Onsite product reviews

You collect product reviews from customers who have ordered a certain product, which you then match to that product on the front end of your website — but don’t worry, there are some great platforms that integrate with Shopify to automate this process. These platforms send an automated email to each customer after they have placed an order, asking them to rate the product, usually out of five stars. Customers who leave reviews may also have the opportunity to leave a photo or video with their written review, and you then have the chance to moderate the review before it’s published on your website. The average number of stars out of five (if this is the scale you’re using) is then shown on the product page of each product, as well as the more detailed text, photo and video reviews.

Zappos.com has a review feature that indicates the number of reviews that customers have left for each product, along with an average star rating out of five. When you click on the stars, you’re taken to a page where you can read individual reviews on that product. You’ll also notice that Zappos uses its product reviews to inform customers about certain features of its products, such as shoes, breaking the review categories out into sections: in this case, Overall, Comfort and Style. Zappos also provides a useful key diagram, where customers can rate the sizing, such as whether the fit is small, true or large.

Zappos is not just asking customers how they feel; instead, it is using its reviews to build a product information library from its most trusted source — actual customers. Zappos wants you to review the shoes it stocks, even if the review isn’t five stars, because you can be sure it has tested the impact of reviews and the company knows that informative and positive reviews lead to an increase in conversion rates.

Zappos also incentivizes its customers to leave reviews by offering them the chance to earn Zappos VIP points. This is a strategy employed by thousands of online retailers, because giving away a small discount or special membership to gain a review, which can lead to higher conversion rates, is often a small price to pay. I talk more about customer loyalty programs in the later section ‘Why Loyalty Matters’.

Don’t send your review request email before your order has been received. Consider allowing two weeks after the order has been placed to send a review request email so you can ensure that the product has been delivered successfully.

Offsite customer reviews

Offsite reviews occur when customers decide to leave a review of your business on Google, or other third-party platforms that facilitate reviews. Now, you may think that because these reviews are being left independently, often unprompted by you, that you have no control over them — but you do. Most third-party review platforms allow businesses to claim the business name and therefore have the right of reply to reviews.

Google Reviews is an important source of business information. Claim your business name on Google so you can take charge of your offsite Google Reviews.

To set up Google Reviews, follow these steps:

1. Sign in to google.com/business, or register a new account.

   Sign up by clicking on the Manage Now button — a new page appears with the option to Find and Manage Your Business, along with a search field.

   Sign up with your business email domain, since this account will be for your online store.

2. Enter the name of your business in the search field.

   A list of business names appears — identify yours and click on it.

3. Under your business name, you’ll be asked to select a category, such as Retail. Select the appropriate category and click on Next.

   A new page appears asking if you want to add a location for customers to visit.

4. Given you’re opening an online store, select No and click on Next.
5. In the new page that appears, you’re asked if you would like to select an area that your store serves — this section is optional, and given your online store is potentially going to serve customers all over the world, I generally leave this blank and click on Next.
6. You’re then asked to select a region where your store is based — enter the country you are based in, and select Next.
7. The next page asks you to add your phone number and website, to be shown in Google. Both are optional; however, given you are opening an online store, you should enter the website address at least. Click on Next.
8. You are then asked if you want to receive updates from Google about recommendations, which is optional. Select Yes or No and click on Next.
9. The next page asks you to enter your mailing address to verify that you are the business owner. This will be private; it will not appear in Google search results. Enter your business address and then click on Next.

10. You are then taken to a page that asks you to select whether you would like to receive a postcard to that address from Google, which allows you to verify that you are the business owner.

    You can do this now, or select Verify Later (although you’ll need to verify your business before you can edit it, so it’s worthwhile doing it at this stage).

    In this case, I select Verify Later and am taken to a new page where I can select my business hours.

11. Select the days of the week, and hours of the day, that your business is open from the options provided, then click on Next.

12. Google asks if you would like to accept messages. Select Yes or No, then click on Next.

    Selecting Yes allows customers to message you through your Google listing.

    A new page appears asking you to enter a business description.

13. Enter a description of up to 750 words about your business. This will help customers find out more about what your store sells or offers. Click on Next.

