how to find ltv in shopify

hey everyone in this video I just want,to talk quickly about lifetime value and,show you a great app that I'm using,right now to give you real data on what,your actual lifetime value is so if,you're a business owner or you're a,marketer it's really important that you,understand,when are my customers coming back and,buying from me again in the future and,is that actually happening and this is,going to tell you that so this is a lot,better than guesswork most people I talk,to guess at what their repeat order rate,is and they guess what their lifetime,value is and but the other people don't,have a clue what it is,and if they do want to find out they,have to use a spreadsheet,and it's very complicated it takes a lot,of time,this is the best app I've found so far,that will give you everything you need,straight away,so I'm looking at the main lifetime,value report here and this is,divided into cohorts so you'll find a,lot of information throughout the app,these videos are really helpful,but just really quickly what this is,let's say somebody places an order in,April their first order that's their,average order value 35.,and it says here the returning,rate is 19 which is pretty good and this,is the customer requisition cost here,you fill all of this in with your own,data so you can add your your margins,you can add your expenses and so on,and it's telling me that basically by,the by the sixth month,the cohort has now accumulated 46.,pounds in average sales so in other,words it's 109 it's 129 of the first,purchase value,so that's how things played out for the,six months from April to now basically,we can look at any window we like we can,change that here for this time period,and then may we can look at okay how is,that may cohort performing,so so far we can say well it's it's a,bit below the average well it's a bit,below April sorry so it's 15 repeat,order value first of all the value is a,little bit less,second was less and it's generally,lagging behind,and then we can just look at the other,months and we can look at how do they,compare to the average to our Baseline,so what you want to be doing is thinking,about first of all,measures to incentivize a higher average,order value on the first order,and second of all looking at your,retention strategies,so if I put in place some,mechanisms to raise that aov,then I want to journal that and I want,to make a note of when that was and then,I can look in here and I can see,obviously I can look at other tools as,well but I can look in here and see okay,iov has now increased this is this is,working,but secondly I need retention as well so,it's no good raising the aov and hoping,we're going to get an LTV from that we,need to have a intentional and,deliberate way of bringing people back,to the store,so,that would be an email sequence you know,and this could be going out over that,six months period,but this tool gives you a lot more,insights on how to make this email,sequence a lot more effective and how to,make the first order not only the best,in terms of aov but the best in terms of,retention as well because not all,products are created equal as far as,retention goes so I'll give you an,example so with the brand I'm looking at,right here,what was happening was,they were running performance Max,campaign on Google ads,this was biasing the spend towards a,high frequency but highly bought product,in high frequency but it wasn't a good,product from the point of view of the,aov was quite poor,and that it was like only a 10 pound,product and the average order value was,around 20.,and also the lifetime value,I found out was poor and I only found,that out by using lifetime me because,there's a lot of products in the store,and they can't possibly know the,lifetime value of all these different,products,and I found that the this product which,was getting pushed the most we'll just,call this product a,was 50 less likely to result in future,purchases,and I found that out through lifetime me,I found another product we'll call it,product X,which was twice as good as that product,and it had a higher aov,so it ticks all the boxes High OV means,I can spend more on my,ads to acquire that customer,please I can go down to a lower return,on ad spend if I if I want to and pay,more to acquire but also I can do that,with sure knowledge that the people who,buy that product are the most likely,people to come back again and again and,again so different products have a,different draw for people but what,happens here is we can then,go in with product X we can scrap this,if necessary and we can push more spend,to product X,and then using lifetime meat we can see,well what other things do people who buy,product X buy and when do they buy them,what is this six month time frame look,like,and then you can get your email to any,other Outreach you're doing you can,reflect that buying,cycle or that behavior,in your emails,so you wouldn't,necessarily encourage people to buy,something sooner let's say they buy,products,uh Y in around like three months period,three month point there might be a very,particular reason why that happens maybe,they're not finished using product,product X yet,we want we won't want to be,too overtly selling if this doesn't make,sense because that can actually harm,your email list,but we want to act in harmony with the,normal behavior but just encourage that,behavior to happen because without doing,that people could go off and buy this,this product why from a different,business for example,so we want to incentivize the existing,behavior and we want to amplify it by,being very intentional and deliberate,with email,so all of this I got through life Timely,I'll just quickly show you the other,aspects to this so LTV drivers this is,how I began to,find a product which was going to be the,best to put my husband behind so here I,found two products,just very quickly in this list,these are high LTV driving products and,they also have a high average order,value I could just simply go and look at,the product in Shopify or I can get more,data from it within lifetime me to see,what the average order value is down,here I can also look for other products,so I can scroll down,and I can look at the LTV and the number,of orders,so I'm looking for products which have a,lot of customers and they have a healthy,LTV,and I'm looking for products which have,a higher numb and a higher than average,number of repeat orders,what I could do is I can take this one,and I could paste that in here,and get the exact data for that,particular product,I can also look at that bad product so,that 10 pound product that was costing a,lot to Market and I put that in here and,I realized that that was really poor and,that was not bringing in future orders,so really there was no sense in putting,money behind it because,the business owner thought well maybe,this product is bringing new blood into,the business and these people will buy,in the future and no it wasn't so we,quickly got rid of that myth and just,imagine how much that's going to now,save,on a product which had a very poor rise,and was essentially losing money the,other thing you can do is look at,customer behavior and you can look at,product journey and this is linking into,what I said about mirroring that Journey,with your email sequence is you can,simply put your product in here,and it will show you,what the next product is they would buy,so in this instance here it's this,particular product is the vast majority,of the second order,I can then look at the second order time,frame like when does that happen I can,look at the repurchase rate repurchase,rate break down time between orders,essentially and I can start to then,mirror that here,so anyone who bought product X can go,into this email sequence,they can be sold product why they could,even have that at a discount if we,figure that that's going to,stop those people going elsewhere to buy,it,and then we can just mirror the other,parts of the journey obviously not all,selling lots of value here as well and,that's why we need to understand our,customer who buys product X in the first,place what's their life like what,problems they're experiencing what,desires do they have and just really be,there for that person and be that go-to,brand for that person that goes into the,world of email,anyway that concludes this quick video,tour I hope you see how powerful this is,but please do get a trial of this,install it you have a I think it's a 14,day free trial I'll put the information,below and just see what it reveals and,then if I were you I would leave it,installed start letting it aggregate the,data,look at look then at your cohorts here,make changes to your marketing make,changes to your email sequence,and then observe what happens and keep,tracking it keep a journal and keep,improving and if you do that then this,tool is more than going to pay for,itself,all right I hope that's helpful speak to,you soon bye

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