Customer Metrics, and How to Move Them

Posted by James Dunford Wood 19 Apr 17

key customer metrics for ecommerce marketers Two of the most common questions I get asked by online retailers I work with  are:

“What customer metrics should I be tracking?”

“Which ones should I be looking to influence?”

Typically most ecommerce managers and digital marketing managers will be tracking top line metrics like revenue per marketing channel and conversion rate, but it is surprising that the ones who are tracking metrics such as repeat rate, new customer revenue and time to second purchase are still in a minority.

These are all crucial metrics to be looking at, and if you can optimise them the long term health of your business can be greatly enhanced.

So let’s break them down.

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Topics: Ecommerce metrics, Ecommerce customer retention, Ecommerce marketing tips, Ecommerce customer acquisition, ecommerce welcome email

How to Calculate Cost of Customer Acquisition (CAC) in Ecommerce

Posted by Edward Gotham 2 Mar 17

Cost of customer acquisition ecommerceThe customer acquisition cost (CAC or CoCA) means the price you pay to acquire a new customer. In its simplest form, it can be worked out by:

Dividing the total costs associated with acquisition by total new customers, within a specific time period

Do not get this metric confused with cost per action (CPA), as there is a strong distinction between the two. In ecommerce, cost per action is typically the amount you pay to convert a customer (i.e. to make a sale), but this relates to both new and returning customers.

CAC is all about acquiring new customers. See how even Google refers to CPA as ‘the cost you are willing to pay to make a conversion’ NOT to acquire a new customer.

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Topics: Ecommerce metrics, Ecommerce marketing strategy, Ecommerce customer acquisition

How to Calculate Customer Lifetime Value (CLV) in Ecommerce

Posted by Edward Gotham 24 Feb 17

Customer lifecycle value What is customer lifetime value?

We all stumble through life clutching onto the fuzzy memories of those pesky Pythagoras and algebraic theorems that haunted many a youth, andwith rare use cases in present day lifethey normally end up getting filed and forgotten. 

Enter customer lifetime value: the only equation you need to remember.  

In ecommerce, CLV is the value a customer contributes to your business over their entire lifetime at your company.

The main methods of calculating CLV are split between historic and predictive CLV:

  • Historic CLV (Good indication of CLV)  

    Simply the sum of the gross profit from all historic purchases for an individual customer.

  • Predictive CLV (Great indication of CLV) 

    A predictive analysis of previous transaction history and various behavioural indicators which forecasts the lifetime value of an individual. As long as the equation is accurate, this value will become more accurate with every purchase and interaction.

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Topics: Ecommerce metrics, Ecommerce marketing resources, Ecommerce customer retention, Customer lifecycle marketing, Ecommerce marketing strategy, Ecommerce marketing tips

7 email A/B tests every ecommerce marketer should try out

Posted by Abi Davies 16 Feb 17

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This blog post accompanies our latest ebook: 15 A/B testing ideas for ecommerce email marketers. Click here to download.

It’s 2017, and the days of low-quality, irrelevant marketing messages are well and truly over; if your email doesn’t seem interesting to a recipient, it will be deleted, unsubscribed from or - dare we say it - marked as spam.

As a result, it’s of critical importance that your email marketing is crafted in such a way that it actually resonates with your subscriber list on a personal level.

The only way to know how your email marketing is *really* performing right now is to look at the numbers. The numbers don’t lie. If they are good, that’s great, but if they’re not so good, changes are probably needed (for some context, the average open rate for ecommerce email is 16.75% and the average click rate is 2.32%).  

Fortunately, A/B testing can help you go about making those changes. 

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Topics: Ecommerce metrics, Ecommerce email marketing, Ecommerce marketing tips, A/B testing ecommerce,

How to Calculate Repeat Purchase Rate in Ecommerce

Posted by Huw Jenkins 21 Jul 16

repeat customer rate ecommerce

Put (very) simply, the repeat purchase rate is the proportion of customers that have shopped more than once.

In a nutshell, repeat rate shows you the percentage of your current customer base that has come back to to shop again: a metric which is influenced by your efforts at customer retention and is a pretty good measure of loyalty, often taken into account by marketers to evaluate performance. 

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Topics: Ecommerce metrics, Ecommerce examples

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