14. A new page appears where you can upload photos — this is optional.

    You may like to upload photos of some of your marketing material, or of your office if you have one.

    Photos are a good way to build trust — to prove that you’re a real business with real people. Showing photos of your team, for example, has been shown to help improve your conversion rate, so I recommend uploading a photo here.

15. Skip to the next section if you don’t want to upload any photos, or select Next when you’ve finished uploading.

16. Google then offers you a $10 Ad Credit. You can accept this and use it later (see the chapters in Part 5 for more on marketing and advertising), or select Skip.

    A message appears telling you that your business profile is nearly ready.

17. Select Continue.

    You are now taken to your My Business page, where you can see a menu on the left that includes a section called Reviews.

    Any reviews left by customers will appear here, and you can click on them and reply publicly to them. You will need to verify your store before you can be notified about any reviews (refer to Step 10 for more on verifying your store).

    Review the information you’ve entered before you request verification to ensure it’s correct.

Collecting and replying to Google Reviews is a great, free way to start building trust with potential customers. I recommend that you set this up from day one. The greater the reviews, the greater the trust; the greater the trust, the greater the sales!

Selecting a review platform to use with Shopify

Shopify realizes that collecting reviews is a huge part of ecommerce, and so not only does it support third-party applications (which you can find in the Shopify App Store) that can use to request and add reviews to your store, but Shopify also has its own review platform, Product Reviews, which can be found in the Shopify App Store.

Product Reviews is free to use, and provides online retailers with a quick, cheap way to start collecting product reviews. You’ll be able to collect reviews, display them on your product pages and reply to them, but you won’t be able to pass them through to your Google Ads or paid media marketing campaigns. Product Reviews by Shopify doesn’t have all the bells and whistles of the other reviews platform, but it’s worth looking at for a quick way to get started with collecting product reviews.

Product Reviews by Shopify is a great, affordable way to get up and running with product reviews quickly. It is limited in what it offers compared to some of the other paid platforms I talk about in this section — for example, it doesn’t have the ability to accept images and video along with reviews — but it’s a nice app that’s worth checking out as you get started with product reviews.

The following list covers some of my favorite review platforms, supported by Shopify, which can help you take control of your online reputation out there in cyberspace (I consider platforms that cover both onsite reviews and offsite reviews, as well as product reviews and general business reviews):

• Yotpo: Yotpo is one of the dominant companies in the field of reviews, and handles both product reviews and general brand reviews. If you’re using Yotpo, it’s pretty much your one-stop-shop for reviews. You can get started for free with Yotpo and do cool things like send your customers automated review requests. You’ll also be able to reply to reviews and share the good ones across your social channels, while flagging negative reviews for you to follow up. You can display widgets (another form of social proof) on your website to show customers how many great reviews you have, or your overall score out of five. The next plan up charges a monthly fee, and you’ll be able to incentivize customers to leave reviews by offering discounts or special offers.

  When you’re up to 2,000 orders a month or more, you’ll be able to push your reviews through to your Google Ads, which shows a star rating in your Google Ads and so can help your click-through rates (CTRs).

• Trustpilot: Trustpilot integrates with Shopify and can be found in the Shopify App Store. Although slightly fiddlier than Yotpo to get set up on Shopify, Trustpilot is a solid platform and is one of the other major players in this space — it’s also free to get started.

  A lot of customers use Trustpilot to read reviews by other customers — it says over 529,000 businesses have been reviewed on their platform! If you search for one of your favorite brands, there’s a fair chance there will be a review page dedicated to them. This is important, because it means a lot of people are reviewing businesses without the business needing to request the review — in other words, I can go to Trustpilot and review any company I want.

  Taking ownership of your profile page on Trustpilot is a good idea, and can be done for free. This allows you to push people to leave reviews, but also to reply to them.

  Trustpilot also offers a product review component as an add-on, so you need to pay for that. Their free plan is a good way to get started, with similar features to Yotpo, and the paid-for Standard Plan allows you to use more widgets on your site, plus it gives you greater review analytics and more personalized support through its Customer Success team.

