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In today’s competitive e-commerce landscape, customer retention and lifetime value are paramount for sustainable growth. In this insightful interview, we dive into the strategies and experiences of Tim Kilroy, a seasoned marketing and sales executive with over 18 years of experience. Tim shares his unique approach to surrounding customers with the right marketing messages and leveraging AI to enhance customer experiences. Join us as we uncover actionable insights and proven methods to boost your business by following up effectively with your customers.

The only way to scale is to retain customers.

Key Takeaways

  • Mid-Funnel Focus: Engage customers with useful mid-funnel content.
  • AI Integration: Use AI for predictive personalization and advanced analytics.
  • Customer Retention: Build relationships through multi-channel follow-ups.
  • RFM Segmentation: Start with RFM to improve customer segmentation.
  • Continuous Engagement: Maintain relevant engagement to boost retention.

Welcome to Growth Interviews!

Welcome to Growth Interviews, the fun, stimulating, and engaging series of conversations driven by digital business growth.

Our mission is to provide insights and ideas from world-class professionals on growth and to cut through the noise of so-called marketing tips and tricks, revealing the money-making strategies behind e-commerce.

Each episode is an intriguing challenge involving an insightful expert who reveals some of their best-kept secrets, which you can use right away to boost your business. 

In this week’s episode of Growth Interviews, we invite you to join our conversation with Tim Kilroy, a senior marketing and sales executive with more than 18 years of experience in creating companies and helping retailers and agencies achieve faster growth.

His deep experience in search and social media has allowed him to create new business processes, in a successful effort of driving massive revenue growth. 

A big part of Tim’s legacy also stands in his work with agencies. His consultancy business focuses on solving marketing, messaging, business development & process problems. In his own words, Tim helps agencies create more revenue and more profit.

Tim has been the creative force behind several companies, where he’s held C-level positions and created new opportunities by extending and creating new company core competencies.

During our interview, we asked Tim about his main growth ideas for eCommerce companies. His unique perspective on surrounding the customer with the right marketing message, approaching them wherever they are, and how AI will change the required skills to work in the industry might surprise you. 

Have a listen to his thoughts on scaling your way to customer retention using a segmentation strategy like RFM and more in the podcast below. 

We know you’ll want to come back and take notes, so let’s get into the main ideas from our talk with Tim Kilroy. 

eCommerce Growth Strategies

Infographic outlining strategies for customer acquisition, delight, conversion, and engagement, including using chatbots, optimizing for mobile, retargeting customers, and gamifying shopping experiences.

Valentin Radu: I planned to ask you about three growth ideas for e-commerce companies.

Tim Kilroy: The strategy is to be in front of your customers enough so that they don’t have to race to the bottom of the funnel. So, you have to think about going from the top to the bottom of the funnel through the mid-funnel. You have to surround your customers. 

In many ways, you need to think about your retail marketing the way that enterprise companies think about software marketing where someone expresses interest and suddenly, they’re surrounded. 

You capture these people, you’re sending them emails, you’re inviting them to webinars and that’s what enterprise sales companies do, and retailers have to do the same. When someone expresses interest when they make that first visit, rather than just assaulting them with retargeting that’s swinging by, give them some reason to give you their email address and start a relationship with them. 

So, when they are ready to buy that thing that you are selling, they don’t have to go to Google or look for the lowest price or go to Amazon and look for one-day shipping. They’re comfortable with you. So the strategy is just to attack the middle of the funnel rather than the bottom of the funnel. And the way that you need to do that is tactically by focusing your search activities on that sort of mid-funnel. 

Your programmatic display needs to be focused on the mid-funnel. Also, what you need to do is you need to invest in selling content, customer-facing selling content, buying guides, and all this stuff that makes people feel good creates a relationship, and generates emotion. 

If you’ve been in marketing for a while, you’ve probably heard of the Rule of 7. The idea is that a prospect needs to hear or see the brand’s message at least 7 times before converting.

In the digital age, that strategy’s odds of success are pretty slim. Social media touches customers constantly, even more than 7 times every single day. If you want to stand out and encourage your audience to convert, you need to approach your clients in the middle of the sales funnel, with useful content that will delight and engage them.

Be where your clients are: email them, message them on Facebook, follow and engage with them on Twitter, interview them on YouTube, and respond to their comments on your blog. 

Artificial Intelligence is Transforming the Customer Experience

Illustration of a large robot interacting with people on digital devices, symbolizing AI transforming customer experience, with cloud and gear icons in the background.

