How to Avoid Wasting Customer Acquisition Dollars
Do you know how many days you have to get a new acquired customer to make a second purchase before it’s too late? If only there was a simple answer that applied to all businesses. But, there’s not. You’ll want to understand the actual behavior of your customers, not rely on a gut-level belief of how much time you have. For some, a guideline of three or six, months without any email open or click activity at all – means the one time customer is inactive. For others, it could be that the seasonal nature of the business means a customer who purchases once a year is engaged and active. Here’s how to go about…
October = A ‘Must’ Month for Customer Acquisition
Don’t have time to invest in customer profiling? Then, take a look at customer behavior based on season and you’ll find that October is a great month to acquire customers. We’ve looked at a number of real-world data sets from online retailers in diverse businesses and have found an interesting fact – from September through March, October is the best month to acquire customers and have them return to make additional purchases. Since we’re always looking to make our acquisition dollars count, acquiring customers who are more likely to purchase again should be an objective of marketing. Now, the indicator that customers who make their first purchase in October are likely to purchase again makes…
How to Use Marketing Contribution & Profiling for Promotion Evaluation
We’ve talked about how to calculate promotional offer profiles, and we’ve talked about the using marketing contribution margin as the point of comparison between Customer Acquisition Cost and Customer Retention Cost. Here is an approach to combine concepts in the two analyses to learn more about the effectiveness of your promotions. Marketing contribution margin takes into consideration product cost, customer support, returns and cancellations, as well as fixed and variable marketing expenses. Allocate your fixed and variable marketing costs by order for this analysis. How to evaluate the performance of promotional offers: Identify all of the orders which include a promotional offer. Group the orders together by individual promotion, so you will be able to…
Business Intelligence for Online Retailers
October = A ‘Must’ Month for Customer Acquisition
Don’t have time to invest in customer profiling? Then, take a look at customer behavior based on season and you’ll find that October is a great month to acquire customers. We’ve looked at a number of real-world data sets from online retailers in diverse businesses and have found an interesting fact – from September through March, October is the best month to acquire customers and have them return to make additional purchases. Since we’re always looking to make our acquisition dollars count, acquiring customers who are more likely to purchase again should be an objective of marketing. Now, the indicator that customers who make their first purchase in October are likely to purchase again makes…
How to Use Marketing Contribution to Calculate the Minimum Number of Acquired Customers
Recently, we received the question, “I’d like to know how to make trade-offs between two optimized promotions so that I acquire enough customers to grow the business while tapping into the profit that repeat customers bring to my online retail business.” This can be tricky, and it really comes down to the corporate objectives and, let’s be frank, how your own success as a marketer is evaluated. Customer acquisition and customer retention targets can be balanced to meet company objectives. If an online business needs an immediate infusion of top-line revenue and margin is not the priority, a deep discount promotion which targets new customer acquisition may be completely acceptable. More likely, some level of…
