Brian Cliette

Mastering Shopify Analytics: A Guide on Tracking Customer Retention Rate

If you’re like me, you’re always on the hunt for ways to improve your online business. One key metric you should be tracking is your customer retention rate on Shopify. It’s a powerful tool that can provide valuable insights into how well you’re doing at keeping your customers coming back.

Shopify Analytics is a robust platform that can help you track this rate, but it can be a bit tricky if you’re not familiar with it. It’s not as simple as just logging in and checking a box. But don’t worry, I’m here to guide you through the process.

Why is tracking customer retention rate important?

Customer retention rate is a metric that fuels any online business. While getting new customers is crucial, it’s the return customers that bring in the majority of the revenue. This rule holds true for e-commerce stores as well. As per a report by Bain & Company, increasing customer retention rates by 5% can increase profits by 25% to 95%.

So, why does this happen?

It’s simple really. Repeat customers tend to buy more from a company over time thus leading to higher lifetime value. They are also more likely to become brand advocates and refer others to your store. And they do this while costing less to service since they are already familiar with how your business works.

Let me break it down further for you:

  • Lower Cost of Acquisition: Once a customer has been acquired, it costs less to get them to make another purchase compared to attracting a new customer.
  • Higher Value Transactions: Existing customers are more likely to trust your products and make bigger purchases.
  • Improved Reputation: Satisfied, repeat customers often refer others to your business, boosting your reputation and potentially bringing in new customers.

Understanding trends in your customer retention rate gives you a clear view of whether these benefits are being realized. This is where Shopify Analytics comes into play as a valuable tool but often, it may seem daunting. So, we’ll talk about how to navigate this tool for tracking customer retention rate in the next section.

Understanding Shopify Analytics

Diving headfirst into the world of e-commerce can feel overwhelming. With so many components to monitor from website traffic to conversion rates, getting the hang of everything can appear daunting. But enable your business to soar, you don’t need to become an overnight analytics expert. That’s where Shopify Analytics steps in.

Shopify Analytics is a powerhouse of tools that help online shop owners understand and evaluate the performance of their store. The key is, it’s designed to be intuitive, making it accessible for users of all levels and experience. Be it sales, customers, or behavior reports, Shopify Analytics has got you covered.

Let’s break this down, so you’ll understand exactly why it’s such a vital tool. With Shopify Analytics, you can:

  • Monitor your online store’s performance: By looking at vital indicators, you can see how well your store is performing in real-time.
  • Gain insights into your customers: Discover who’s buying from your store, and what they’re buying. You’ll get insight into customer behavior trends, letting you adapt your store accordingly.
  • Make data-driven decisions: Forget guessing. Base your strategies on the hard data Shopify Analytics offers. This nudges progress in the right direction, leading to growth and increased profits.

Now we’ve grasped the basics of Shopify Analytics, the next step is understanding how to utilize it in tracking your customer retention rate. Stick around as we delve into how Shopify Analytics becomes your secret weapon to boost repeat customers and in-turn, skyrocket profits.

Setting up Shopify Analytics

The first step in tracking customer retention rate is setting up Shopify Analytics. This tool is robust, user-friendly, and exceptionally valuable for gaining insights about your customers. I’ll guide you through setting it up to help ensure you can get the most out of it.

Creating an Account
If you don’t already have a Shopify account, you’ll need to open one. Navigate to the Shopify website and sign up for a free 14-day trial—it’s your window into the world of online retailing. Once you’ve signed up, you’ll be able to venture into the Shopify dashboard, where most monitoring and controlling tasks happen.

Configuring Your Store
Next, configure your online store. On the left side of the dashboard, you’ll find settings that let you add products, manage payments, and set up shipping. This setup process isn’t just about product inventory. It’s also about integrating Shopify Analytics to make more sense of your sales data.

Shopify Analytics Activation
To activate Shopify Analytics, go to “Store Analytics” on the left side of the dashboard, then select “Reports”. This comprehensive analytics dashboard is your one-stop-shop for all sales data. Plus, built-in data visualization tools can help you see trends, patterns, and growth potential.

And there you have it! You’re now in possession of a potent eCommerce tool—Shopify Analytics. With your account set up and analytics activated, you’re poised to start tracking your customer retention rates.