Valentin Radu: We are living in this era where there’s this big wave of machine learning, deep machine learning, AI. What’s your take on this and how do you think this is going to affect the whole eCommerce landscape?

Tim Kilroy: So, as much as we all like to think that we are unique and have our thought processes, we don’t. AI,  over time, is going to get good at serving up what we want because we’re just not that unique. 

So, what’s going to happen? How’s it going to impact e-commerce? It’s going to profoundly change the kinds of skills that you need to work in e-commerce because suddenly, experientially, that will be driven differently. There will be less focus on designing a customer journey and more focus on making it great. 

AI is transforming how businesses operate, from data collection and processing to the kind of skills required to improve customers’ experience with your brand. 51 percent of companies are already using AI and more than a quarter plan to deploy it within the next two years.

Here are 3 ways AI can and will improve everyday experiences for your customers

  • ? Self-service. Chatbot apps have become a prerequisite for service-oriented brands. They eliminate the need to wait for the next available agent and allow companies to offer faster, more effective, and more pleasant customer service. Plus, chatbots offer 24/7 support, which is more than most companies can say or do.
  • ? Predictive Personalization. Customers are more likely to buy from a company that’s presented them with a personalized experience. It shows they’ve taken the time to get to know them. AI provides a better understanding of how you can make a customer’s experience great, and more relatable to them and their emotions.
  • ? Customer Analytics. An AI program can provide a better experience to your customers by searching through larger and more complex data sets to extract information about the customers themselves. This will allow your brand to create new opportunities with new products, personalization, up-selling, or cross-selling.

Customer Retention is a Purposeful Act

Illustration of a person using a magnet to attract customers, symbolizing customer retention, with stacks of coins representing revenue.

Valentin Radu: So, tell us a bit about customer retention. You’ve said earlier, that it’s the third day that matters. We’ve been running this study, we’ve been seeing the data. We were somehow surprised and then we said okay let’s cheer up that’s it because we are focusing on building software and technology towards revealing buying patterns and segmenting and empowering the e-commerce players to fill these. But we’re seeing that there is no market here for us. What’s your take on customer retention and why do you think it matters? If you think it matters for e-commerce players.

Tim Kilroy: Yes. So, the only way to scale is to retain customers. Because, if your only trick is to acquire customers, you never increase your margins. It never gets better. So, customer retention is crucial. And again, this is something that lots of retailers have a huge issue with. Because they are so sure. Everybody has an overinflated sense of their impact.

Retailers are so sure. Even small retailers who don’t really have a strong brand are sure that their brand is good enough that customers will come back to them anyway. But this is sort of old retail thinking where you could get repeat customers just by the convenience of location. That’s why malls exist. But on the Internet, there aren’t. 

Amazon is the only mall. So, what you do need is to be obsessive about following up, in a highly relevant fashion, with your customers. And part of it is email, absolutely, but not only. It needs to be the messaging. It’s got to be on Facebook. It’s got to be on Instagram. It’s got to be on Twitter and take targeting wherever else it’s going to be on Pinterest. 

Wherever your clients are, you’ve got to be there because even though they have purchased from you, you don’t have a right to the next purchase. With my last agency, we did this really fantastic analysis for one of our clients but we found out that first-purchase customers only had a 17% chance of becoming second-time customers. 

But then, there was a 50% chance that the second-time customers would become third-time customers. And if you were a third-time customer, there is a 95 %chance you’re going to be a fourth-, fifth-, or sixth-time customer. It’s like the third date. We get to number three; it’s all over.

But so many people look at customer retention for that first 30-day period. Well great, we have a new customer, put them into our four email sequence because we know that someone is going to buy and it looks better for us if they buy within 30 days. It’s harder to get them to buy on day 45 than it is on day 29. True. But you don’t have any right to that sale. Also, you’ve still got to work for it. But it is much more about presentation and relevance than it is about promotion, price, and product.

Valentin Radu: Yeah, I’m totally with you on this. We’ve been looking at this retention curve. I’ve been focusing on customer retention since 2015 for other companies, and in my own company, I’ve been looking at the retention rate. 

We were selling car insurance so the game was pretty clear if people were not returning because the number of drivers and cars is limited. So, we need to persuade them to buy over and over again. And we’ve been looking at the days between transactions, at the customer retention curve, and those chances to buy again after the second, third, fourth order. 

And we’ve seen that the outliers, the companies that had a very strong brand, they’ve had a strong brand and that’s the debate, that’s the dilemma. They have a strong brand. They’ve been present because they’ve over-delivered and that helped them get funded so that they can amplify their voice because of the lucky strike. 

