Boost AOV and Customer Retention With These Proven eCommerce Strategies

Digital advertising costs have skyrocketed in the past few years, causing a steep and gradual increase in customer acquisition costs.

Did you know that online merchants are spending more money acquiring new customers than what they’re making back from each new sale? 

On average, brands are losing around $29 per sale for each newly acquired customer.

To offset these rising customer acquisition costs, online store merchants are using Shopify apps such as CartHook and UpOrder to boost average order values (AOV) and retain more customers. 

E-commerce customer retention makes it easier to sell to existing customers who will spend more money than first-time buyers.

How is average order value (AOV) related to customer retention?

The average order value (AOV) is an ecommerce metric that calculates the average dollar amount spent per transaction by taking the number of orders and dividing it by the sales revenue generated. 

For example, a store that’s sold $1,000 worth of items across 20 transactions has an AOV of $50.

Every Shopify merchant is looking for ways to improve their AOV, whether it’s adding more upsells on their checkout page, including more bundled products, or getting customers to return to make a repeat purchase.

Why customer retention improves AOV

Repeat customers spend 67% more than first-time buyers. Not only that, but each time they continue shopping at your store, their order values will continue to increase.

Increasing your customer retention rates by just 5% has been shown to improve sales profits anywhere from 25% to 95%

Or put it this way, around 80% of your revenue will be driven by just 20% of your customers! This is Pareto’s Principle, also known as the 80/20 rule.

4 ecommerce customer retention strategies to boost AOV, customer loyalty, and boost customer lifetime value (LTV)

When shopping at your store for the first time, many shoppers will be a bit more cautious and spend less money than your loyal customers. 

Usually, your first-time customer will just purchase maybe one or two products as a test to gauge whether they like your store’s products and customer experience.

Once your customer has placed their first purchase, you’ll need to find meaningful ways for connecting and retaining customers to bring them back to make a repeat purchase.

Use these customer retention tactics to hold onto customers post-purchase and bring them back to extend their lifetime value (LTV).

1. One-click post-purchase offers — targeted upsells, cross sells, and downsells

If you want to boost AOV and turn your customer into a repeat customer immediately, then build a one-click post-purchase offer.

A one-click post-purchase offer, or funnel, is a targeted product recommendation shown to your customers after the final checkout page, but right before the order confirmation page.

Essentially, you can show your customer one to two more product recommendations that they can either “accept” or “decline” with just one click to add more items to their shopping cart.

Using the app CartHook, Shopify merchants can boost AOV by showing targeted product upsells that are triggered by what the customer has in their shopping cart. 

Because the offer is shown after checkout, there’s zero risk of cart abandonment, and a 15% chance of conversion, easily boosting your AOV and turning your customer into a repeat buyer immediately.

2. Offer subscriptions to maximize customer lifetime value

Subscription services are on the rise, growing in popularity by 6 times in the past 9 years.

Subscriptions drive and extend lifetime value turning an initial buyer into a monthly or weekly repeat buyer.

Consumables, such as health and beauty products are the perfect products to offer subscriptions for, as customers need to re-order these products every month.

Using CartHook, merchants can not only offer product recommendations but also upsell customers on signing up for subscriptions!

3. Stay in touch after the purchase with post-purchase emails

The problem with most promotional emails is that they never get opened. 

But do you know what emails get opened? Transactional emails, such as order confirmations and shipping confirmations.

Most customers will instinctively check their email after placing an order to make sure their order went through correctly. These emails are the perfect place to include up to three personalized product recommendations based on their shopping history.

Using Pantastic’s app UpOrder, Shopify merchants can design and optimize their post-purchase emails to include personalized product recommendations and cross sells that will drive repeat sales.

When using UpOrder, many Shopify merchants saw a 14% increase in revenue through their email channels alone!

4. Reward loyal customers with personalized, limited-use discounts

60% of new customers become repeat customers because of a personalized customer experience. 

Reward your most loyal existing customers by offering them special, limited-use discounts in their post-purchase transactional emails to drive traffic back to your store’s website.

Using UpOrder’s post-purchase email app, you can create discount codes using your customer’s first name, e.g. “AMBER25OFF.” 

By using your customer’s name in the promo code, you’re offering a more personalized experience, ensuring they’re more likely to use the promo code to make their next purchase.

Try CartHook and UpOrder to boost AOV and improve customer retention

CartHook and UpOrder are Pantastic’s Shopify apps that help merchants boost AOV and retain more loyal customers.

CartHook is a one-click post-purchase upsell app that places targeted upsells at the end of the checkout page, boosting sales revenue by 10%.

UpOrder is an email template builder that drives repeat purchases through targeted product recommendations in transactional post-purchase emails.

Download your free trials of CartHook and UpOrder today and watch your AOV and customer retention increase.

Want to see more content like this?

Thanks, you're all signed up!
Oops! Something went wrong while submitting the form.

Join the world's fastest-growing indie brands.

Request a Demo