Finding the customer retention rate metric in Shopify Analytics

So you’ve configured your online store and now you’re ready to dive into the data. Tracking your customer retention rate is simpler than you might think. There’s no need to worry – let me guide you through the process with ease.

First off, we need to open the Shopify Analytics dashboard. To find this, head to Shopify’s main dashboard. Then, select the ‘Analytics’ option in the sidebar menu located on the left-hand side. Click on this and you’ll be redirected to your analytics dashboard. This dashboard is a goldmine of insights waiting to be tapped into.

As you can see, the dashboard is quite comprehensive. However, to make this process smoother for you, let’s focus on two areas: Reports and Live View. The ‘Reports’ section gives you access to various standard and custom reports. ‘Live View’, as the name suggests, lets you see real-time data about your store.

For our purpose, we will focus on the “Sales over Time” report under the Reports section. This report provides an in-depth analysis of your sales – which is what we’ll use to track the customer retention rate. To access it, simply click on ‘Reports’ and select ‘Sales over Time’.

You’re probably wondering “But where’s the customer retention rate metric?” Well, Shopify doesn’t directly display your customer retention rate – not to worry, it’s easy to derive this metric from the available data. Check your total number of customers, number of returning customers, and period over which the data is collected.

Customers who made more than one purchase during the selected timeframe are your returning customers. To find out your retention rate, you calculate it using a simple formula:

(number of returning customers / total number of customers) x 100

This will give you the customer retention rate for the selected period.

By now, I hope you can see the power of Shopify Analytics. Though it may seem overwhelming at first, once you learn to navigate it, you’ll start leveraging your customer data in ways you never thought possible.

Analyzing and interpreting customer retention rate data

It’s safe to say we’re in the raw data territory now, which may be a bit overwhelming at first. However, it’s with this raw data that we’re able to identify how well we’re retaining our customers.

Let’s dig a bit deeper into this data.

The customer retention rate can be represented as either a percentage or a ratio. It’s a measure of the percentage of customers who stay with your store over time. To calculate this, we use the number of customers at the end of a period minus the number of new customers during that period, divided by the number of customers at the start of that period, all times 100.

That can be represented as follows:

Number of customers at the end of a period
– Amount of new customers during that period /
Number of customers at the start of the period x
100 =
Customer Retention Rate

What’s important to understand here is that a higher percentage implies a better retention rate. In other words, a high customer retention rate means your clients are sticking with you. They appreciate your efforts and show their loyalty through repeat purchases.

This is why we place such a high emphasis on customer retention rates. It’s not just about making that initial sale to a customer, it’s about forming long-lasting relationships that ensure they keep coming back for more. It’s about building trust, and there’s no measure quite as telling as the customer retention rate.

In essence, lower numbers mean there’s work to be done. It could be that the shopping experience isn’t up to par, or perhaps our marketing strategies need a revamp. On the other hand, high values highlight areas of success.

Remember, there’s always room for improvement. Let’s keep evolving, striving for perfection, and making every Shopify interaction a memorable one.


I’ve shown you how to harness the power of Shopify Analytics to track your customer retention rate. It’s a simple yet crucial metric that can transform your business. Remember, it’s not just about making a sale. It’s about fostering relationships and creating memorable experiences that keep customers coming back. The formula I’ve shared is your key to unlocking this potential. Through continuous improvement and a commitment to your customers, you’ll see your retention rate climb. And as it does, so too will your business’s success. So don’t wait. Start tracking your customer retention rate today and take your Shopify business to new heights.

Frequently Asked Questions

What is the purpose of analyzing customer retention rate data?

The purpose is to understand how many customers continue to do business with you over time. This helps in building long-lasting relationships with customers, which is critical for the overall success of your business.

What is the importance of a high retention rate?

A high retention rate signifies that customers are satisfied with your products or services. This leads to increased customer loyalty, repeat business, and even more referrals – all of which drive revenue growth.

How do you calculate the customer retention rate?

The customer retention rate can be calculated using a specific formula presented in the article. It involves comparing the number of customers at the start and end of a given period, and the number of new customers acquired during that period.

How should Shopify interactions be strategically utilized?

Shopify interactions should be used to enhance customer experience. This can be achieved by ensuring every interaction is memorable, ultimately leading to continuous improvement and higher customer retention rates.

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About me

My name is Brian Cliette; I help brands and entrepreneurs find sustainable paths to sales growth on the social internet.

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