And that’s the debate I would like to get ourselves into. If you are a very strong retailer like Wal-Mart, you are present there and maybe people are buying and they are forming their habits not because of your customer experience, but because of their biases, their convenience. Right?

Tim Kilroy: Right. Yes. I think customer retention is a purposeful act. And if you look at the budgets of most retailers, acquisition is overrated and retention is underrated. Mostly because there is that bias, they (the customers) had a great experience. They didn’t return but it’s cool. 

They’re going to buy again. But, what you need to think about is the art of a customer. So, you were willing to spend into acquiring a customer because the minute before someone buys something from you, they have the highest lifetime value. Because all of their lifetime value is unexpressed. They never purchased anything from you, so they’re super valuable. 

However, the few retailers who think about lifetime value, want to capture these high lifetime value customers. But what they’re not doing is they’re not maximizing the expression of that lifetime value throughout their customer relationship. 

And it’s simply because it’s harder. Because you are no longer thinking about search terms about promos or loss leaders. What you’re looking at is building a relationship with these customers so once they’ve made one purchase you need to make sure that you’re increasingly relevant to them over time.

Customer retention is all about following up. It’s about how much time and effort you’re willing to put into engaging your customers in the long term. Some of that is financial, but mostly it’s about knowing where your customers are and what their lifetime value means to you.

One thing most brands can agree upon is that the highest lifetime value of a customer is right before they purchase something from their brand. But at its core, CLV is about becoming increasingly relevant to your customers over time.

You’re never guaranteed a 2nd purchase, let alone a 3rd, 4th, or 5th one. You need to look at building a relationship with your high-lifetime value customers, so once they’ve made one purchase, you have a shot at getting the next purchase as well.

Recency, Frequency, and Monetary Value is the Best Place to Start

Infographic explaining RFM metrics: Recency (freshness of customer activity), Frequency (number of transactions or visits), and Monetary (customer's spending intention or purchasing power).

Valentin Radu: What about RFM? Recency, frequency, monetary value. Have you seen retailers using it? Do you think it’s a good bet to segment your audience like this? Unless you are not selling out wedding rings or something like that.

Tim Kilroy: That is one of many segmentation strategies you should try. For me, if I would start, if I did not have any segmentation, RFM would be the first place to start because frankly, it’s the easiest. You need the least amount of customer data to do RFM. All you need are dates and transaction amounts. 

That stuff’s easy to get at. Other kinds of segmentation are either demographic or psychographic or different kinds of behavioral than RFM. So, yeah, RFM is an awesome place to start because it’s the closest thing to a universally applicable segmentation strategy that there can be. It makes the most sense for most people

Here’s How You Can Apply The Rfm Model In Your Own Business

Email Marketing

Laser-focused, highly relevant email campaigns drastically improve results. Using RFM, you can segment customers by interests, open and click rate, and move them between lists as they move from one segment to another.

Customer Lifetime Value

Targeting segments with content they are more likely to respond to means that RFM can assist in increasing your customers’ lifetime value by reducing churn, offering insight into up-sells and cross-sells, and increasing loyalty and referrals.

Improve ROI

Categorizing your customers into smaller segments means you can target them with more relevant ads, which will significantly reduce PPC costs. It also means those customers are more likely to respond to those campaigns, improving your return on investment.


These strategies and more are the secrets behind how Tim Kilroy manages to develop and sell multiple agencies for 7 figure earnings. If you take one insight away from this interview, let it be this: 

Don’t just acquire. Retain. Be obsessive about following up with your customers. Do it in a highly relevant fashion. 

Frequently Asked Questions

How can small e-commerce businesses effectively implement mid-funnel strategies?

Small e-commerce businesses can start by creating engaging content such as buying guides, product comparison charts, and customer testimonials. They should also focus on capturing email addresses through lead magnets and consistently follow up with personalized email campaigns to nurture relationships.

What are some practical ways to leverage AI to improve customer retention?

Practical ways to leverage AI include implementing chatbots for 24/7 customer support, using predictive analytics to anticipate customer needs and personalize marketing messages, and analyzing customer behavior to tailor product recommendations and offers.

How do you measure the success of a customer retention strategy?

Success can be measured by tracking key metrics such as customer retention rate, repeat purchase rate, customer lifetime value (CLV), and Net Promoter Score (NPS). Additionally, analyzing engagement levels with follow-up communications and monitoring the reduction in customer churn can provide insights into the effectiveness of retention efforts.