• Reviews.IO: This is another app available in the Shopify App Store, and it’s very highly rated. What I like about Reviews.IO is that it integrates with a lot of my favorite Shopify apps, including Klaviyo, Gorgias and LoyaltyLion — and, of course, Google. Reviews.IO promotes its video reviews heavily, which I think is a great tool for an online retailer.

  The one downside is that there’s no free plan available, although the value in its cheapest plan is pretty impressive, with widgets, video and text reviews, and both brand and product reviews, available.

• Okendo: Okendo is a great app available in the Shopify App Store and one that I use a lot. It’s very simple to integrate with Shopify, and its support in onboarding is excellent — you have someone to talk to on the phone if you have any issues getting started. Okendo is geared towards collecting and showcasing product reviews and has excellent features, with my favorite probably being their video reviews. After your customer has left a video or an image, you can push this user-generated content across your social channels, as well as showcasing it on the corresponding product page. You can also create ads across social channels using the user-generated content captured through Okendo (for more on user-generated content, turn to the later section ‘Utilizing User-Generated Content’).

  You can start on a free trial with Okendo, and then after 14 days move to the Essential plan for a monthly fee.

Free offsite review platforms to use

Many online review platforms are free for you to use off your site, and you can be sure your customers will use them to leave public reviews. It’s a good idea to take ownership of the profile page of your company and respond to the reviews weekly. You can also create a spreadsheet where you track the number of positive and negative reviews, and maybe select a reason for the review, as a way of collecting data about what people like or don’t like about your business or products.

These sites are a great way to build your business’s profile overall, and over time you’ll see your reviews appearing higher and higher in Google’s search results, so you’ll want to get a handle on them quickly. Above all, it’s a cheap and easy marketing and brand information tool, which is always nice when you’re starting out.

Here’s a few review sites customers will be inclined to use and that you can reply on for free:

• Sitejabber.com
• Productreview.com.au
• Trustpilot.com
• Support.google.com

If you’re using a review platform, make it engaging by providing answers and comments to feedback left and using the Q&A feature, if available — this will help build trust with prospective customers, as well as providing more information on your brand or your products being reviewed.

Understanding the lifetime value of a customer

CLTV is one of the most important metrics in ecommerce because it doesn’t just factor in the value of one order, it also forecasts the future value of your customers — which is incredibly useful in forecasting how much revenue you’ll make in the future, as well as how much to spend acquiring a customer in the first place.

You can calculate CLTV a few different ways, but the formula I like to use is the same way that Glew do it (my favorite ecommerce business intelligence platform you can check out at go.glew.io/paul-waddy): your store’s average order value (AOV) multiplied by the number of purchases in the lifetime of your average customer. You are calculating the amount of time they are a customer of your store before they lapse:

Average Order Value (AOV) × Number of Purchases a Customer Makes in Average Customer Lifetime = Customer Lifetime Value (CLTV)

Imagine you own an online store selling tennis equipment. Your average order value is $50, and the average shopper comes back twice a year, therefore spending $100 per year. The average customer stays a customer for two years, so you can find your CLTV as follows:

$50 × 2 × 2 = $200 (the CLTV)

If you’re a new business and don’t know the average lifespan of a customer yet, you can set a time period of three years for planning purposes. Look at how many times a customer on average purchases in your store over a year, then multiply that by three.

The logic behind striving to increase CLTV is that you’re able to spend more on acquiring a customer, with the knowledge of how much they will eventually spend in their lifetime with you. Understanding and focusing on CLTV can be one of the levers to rapid growth.

Some applications like Glew (available in the Shopify App Store) can calculate CLTV for you, and your average customer lapse point, but it’s a good idea to familiarize yourself with the metric anyway.

Kate runs an online store that sells pharmaceuticals online. She knows that her AOV is $100 and that her profit margins allow her to spend 15 per cent of on her cost per order (or CPO) on acquiring a new customer while still making a profit. In other words, to get a $100 sale, Kate can safely spend up to $15 on advertising.

Kate decides to focus on developing a loyalty program and gathering as many positive reviews as she can, with her goal being to increase purchase frequency and keep her customers for longer. As a result, she’s able to get her customers shopping twice a year instead of once a year, thus increasing her average purchase frequency.

