In a recent video, ecommerce founder Jordan shared how his eight-figure brand nearly collapsed, not because of a lack of sales, but because of constant discounting.
It’s a trap many ecommerce brands fall into. Spending thousands of dollars on customer acquisition each month while training their best customers to only buy when there’s a discount.
At Smile, we see this pattern constantly. It’s the single biggest mistake holding brands back from building a profitable retention engine and it’s rooted in three outdated paradigms that most teams don’t even realize they’re operating under.
1. Discount Dependency is Not a Retention Strategy
The first paradigm Jordan discusses is the belief that sending out frequent discount codes or flash sales drives loyalty.
In reality, this approach trains customers to become coupon hunters instead of genuine brand advocates. Once shoppers know you’ll discount, they’ll wait for the next sale, which kills your baseline conversion rate, erodes margins, and undermines brand equity.
As Jordan put it, even brands doing $200k a month can find themselves stuck working 80-hour weeks with razor-thin profits simply because they’re addicted to the “discount drug.”
Top-performing ecommerce brands take a different approach. They build strategic value exchanges that increase purchase frequency without cutting into profits like loyalty perks, limited-edition drops, early access, or personalized gifts.
These experiences drive repeat purchases and strengthen emotional connection the foundation of sustainable retention.
2. Loyalty Programs Fail When Treated Like Discount Machines
Another misconception Jordan highlights is that loyalty programs automatically improve retention. In reality, most fail because they’re treated as organized discount systems instead of what they should be: relationship-building engines. True loyalty comes from emotional connection, not transactional rewards.
The top 1% of ecommerce brands understand that their best customers:
- Want to feel special, not just save money.
- Value exclusivity more than discounts.
- Respond more to recognition than coupons.
That’s why the most successful programs go beyond points adding layers like anniversary badges, exclusive product access, and milestone rewards that celebrate customer journeys. By using loyalty data to personalize post-purchase experiences and build emotional touchpoints, brands can turn casual shoppers into lifelong advocates.
3. Retention Isn’t an Add-On It’s the Foundation of Growth
The final paradigm is the idea that retention is a marketing tactic you “bolt on” once acquisition is figured out. But as Jordan points out, this is like painting over a cracked foundation. Retention should be the core operating system of your business, the engine that compounds results across every channel.
When you intentionally design for retention, you:
- Reduce reliance on paid acquisition
- Increase lifetime value
- Unlock more predictable, profitable growth
That means mapping every customer touchpoint, integrating data across email, SMS, and loyalty platforms, and using insights to deliver value throughout the customer lifecycle not just at the point of sale.
Why This Matters Now
Customer acquisition costs have skyrocketed, and they’re not going down anytime soon. The brands that win in the next era of ecommerce will be those that scale through retention, not discounts.
As Jordan emphasizes, every existing customer is an investment in your future growth. The longer you keep them engaged, the higher their lifetime value and the more efficient your entire funnel becomes.
It’s the compound effect of retention: the more value you deliver post-purchase, the faster your brand grows without increasing spend.
Building Your Retention Engine
If you’re ready to move beyond discount-based marketing, start by rethinking how you deliver value. Loyalty shouldn’t be a cost center, it should be your most powerful profit engine.
With Smile, you can launch a Shopify loyalty program that’s built for retention from day one.You’ll get:
- Proven templates that drive repeat purchases without discounts
- Seamless integrations across Shopify, Klaviyo, and your existing stack
- Data-driven insights to personalize experiences across channels
Over 100,000 brands use Smile to build sustainable growth through retention, not endless acquisition.
Start your free trial today and start building a loyalty program that compounds customer lifetime value.
