How to Identify and Target Your Whales?

Discover the key to explosive ecommerce growth by honing in on your VIP customers

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Hello, and welcome back to another edition of eCommerce Alchemy - your one-stop destination for everything related to ecommerce growth.

You've probably heard of the 80/20 rule, also known as the Pareto Principle. It's a concept stating that 20% of the effort often leads to 80% of the results—a common occurrence in various areas of life.

In business, this principle is crucial, especially regarding your customer base. Your top 20% of customers, nicknamed "Whales," typically bring in a significant portion of your revenue—sometimes as much as 70 to 90%!

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So, what does this mean for your ecommerce business? In this email, we'll dive into why identifying and targeting your Whales is essential. Plus, we'll provide practical strategies to nurture these relationships for long-term growth and success.

The Power of Whales: Maximising Your Top Customers' Impact

Your Whales, constituting the top 20% of your customer base, play a pivotal role in your business's success. Beyond their significant revenue contribution, they offer several key benefits:

  • Price Insensitivity: Whales prioritise value over discounts, ensuring long-term profitability.

  • Enhanced Loyalty: Whales are loyal customers who frequently return, boosting their lifetime value.

  • Word-of-Mouth Marketing: Happy Whales become brand advocates, driving new customer acquisition and lowering marketing costs.

  • Feedback for Innovation: Whales provide valuable insights for product development, fostering innovation.

  • Predictable Behaviour: Whales exhibit consistent buying patterns, offering stability in forecasting.

In understanding and leveraging the power of your Whales, you can enhance profitability and foster sustainable growth for your business.

How to find your whales on Klaviyo?

  • Go to Analytics > Metrics > Placed Order.

  • Calculate the total count of orders over a span of 3 months. For example, if the total orders are 689.

  • Change the 'measurement' to value and calculate the total revenue of 3 months. For instance, if the total revenue is $158,749.

  • Find the average order value (AOV) by dividing the total revenue by the total number of orders. In this case, AOV = $158,749 / 689 = $230.4.

  • Determine the average number of orders a customer places by creating order number wise segments.

  • Prepare a sheet to calculate the average number of orders per customer.

  • Identify customers who place more orders than the average and generate revenue that is at least 2 times the AOV.

  • Create a segment in Klaviyo with the following definition: "Customers who place more orders than the average and generate revenue that is at least 2 times the AOV are your Whales."

These customers are your whales.

Understanding Your Whales: Insights for Growth

Once you've identified your Whales, it's time to delve deeper into what makes them tick. Here's where to focus:

  • What products do they prefer?

  • Where do they come to your Ecommerce store from when they shop with you?

  • What device are they using when they shop with you?

  • Do they buy from you after receiving an email with news about special offers or new products?

By understanding their motivations and behaviours, you can craft a value proposition that strengthens their loyalty to your brand.

Strategies to Retain and Reward Your Whales for Long-Term Success

Retaining your Whales, the top 20% of your customer base, is crucial for sustained growth. Here are practical strategies to keep them engaged:

  1. Exceptional Customer Service: Offer personalised assistance and dedicated support channels to address their needs promptly.

  2. VIP Access to New Products: Provide your Whales with exclusive previews of new products and solicit their feedback to deepen the relationship.

  3. Surprise Gifts: Show appreciation for their loyalty with unexpected gifts that highlight their importance to your brand.

  4. Loyalty Programs: Implement special offers, bonuses, and preferred pricing to incentivize repeat purchases and foster loyalty.

  5. Purchase Anniversary: Celebrate the anniversary of your Whales' first purchase with a special discount or exclusive offer to acknowledge their loyalty.

  6. Birthday Rewards: Personalise the experience by sending heartfelt birthday messages along with special discounts or gifts, demonstrating genuine care for them as individuals.

  7. Early Access to Sales: Provide exclusive early access to sales events and promotions, making your Whales feel privileged and increasing repeat purchases during these events.

  8. Free Lifetime Shipping: Offer the perk of free lifetime shipping on all orders for your Whales, incentivizing them to choose your brand for recurring purchases.

  9. Personalised Recommendations: Utilise data to offer tailored product recommendations, showcasing products aligned with their preferences and past purchases.

  10. Invite-Only Events: Organise exclusive invite-only events, online or in-person, where your Whales can interact with your brand, preview upcoming products, and receive special offers, fostering a sense of belonging and appreciation.

  11. Customer Feedback Incentives: Encourage your Whales to provide feedback on their shopping experience by offering incentives like store credits, discounts, or entry into exclusive giveaways, leveraging their insights to improve your services and products.

  12. Priority Customer Support: Ensure your Whales receive priority customer support, providing them with a dedicated helpline or email address to resolve any issues promptly.

  13. Exclusive Content and Sneak Peeks: Share exclusive content such as behind-the-scenes videos, product development updates, or early access to blog posts, fostering a deeper connection and loyalty to your brand.

  14. Tiered Reward System: Implement a tiered reward system offering increasing benefits based on their loyalty level, with higher tiers unlocking more exclusive rewards and perks.

Your Whales are the backbone of your ecommerce success. Understanding their preferences, nurturing relationships, and providing exceptional value are key to long-term growth. 

By implementing practical strategies to retain and reward them, you pave the way for sustained success and profitability. So, dive into your data, nurture your Whales, and watch your business flourish.

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