Klaviyo Shopify partnership

What is Klaviyo? An Introduction to Shopify’s Latest $100M Investment


In the eCommerce world, an effective email marketing strategy can be the gift that keeps on giving. From automating personalized messages for each customer to analyzing user behavior and providing product recommendations at scale, there’s no limit to how brands can use email marketing automation and big data to boost eCommerce sales. Klaviyo is a market leader in this category, and its position was cemented by a recent investment from Shopify which also named them the recommended email marketing solution for eCommerce stores using Shopify Plus.

For an online brand that generates large amounts of consumer data from people’s interactions with an eCommerce store, products, and communications, Klaviyo’s robust feature set and predictive analytics platform will likely prove to be useful for increasing conversions, repeat purchase rates, and customer lifetime values. Retailers can leverage these insights to turn potential customers into profitable long-term relationships at scale with Klaviyo.

In this short guide, we’ll explore the benefits of using Klaviyo, how it automates marketing emails and SMS campaigns, and how brands can harness the power of personalized cross-channel communications.

What is Klaviyo?

At its core, Klaviyo is an email and SMS marketing platform designed to deliver personalized experiences and communications to the customers of eCommerce brands at scale. Brands rely on Klaviyo to help them create high-value relationships with customers.

Klaviyo achieves this by giving brands the tools to build multi-channel experiences to manage all of their contacts’ data and use it to deliver personalized marketing messages. The platform also has powerful automation tools that use machine learning and AI models trained on a store’s unique customer data to provide insights on likely future consumer behavior.

The company was founded in 2012 and has grown at a rapid rate over the last decade. eCommerce brands and marketers use it to set up complex sequences of triggered emails and SMS campaigns that are personalized and timely for each customer and subscriber – depending on their individual behaviors and actions when interacting with an online store.

Why Shopify is Betting Big on Klaviyo

Shopify and Klaviyo recently announced a strategic partnership where Shopify will start recommending Klaviyo as their preferred email product in their premium merchant plan, Shopify Plus. This deal also saw Klaviyo receive $100 million in strategic investment from the eCommerce giant.

While there is no shortage of competing marketing automation tools, Klaviyo’s record speaks for itself. With over 100,000 paying customers as of 2021 Klaviyo has helped businesses bring in more than $17.5 billion in revenue. There’s no denying it’s one of the leading eCommerce solutions for email and SMS marketing. 

Shopify sees the potential of Klaviyo and its role in the future of marketing technology hence the significant investment. Over the last ten years, Klaviyo has managed to attract some big-name customers including Unilever, Decathlon, and Theory11. 

To date, Klaviyo has raised over $775 million and has more than 1000 workers globally. This latest investment from Shopify brings the startup’s valuation to around $9.5 billion.

How Klaviyo Drives Results for eCommerce Brands With Automation

With Klaviyo email and SMS marketing, brands can automate the process of sending emails to their audiences by setting rules to personalize campaigns for each user before they are sent. Effective email automation is all about tailoring the messages to each user depending on their behavior.

Klaviyo uses timed sequences to automate both email and SMS marketing as part of a single campaign. Once someone satisfies a trigger such as looking at a certain product, adding something to their shopping cart, or buying something, a personalized message is sent out automatically after a predetermined period of time across multiple channels, or just a single channel depending on the situation.

One of the most common examples of email automation in eCommerce is the abandoned cart or abandoned checkout campaign. This is one of the many ways Klaviyo allows Shopify stores to automatically send personalized emails or texts to shoppers who abandoned their cart, reminding them what they were about to buy. It’s estimated that 70% of all shoppers end up leaving their cart with products before checking out. 

In another situation, suppose a store has potential customers who have previously shown interest in one or more products that were out of stock. These people can be added to Klaviyo’s back-in-stock email automations to notify them instantly and automatically when the items they showed interest in are restocked.

These are just two examples of the many pre-configured automations Klaviyo offers Shopify store owners across email and SMS marketing channels.

A small selection of Klaviyo’s pre-configured email and SMS automations.

Personalized Email and SMS Marketing in a Single Platform

Most people spend more time on their phones than on laptops or computers. From researching and discovering products to making purchases and leaving reviews, phones significantly influence eCommerce purchase behavior. 

It’s estimated that 98% of all SMS messages are opened, and a significant percentage of them even get read within a few minutes of sending.

To capitalize on this, Klaviyo SMS allows Shopify brands to deliver personalized text message marketing campaigns at scale using all the same data marketers are used to leveraging for email automation. After collecting consent from contacts, brands can start sending SMS campaigns in the United States, Australia, United Kingdom, and Canada.

As with email, Klaviyo gives brands the tools to create custom SMS subscriber segments based on engagement or on-site behavior. This opens up the possibility of powerful cross-channel marketing campaigns which are automated and highly personalized, delivered via both email and SMS via one tool available in Shopify’s app store

Want to deliver a consistent welcome message, or a sequence, across multiple channels? This can be done in a single automation. Want to follow up with cart abandoners who received an email but didn’t take action? Try reaching them via SMS with the same custom offer before sending your next email a day or two later.

When email and SMS marketing are run in tandem from one tool, retention marketing becomes easier and more effective. So does lead nurturing for new subscribers who are still familiarizing themselves with your brand. 

Klaviyo remains one of the most powerful tools available to brands selling on Shopify who want to capture leads and deliver personalized marketing messages to them via email and SMS from a single dashboard.

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This article is a part of our Leadership Series, which features industry experts sharing valuable insights for small business owners who sell online. The opinions expressed in this contribution are solely those of the author(s).

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