The power of known customers: Key to retail growth

Growth is not always about acquiring more customers. For modern retail brands, the real unlock often lies in recognizing the ones who have already walked through the door.

In a joint report by EY and Shopify, one finding stood out: known customers, those whose identity and purchase behavior are linked across channels, drive up to 76% of in-store sales growth. They return more often, spend more per visit, and respond better to marketing. In other words, they are not just valuable. They are essential.

Yet most retailers still treat online and offline shoppers as two different audiences, running fragmented systems that fail to capture even basic customer data. Shopify’s unified commerce model flips this approach. With tools like Shopify POS and Shop Pay, merchants can seamlessly turn walk-in shoppers into high-value, trackable profiles, unlocking retention, personalization, and long-term lifetime value.

This blog breaks down what “known customers” really are, how they create measurable business impact, and how Shopify enables brands to build smarter retail strategies around them. Whether you run a multi-location store or hybrid DTC brand, understanding and activating known customers is no longer optional. It is the strategy.

What is a known customer?

Retailers today collect more data than ever before. Yet most are still unable to translate that data into real business value. Fragmented systems, siloed channels, and disconnected customer touchpoints all contribute to a broken view of who the customer really is. That’s where the concept of a known customer becomes essential.

Defined in the EY x Shopify report (PDF), a known customer is more than someone who left their email address. It is a shopper whose identity, preferences, and behaviors are actively collected, organized, and activated across both digital and physical channels.

Known customers are fully embedded in the retailer’s data ecosystem. This allows for:

• Smarter segmentation and targeting
• Personalized checkout and post-purchase flows
• Consistent brand experiences across every touchpoint
• Long-term retention and higher customer lifetime value

EY’s analysis highlights that known customers should be treated as a strategic asset, not just a list of contacts. They are the foundation of personalized commerce, enabling brands to move beyond transactional relationships.

From unknown to known: The customer evolution

The report introduces a four-stage framework that outlines how shoppers move from being anonymous to fully known:

Stage	Data Characteristics	Personalization Level	Business Impact
Unknown	No identifiable data	None	One-time engagement
Identifiable	Basic contact info, no unified profile	Low	Limited retargeting
Transactional	Purchase history, but channel data remains siloed	Moderate	Occasional engagement
Known	Unified data across channels, enriched continuously	High	Higher CLV, loyalty, and advocacy

As customers move up this chain, their commercial value grows. But most retailers still operate in the “transactional” stage, capturing data without truly activating it. Known customers, by contrast, enable retailers to deliver 1:1 personalization at scale.

Why known customers drive measurable growth

While most retailers focus on bringing in new traffic, the greatest commercial impact often comes from deepening relationships with the people already in your funnel. Known customers do not just convert better, they fuel retail growth at scale.

According to the EY x Shopify report, retailers using Shopify POS who prioritize known customer acquisition and retention see:

• 76% of in-store GMV growth driven by known customers
• 3× higher average order value compared to unknown customers
• 61% increase in repeat purchases, rising to 74% among retailers with revenue above $20 million

These numbers are not isolated. A 2024 McKinsey study confirms that personalization done right can lift revenue by 10–15%, and increase marketing ROI by up to 30%.

Known customers are also more likely to engage with post-purchase communications, participate in loyalty programs, and become brand advocates, key behaviors that reduce acquisition costs over time.

Shopify as an engine for known customer growth

Shopify’s unified data model plays a pivotal role in capturing and activating known customer data. Through the use of Shopify POS and the Shop app network, brands can:

• Match in-store card transactions with existing Shop Pay accounts
• Instantly surface contact information for frictionless checkout
• Collect structured data through metafields (e.g. fit preferences, pet breed, loyalty tier)
• Automatically segment audiences with Shopify Flow and trigger marketing automations

In fact, 80% of first-time in-store shoppers on Shopify POS are converted to known customers, thanks to Shopify’s intelligent data match at checkout.

Case studies like Little Words Project, Castañer, and Fairfax & Favor show how structured data capture at POS can transform in-store purchases into long-term digital relationships. These brands reported increases in email capture (up to 95%), attach rates, and opt-ins, driving more effective remarketing efforts.

By nurturing known customers, retailers not only build loyalty but also unlock more efficient growth.

How to build a known customer base with Shopify

Capturing data is only the first step. To truly build a base of known customers, retailers need a system that collects, organizes, and activates data seamlessly, across every touchpoint. Shopify enables this through its unified commerce infrastructure, especially when paired with tools like Shopify POS and Flow.

The known customer growth cycle, as defined by EY, follows a three-part framework:
Collect → Organize → Activate

1. Collect: Frictionless in-store data capture

Unlike online checkout, in-store purchases often lack a clear entry point for data capture. Shopify solves this through intelligent matching via the Shop Pay network. When a customer uses a credit card at POS, Shopify can automatically surface their saved email or phone number (if matched to a Shop account), enabling:

• Seamless digital receipts
• One-tap marketing opt-ins
• 80% conversion rate of in-store buyers to known customers

For brands like Little Words Project, this improved data flow led to a 20–95% increase in email capture across stores.

At Flatline, we often integrate Shopify POS with tailored onboarding flows, allowing retail brands to maximize attach rates without interrupting customer experience.

2. Organize: Enrich and structure customer profiles

Capturing information is not enough, organizing it matters just as much. Shopify’s metafields let retailers define and structure custom data points for each customer, like preferred stylist, shoe size, dietary needs, or pet breed.