Not only has Kate doubled her CLTV (as her AOV of $100 is now multiplied by two purchases instead of one per year), but she’s found that when customers shop the second time, she’s not having to spend marketing dollars on them due to her loyalty program offering free delivery.

So, if Kate now spends 15 per cent of her CLTV on marketing, instead of 15 per cent of one sale, she can actually spend 15 per cent of $200, not $100, meaning she can profitably spend $30 instead of $15 to acquire a customer, knowing they will come back and shop the second time without her having to spend marketing dollars on them. As a result, because her marketing activity has ramped up, so has her customer acquisition and her business! (The nearby sidebar ‘RFM analysis’ expands on this example further.)

Put the metrics of CLTV at the heart of all your marketing activities: AOV, purchase frequency and customer lifespan are all worthy projects that result in a fast-growing ecommerce business.

Loyalty programs are membership or incentive-driven programs that reward customers for being loyal. Customers can hit a certain level of reward through spending a certain amount, being a customer for a certain length, or referring a friend, plus a variety of other reasons. A referral program is considered part of a loyalty program. It specifically depends on a customer’s social circles to be influenced by a customer’s referral, and it focuses on your customers referring you new customers. Some loyalty programs have a referral component as part of the overall offering; however, they’ll drive revenue opportunities across a variety of strategies, including incentivizing higher spend, more frequent shipping, social shares and things like birthday rewards.

Referral and loyalty programs provide a host of flow-on benefits to your online store, including:

• Increasing repeat purchases by encouraging shoppers to use points and rewards for shopping
• Acquiring new customers
• Growing social audiences by rewarding social follows, likes and shares
• Incentivizing reviews and user-generated content
• Accessing your loyalty program’s customer insights and data

Here’s a list of some apps in the Shopify app store that can help you segment out your highest CLTV customers:

• Reveal: Customer Data Platform by Omniconvert SRL
• Everhort by Lifetime Analytics
• Segments Analytics by Tresl Inc.

When you know who your top customers are, the key is to treat them like VIPs!

Glew is a great app for when you’re a little bigger (see the nearby sidebar ‘RFM analysis’), as it spits out a variety of customer segments that you’ll be able to use in your marketing, but if you’re new to ecommerce then CLTV is probably enough to get you started.

In business, there’s something called the Pareto Principle, which means that 80 per cent of results come from 20 per cent of actions. In this case, it’s often true that 80 per cent of your sales come from 20 per cent of your customers. As well as finding your CLTV, try and segment your customers to find the group with the highest CLTV — and never, ever let them go.

Loyalty, referral programs and Shopify

Shopify has some great customer loyalty apps in the Shopify App Store, but it’s important to choose the right ones for your business. It’s important to understand what drives and motivates your customers to purchase, so I’d recommend asking your customers what drives loyalty for them. Typical loyalty and referral programs offer rewards in the form of accumulated points that can be exchanged for discounts, and I have seen programs like this improve key metrics, particularly purchase frequency.

In my experience, members of a good loyalty or referral program do have a higher CLTV than average customers. In the following sections, I look at some of the major loyalty and referral programs that you can integrate with your Shopify store.

Using customer reports in Shopify

If your store is on the Shopify, Advanced Shopify or Shopify Plus plan, then you have access to some useful reports about your customers. Using the reports listed below, you can find insights into your customers’ purchase patterns, including their average order count, whether they’re at risk of leaving you as a customer, or how much they’re predicted to spend in the future. Using that information, you can take certain actions to give a more personal service to these customers:

• Customers over time
• First-time vs returning customer sales
• Customers by location
• Returning customers
• One-time customers

If your store is on the Advanced Shopify or Shopify Plus plan, then you also have access to reports that identify:

• At-risk customers
• Loyal customers

Reports may not show activity from the past 12 hours, although the First-time vs Returning Customer Sales report is up to date to within a few seconds and can be refreshed constantly.

Customer reports are limited to 250,000 customers. If you have more customers than that, give yourself a pat on the back — you’re doing fine. You can, however, export all your customer details from the Customers page in your Shopify admin, in case you want to use your own reporting system (perhaps in Google Sheets or Excel), upload customer data into email marketing campaigns, or create Facebook audiences (I talk more about Facebook and email marketing in chapters 16 and 17).

