Rules of thumb to measure your Shopify store performance

There are a lot of metrics Repeat Customer Insights calculates for you but it can become confusing to know if they are improving. Is increasing up good or bad?

The app will automatically highlight problem areas but here's a few rules of thumb you can use.

Average Latency

You want your Average Latency to decrease. Since it measures the number of days in-between orders, a lower number means customers are ordering sooner which is what you want.

Average Lifetime Value (LTV)

Your customer's Average Lifetime Value (LTV) should increase over-time as customers spend more money at your store over their lifetime. Ideally it'll increase faster than inflation.

Average Order Value (AOV)

Average Order Value should increase if you're targeting the same order sizes.

Sometimes you'll make a strategic decision to go after smaller, more frequent orders. In that case your AOV should decrease while you change that strategy and then hold steady and slowly increase.

(Why go after smaller, more frequent orders? It can help build buying habits for your customers which could end up making your store's product sticker. This is a huge strategy that I can't write an aside on but can work really well)

Average Orders per Customer

This should increase over-time as customers become more loyal and place more orders.

Average Orders per Month

This should increase over-time. Can vary as your store goes through seasonal patterns but if you look at a year-based or an all-time based version, it should be increasing.

Repeat Purchase Rate (RPR)

Ideally your Repeat Purchase Rate should increase but it can be difficult to shift it much. But even a 5% increase can have a dramatic boost to your profit.

Repeat Sales Rate

Your Repeat Sales Rate will probably be pretty stable during normal business based on your regular mix of new customers vs repeat customers.

It can swing a lot during promotions, after launching new products, or when exploring new sales channels. If it drops too much lower than usual, that can be a sign of attracting more new customers or losing repeat customers.

Returning Customer Rate

Similar to Repeat Purchase Rate, this should increase but it can be difficult for major shifts.

A lot of these metrics and analysis come with the usual "It Depends" caveat. As you go through changes in your store you might be willing to let some metrics "go bad" because you're focused on something else.

That's okay as long as you intended to do that.

Eric Davis