👉 Background: Shein is the fast fashion retailer that was founded in China back in 2008. While it's been around for more than a decade, its real glow-up happened in 2020 when TikTok creators started flooding our feeds with #sheinhaul content. Shein is known for on-trend, cheap, dupey clothing that comes and goes real fast. In fact, Shein releases an average of 2,000 new items added to its store daily, or in some days, it’s up to 9,000 new items released.

‍👉 What happened: Now, Shein has announced that its Australian revenue in 2024 jumped to $1.23 billion - the first time it has broken through the $1 billion mark after a 25% increase in revenue year-on-year. To put that into perspective, it means that Shein Australia is now generating more revenue than home-grown Accent Group, which owns Hype, Platypus and Stylerunner.

‍👉 What else: Shein Australia wasn't just growing its revenue though - it also saw a 30% jump in its profit too — to just over $15 million. The reason? A large number of their customers have returned to the store again and again in the same year. And that means Shein is growing their customer lifetime value.

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‍What's the key learning?

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‍💡Customer Lifetime Value (CLV) is how much money a business can expect to make from a single customer over time. It's an essential tool for consumer brands because it helps them figure out how much they can afford to spend on acquiring new customers.

💡For Shein, their CLV is going up fast thanks to its huge number of loyal Aussie shoppers. In fact, 42% of their customers are buying from the online store multiple times a year.

💡Each repeat customer costs less to acquire and brings in more revenue and Shein pulls them in with the cheap prices. But then keeps customers coming back with constant new arrivals, and “limited time offers” driven by its algorithm — classic case of: low margins and high volume.