This structured data feeds into the unified customer profile, ensuring all attributes are actionable across campaigns, loyalty programs, and customer service.

One of Flatline’s Shopify Plus projects integrated metafields and automated tagging to help segment retail customers based on location, purchase behavior, and loyalty status, unlocking hyper-personalized email flows.

3. Activate: Move beyond segmentation into automation

Once a customer profile is enriched, activation is where growth happens. Shopify offers multiple options here:

• Shopify Flow: No-code automation builder for segmentation and retargeting
• Third-party integrations: CRM, loyalty, or CDP tools (e.g. Klaviyo, LoyaltyLion)
• Custom apps: For event triggers or in-store to online handoffs

The key is speed and scalability. Instead of waiting days to sync data across platforms, Shopify’s unified model makes customer attributes instantly usable across the entire stack, marketing, support, POS, and even product recommendations.

Known customers become marketing-ready profiles, and retailers can act on behavior in real time.

Why personalization pays off: The ROI of known customers

Moving customers into the known category is not just about better targeting, it is about better economics. When data is complete, organized, and actionable, every interaction becomes more meaningful. And more profitable.

Known customers convert better, spend more, and come back more often. According to the EY x Shopify analysis, retailers who activate customer data through structured personalization see:

• 3× higher conversion rates from known vs. unknown customers
• 8× return on marketing investment (ROMI) due to better targeting
• 20% boost in profitability, thanks to more efficient spend
• 10% reduction in acquisition cost, driven by improved segmentation

These results are supported by external research. A Forrester report found that companies who centralize customer data and personalize accordingly outperform peers on retention, loyalty, and customer satisfaction.

From data to action

Shopify gives retailers multiple paths to activate their customer insights, from re-engagement campaigns to loyalty programs to upselling workflows. When powered by unified data, these tactics deliver results that standalone tools simply cannot match.

Some practical examples from Shopify merchants:

• Location-based segmentation: Use past POS data to invite VIP customers to local store events
• In-store to online triggers: Recommend product variants that were not available in-store
• Cart abandonment: Reconnect with online visitors via store-specific follow-ups
• One-to-one recommendations: Push custom offers based on past purchase behavior

At Flatline, we work with brands to embed these flows into their Shopify stack using tools like Shopify Flow, Klaviyo, and custom data triggers. The result is personalization at scale, with automation, not extra headcount.

Common pitfalls and how to avoid them

Retailers often underestimate how easy it is to lose the value of a potential known customer. Even when tools are in place, execution often breaks down due to poor data capture, inconsistent systems, or manual workflows that cannot scale.

Below are the most common challenges brands face when building a known customer base, and how Shopify solves them.

Friction during checkout

Many brick-and-mortar stores rely on store associates to manually ask for emails or phone numbers. This process is inconsistent, intrusive, and error-prone. Customers may decline, provide incorrect info, or simply skip the process altogether.

Shopify solution:
Shopify POS automatically surfaces customer contact information using encrypted card matching with Shop Pay. This reduces friction, improves data accuracy, and streamlines opt-ins, with up to 80% conversion to known customers at checkout.

Data silos across tools

Retailers often store customer data across different systems, POS, CRM, loyalty apps, ecommerce. This fragmentation creates blind spots in segmentation and personalization.

Shopify solution:
With its unified data model, Shopify consolidates customer, product, and order data across all channels into a single profile. Fields like metafields allow for custom attributes to be captured and activated at scale.

Manual activation delays

Even when data is captured, many teams struggle to use it. Exporting lists, cleaning spreadsheets, and syncing platforms wastes time and reduces personalization impact.

Shopify solution:
Shopify Flow and segmentation tools allow brands to build real-time automations that trigger personalized experiences instantly. No manual work. No delays.

Common pitfalls vs Shopify solutions

Pitfall	Impact on business	Shopify solution
Manual data entry at POS	Inaccurate data, missed opt-ins	Shop Pay match for automatic contact capture
Siloed systems (CRM, POS, apps)	Incomplete profiles, inconsistent personalization	Unified data model + metafields
Delayed segmentation	Slow campaign launches, lost revenue	Shopify Flow + real-time segmentation
Lack of structured data	Cannot scale personalization	Custom metafields + automation-ready customer profiles

Retailers who overcome these friction points gain a competitive edge, not only in marketing, but also in retention, product recommendations, and operational efficiency.

Conclusion: From transactional to transformational

Retail success no longer hinges on how many customers walk through your door, but how well you know them when they do.

The EY x Shopify report makes one thing clear: known customers drive growth. They buy more, return more often, and engage more deeply. And with the right infrastructure in place, they are not difficult to identify or activate. The challenge lies in execution, making sure that data flows from your POS to your marketing stack, that segmentation is accurate, and that personalization happens in real time.

Retailers that move from a transactional model to a known customer strategy gain:

• A unified customer view across all sales and marketing channels
• Stronger retention and higher lifetime value
• Increased marketing efficiency and measurable ROI

But this shift requires more than just software. It takes a commerce strategy that connects customer identity with business outcomes, from checkout to reengagement.

At Flatline, we help retail brands build Shopify systems where known customers are not an afterthought, but the foundation. Whether you’re migrating to Shopify POS or rethinking loyalty strategy, our team ensures that customer data is captured, organized, and activated by design. Ready to unlock the power of known customers? Let’s talk about how to build it.