Even if you’re using a selected time frame to view reports, take note that the data in the reports will be based on the customer’s entire order history. For example, if you retrospectively look at a customer report for a previous month, and a new customer who placed an order in that month has since placed an order in a subsequent month, they will be classified as a repeat customer, as Shopify is taking into consideration their entire order history.

To get started with customer reports, start by navigating to the reports section of your Shopify admin:

1. From your Shopify admin, go to Analytics → Reports.
2. In the Customers section, click on the report that you want to see.

The following sections run through the customer report options you can utilize in Shopify.

Customers Over Time

The Customers Over Time report shows how many customers overall have placed orders with your store since you started it.

You can select a unit of time in the Group By drop-down menu, located under the report title (see Figure 8-1), to control how the data is grouped. For short periods of time (say one month’s worth of data), I tend to group by day, and for longer periods of time I tend to look at the data grouped by week or month.

Checking by hour is also useful in determining when to send marketing campaigns or when to staff your customer service channels, such as phones or live chat.

The report shows both first-time and returning customers for each time unit selected. A first-time customer is a customer who has placed their first order with your store, and a returning customer is a customer who has placed an order, and whose order history already includes at least one order.

For each time unit, you can see the following data:

• The number of new (first-time) customers who placed an order during that time

  In ecommerce, customers who are placed into groups or segmented in this fashion are often referred to as cohorts.

• The number of returning customers who placed an order during that time

This report is useful for keeping an eye on the growth of both new and existing customers. As online stores seek to grow, sometimes existing customer can be forgotten, so it’s important to see the returning customer number growing each month — it’s a good health check for your business’s longevity.

Returning Customers

The Returning Customers report shows data about all your customers whose order history includes two or more orders. Remember your CLTV calculations (refer to the earlier section, ‘Understanding the lifetime value of a customer’) when you read through this report — the key metrics are found here.

You can see the following details for each customer:

• Their name
• Their email address
• Whether they agreed to accept marketing when they placed their most recent order
• The date of their first order
• The date of their most recent order
• The number of orders that they have placed
• Their average order value
• The total amount that they have spent, including taxes, discounts, shipping and any refunds

You can use this report to send emails to existing customers (as long as they have opted in to receive marketing, which you can see in the Accepts Marketing column in Figure 8-2 — Yes indicates they have signed up to receive your marketing; No indicates they would not like to receive your marketing). For example, you might email them special offers or thank you emails, or use the list to create ads in Facebook.

Customizing your customer reports

If your store is on the Advanced Shopify or Shopify Plus plan, then you can use the filtering and editing features to customize the reports about your customers. This is useful when you’re trying to sort through certain groups of customers.

As an example, you may want to email all your at-risk customers who have subscribed to your newsletter, so you navigate to the At-risk Customers report and select Manage Filters in the top-left corner. In the dialogue box that appears, you see a filter that says, ‘Is At Risk’, with a grey box under it that says, ‘Is Yes’ (see Figure 8-3). Under that you can add a new filter by clicking on the Add Filter box, then selecting Accepts Marketing in the Select Filter field, then typing Yes in the search field. Click on the green Apply Filters button in the bottom-right corner of the dialogue box and all your at-risk customers who have opted to receive your marketing will appear — which is great for Chapter 16, when I show you how to send marketing emails.

You’ll find the Manage Filters option in the same spot for all your Shopify reports.

Table 8-1 shows some of the filters and columns that you can use to customize your reports.

Being able to play around with filters in reports is going to help you find out more about your customers, such as who’s at-risk, who’s loyal, how much they spend and more. As you discover more about marketing in ecommerce, you’ll realize the value of segmentation — grouping together similar customers and setting up marketing automations for them, such as the marketing emails I cover in Chapter 16.

Leveraging Shopify’s customer reports is something I do almost every day. It’s essential that as a store owner, you get familiar with your customers, both loyal and at-risk. In this spirit of personalization, treating your VIPs well is a great place to start. Of course there are clever marketing tools that you can use to automate some of this, but I’m a big fan of personal service, and as such I’m an advocate of surprise and delight strategies, which are a great, old-fashioned way to give your customers a more personal experience (for more on these, turn to Chapter 10).