How Does Klaviyo Work for Ecommerce?
Klaviyo is a data platform, integrated with SMS marketing and many more tools to help ecommerce stores generate more sales. To better understand how Klaviyo works and why many online retailers rely on this platform to increase their sales, we first need to understand the foundation of how it works.
The Foundation: Data Collection and Integration
Klaviyo is a data platform first, marketing tool second. The platform is able to pull in information from a variety of sources (such as Shopify, WooCommerce, BigCommerce, Magento and more). The information pulled in can be a range including your customers’ browsing behaviour, the products that they have viewed, the items that have been added to basket, your customers’ past purchases, the average order value of your customers’ orders and how your customers have interacted with previous emails.
When your store is connected to Klaviyo, it begins to collect as much data as possible from your ecommerce platform. As more information is collected about your customers, it starts to build a profile for each of them. The tracking script on the front end of your store and the API connection on the back end allow Klaviyo to start to build a customer profile for every visitor to your store. That profile is then updated in real time with the latest information as it is collected.
Building Customer Profiles
In the customer profiles created in Klaviyo, every interaction with the online shop or emails is stored. Customers who view products multiple times, abandon their shopping cart and then log into the online shop two weeks later to place a completely new order will receive messages that are highly relevant to them.
Segmentation: Turning Data into Targeted Groups
These segments can then be used as the basis of targeted marketing campaigns. As a customer’s behaviour changes over time, such as from being a first-time buyer to a repeat customer, they will automatically move to different segments, allowing the retailer to send relevant marketing messages.
Klaviyo segments are automatically updated in real time, so your customer is automatically moved to the correct segment they now belong to as their behaviour changes. So, for example, a new customer is automatically added to a segment of new customers but, as they make repeat purchases, they will automatically move to a segment of frequent shoppers, such as repeat customers and more.
Predictive Analytics
Klaviyo also comes with built-in predictive analytics, which can predict the expected date of the next order, whether a customer is likely to churn and a customer’s predicted lifetime value. This is done by the software’s machine learning, which uses historical data from the store, as well as future behaviour.
Automated Flows: The Engine of Klaviyo
The most valuable part of Klaviyo for online retailers is the flows function. A flow is a programme made up of a number of steps, and each step is a message within Klaviyo. So, for example, a flow could be triggered by a customer abandoning their basket and the first step in the flow would be an automated email to the customer to come back to the site and complete their purchase. This email would be sent one hour after the customer has abandoned their basket and then a day later the customer would receive a second automated email that contains a discount code off their next purchase.
This is a simple example of a flow but, as you can see, it is very powerful in recovering lost sales. As well as abandoned baskets, flows can also be triggered by a customer completing a purchase and then a series of automated emails and SMS messages can be sent to that customer after purchase in order to gain feedback and also to try and get the customer to return to the site and make another purchase.
Flows are typically set up as a welcome series of emails to new customers, a series of emails after a purchase to thank the customer for their purchase, a series of browse abandonment emails and, finally, win-back campaigns for customers who have not been active in your store for a period of time.
Combining Email and SMS
You can also add individual email and SMS messages to your flows and campaigns. Each message will be sent to the individual customer’s email address or SMS number stored in their profile. For example, a basket abandonment flow could send the first message as an email to a customer’s primary email address. If that email is not opened, then the next message will automatically be sent as an SMS to their mobile number.
Campaigns for Broader Communication
A campaign is essentially a single ‘send’ of a message to your customers. This is used for a variety of reasons, including product launches, sales and newsletters. The campaign can be set up and then sent at a set time to a set segment of your customers. Much like the Klaviyo flows, the way in which you set up your segments can be as complex as you like and therefore you can target your customers in exactly the same way that you would with a flow.
Measuring Performance
This means that all money made from individual emails and SMS messages, as well as from the Klaviyo automation, can be tracked so that the individual email or SMS campaign, as well as the Klaviyo automation flow that is generating the most return, can be identified. This allows for future changes to maximise return.
Conclusion
Klaviyo, by uniting the largest amount of data from a customer’s behaviour with dynamic segmentation and programmatic and automated marketing messages, makes online marketing much easier for online stores. Klaviyo enables them to make more informed online marketing decisions and react in the smartest possible way to their customers’ behaviour.