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Writer's pictureRyan Holmes

Customer Lifetime Value tops ecommerce priorities for 2021

Updated: Apr 16, 2023

Customer Lifetime Value (CLV) has been identified as the top success metric for 2021, ahead of Conversion Rate Optimisation (CRO) and Customer Acquisition Cost (CAC), as digital businesses recognise the value of building long-term customer loyalty over ‘quick-win’ one-off conversions, according to a global survey of 100 senior ecommerce managers.

Customer Lifetime Value tops ecommerce priorities for 2021

With the rapid acceleration of ecommerce in 2020, companies are shifting their priorities to focus on optimising the experience for existing customers as they look to build long-term loyalty and brand relationships in 2021 and beyond, according to a joint report, ‘Ecommerce Leaders 2021 Survey’, from Astound Commerce, the world’s largest independent digital commerce agency, and Namogoo, the Customer Journey Hijacking prevention specialist.


Keeping customers happy for the long-haul means tapping into the mindset of the first-time shopper, according to the research of 100 senior eCommerce professionals.  52% of companies estimate that first-time shoppers will make up more than a quarter of their total visitors in 2021, with almost three quarters (74%) expecting first-time shoppers’ visits to grow by more than 10% across the year.


However, nearly all respondents (97%) see first-time shoppers as a challenge, perceiving them to be less loyal (45%), more price sensitive (58%), easily distracted and susceptible to being swayed by the competition (51%).


To counter these issues, 79% of respondents indicated they would offer discounts and incentives to get the attention of first-time shoppers, with 58% saying they would use behavioural analytics to improve personalisation.  More than a third (35%) of companies surveyed said they would put measures in place to reduce or remove distractions caused by injected competitor advertising designed to hijack customers to other promotions before brand loyalty has been established.


Ecommerce companies looking to improve CLV need to focus on solving the first-time shopper challenge, commented Terry Hunter, Managing Director, Astound Commerce:


“With the accelerated and sustained shift to ecommerce in 2020, we saw huge volumes of new shoppers shifting – and staying – online. At the same time, digital-natives became entrenched in emerging and elevated expectations of online shopping experiences. The challenge for retailers in 2021 will be in how they meet the needs of these consumer cohorts, each with their own unique set of demands. Enhancing the end-to-end customer experience, driven through hyper-personalisation and seamlessly connected buying journeys is crucial. We will see brands and retailers that double down on investments that unlock these capabilities thrive in the year ahead.”


Following the disruption of 2020, retail brands must be ruthlessly focused in an increasingly competitive trading environment, commented Chemi Katz, CEO and co-founder, Namogoo:


“Looking ahead we see retail brands making a definitive shift in priorities: from focusing on acquiring traffic to delivering experiences that produce loyal lifetime customers. This industry-wide reprioritisation was what spurred Namogoo to initiate the survey with Astound Commerce. Our findings clearly show brands will be focused on implementing innovative tools that help solve the first-time shopper challenge, increase customer loyalty and retention, and minimise friction and disruption in their customer journey efforts. In 2021, ecommerce companies will prioritise technologies that can quickly deliver ROI, and if a solution cannot verifiably demonstrate this, they’ll swiftly move on to another one.”


For more information on the key priorities for ecommerce companies in 2021 and beyond, download the ‘Ecommerce Leaders 2021 Survey’ report.


Original research of 100 senior eCommerce managers conducted during November 2020, commissioned by Astound Commerce and Namogoo

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