Customers who feel valued are more likely to return and refer friends, extending their overall spending.

» Can you combine discounts? Here's how

Best Practices and Tools

  • Use apps like Smile.io to create customizable reward systems.
  • These tools integrate seamlessly with Shopify.
  • Offer robust analytics to track program success.

Example: Skincare brand Youth to the People uses a tiered loyalty program to reward repeat purchases with exclusive discounts and free samples, boosting customer engagement.

» Learn more: Do rewards lead to better retention?

Skincare brand showing Loyalty benefits



2. Unique Post-Purchase Engagement

Engaging customers after a purchase deepens emotional connections and drives repeat business. Examples include:

Shopify stores with products that require some customer education specialty food items or cookware can maximize value by helping customers get the most from their purchase.

» Here are the best ways to automate post-purchase emails in Shopify

Best Practices and Tools

  • Use Shopify’s built-in email app to simplify workflows with personalized communication or updates.
  • Automate messages with dynamic content tailored to purchase history to save time and enhance engagement.

Example: Patagonia use post-purchase emails to provide repair tips or care instructions, reducing churn and creating eco-conscious loyalty.

the instructions for how to recycle patagonia garments


» Struggling to manage multiple Shopify stores? Take a look at our guide to multiple Shopify store management



3. Gamify the Shopping Experience

Gamification adds excitement to the shopping experience by incorporating interactive elements like:

  • Spin-to-win discounts.
  • Progress bars for unlocking rewards.
  • Seasonal challenges that motivate customers to achieve goals.
Lifestyle and beauty brands thrive with gamified shopping experiences.

Best Practices and Tools

  • Use spin-to-win apps on Shopify to integrate interactive shopping experiences seamlessly.
  • Align challenges and rewards with your brand’s identity to maintain authenticity and trust, avoiding gimmicks

Example: Sephora’s Beauty Insider program sometimes uses gamification to unlock tiered rewards based on spending. Their spin to win is a popular holiday favourite.

» Read our expert tips about Shopify discount codes



4. Out-of-Stock Optimization

Proactively managing out-of-stock inventory helps:

  • Inform customers when popular items are unavailable.
  • Offer alternatives or restock notifications.

This approach builds trust and keeps customers engaged, reducing the risk of losing them to competitors.

Retailers with high-demand or limited-stock items such as seasonal apparel benefit most from proactive inventory management.

Best Practices and Tools

  • Use Egnition’s Out of Stock Police to automate visibility updates for sold-out items, ensuring they’re hidden or moved to the bottom of listings.
  • Offer options like signing up for restock alerts or suggesting similar products to reduce frustration and improve customer experience.

Did you know: Stores implementing out-of-stock optimization see a reduction in customer churn and an increase in conversions for alternative products. Metrics like cart abandonment rates often improve as customers find relevant substitutes.

out of stock police icon resized

Out of Stock Police: Organize for Better Conversions

Automatically hide or push out-of-stock items in collection

Receive low-stock alerts for efficient restocking

Keep your storefront organized to improve the shopper experience and boost conversions.



» Here are 6 strategies for out-of-stock products to boost your e-commerce store



5. Social Proof and Reviews

Displaying customer reviews:

  • Builds trust and reduces purchase hesitation.
  • Acts as social proof, assuring potential buyers of quality and reliability.
  • Encourages repeat purchases and fosters long-term loyalty by strengthening confidence in your brand.
Stores selling high-ticket items, niche products, or innovative solutions benefit most from reviews.

Best Practices and Tools

  • Use apps like Fera and Judge.me to collect and display customer reviews, including photo and video testimonials.
  • Automate post-purchase review requests to ensure a consistent stream of fresh content.
  • Manage negative reviews transparently, addressing feedback and showcasing a commitment to customer satisfaction.

Example: Glossier leverages customer reviews to validate product claims, featuring authentic photos and testimonials on its website.

Glossier reviews page



6. Exclusive Member Community

Creating exclusive communities fosters a sense of belonging and shared purpose among customers by:

  • Building emotional connections through brand mission alignment.
  • Offering unique engagement opportunities like forums, social groups, or member-only events.
Lifestyle brands targeting niche audiences benefit most from exclusive memberships.

Best Practices and Tools

  • Use tools like Circle.so to build community platforms with exclusive content, events, and discussions.
  • Assign a dedicated community manager to ensure regular engagement and content updates.
  • Incentivize participation through rewards or exclusive perks to sustain interest over time.

Example: Outdoor gear brand REI excels in fostering loyalty through its co-op membership program. Members gain access to exclusive discounts, events, and outdoor classes, reinforcing their connection to the brand’s mission.

Homepage of REI, showcasing loyalty through membership


» Need more tips? Check out these tips to make your Shopify store a better one



3 Tips to Maximize CLV

1. Allocate Your Budget Strategically

Allocate a portion of your marketing budget to retention efforts, such as loyalty programs and customer support, while directing the rest towards attracting new customers. Retaining existing customers is more cost-effective and directly boosts CLV, while new customer strategies drive continuous growth for your e-commerce store

2. Use Merchandising and Upselling Basics

Drive incremental revenue by recommending complementary products or upgrades to existing customers. Shopify apps can help showcase best sellers on collection pages or offer upsell options at checkout. Upselling strengthens relationships and increases AOV, allowing you to extract more value without significant additional costs.

3. Segment Your Customers for Hybrid Campaigns

Segment customers by loyalty or purchase frequency to create targeted campaigns. Focus on re-engaging loyal customers while also targeting lookalike audiences on social platforms. This approach ensures you maintain a healthy balance between retention and driving new customers.

» CLV is only the first step. Here are more ways to ensure your ideal customers keep coming back



Key Takeaways for Shopify Success

Balancing customer retention and engagement is key for Shopify businesses aiming to maximize CLV and profitability. By allocating budgets to retention, using upselling, and segmenting customers, merchants can boost loyalty.

Adopting loyalty programs, creating exclusive communities, and leveraging tools like Egnition’s Out of Stock Police further enhance the experience. Focusing on both retaining existing customers and nurturing new relationships drives sustainable growth and success.

» Explore the EGNITION Shopify App Store for automation tools that can boost retention and increase CLV

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