Retention economics for Shopify stores

Repeat-customer numbers are meant to track people over time, but Shopify reports count profiles. When one person has two profiles, a loyal customer can look like two one-time buyers, and a regular can look like they stopped ordering.

Three common numbers all divide by a count of customers:

• Repeat purchase rate: customers with two or more orders ÷ customers with at least one.
• Orders per customer: orders ÷ customers.
• Customer lifetime value, in its simplest form: revenue ÷ customers.

Orders and revenue stay the same when you count people instead of profiles. The customer count shrinks, and split repeat buyers reappear. How duplicate customers distort your repeat purchase rate works through an example.

The same split reaches your lists. In MergeGuard’s demo store: 905 customers look like they stopped ordering → 842 really did; 63 still buy on another profile Demo store (Northsail Supply). See lapsed customer.

In this hub

• Customer lifetime value for a small Shopify store: spend to date or a forecast, and why counting people changes the figure.
• How duplicate customers distort your repeat purchase rate: the formulas, a worked example and steps to measure the gap.
• When has a customer stopped buying?: judge each customer against their own usual gap.
• Reading Shopify’s customer retention report on a small store: what the report offers and where a small store should be careful.