Recognizing the elephant in the room
How the best customer analytics solution can fail if you ignore what it’s telling you.
Many marketers are ignoring the biggest problem with their existing customer analytics based marketing, their large number of one-time buyers. For most catalogers and online merchants, that number is often 50% or more. Are they the biggest segment in your database? When you count, just look at your active file, typically those customers who have made a purchase in the past 12 or 18 months. If you go out further, the percentage of one-time buyers is usually even bigger.
Large numbers of one-time buyers are a problem because they represent an untapped and mostly wasted resource. Again and again, they fall into a marketing Bermuda triangle:
- Acquisition teams ignore them — they’ve already been captured
- Existing customer marketing teams send an initial flurry of campaigns at the buyer right after the purchase, often without any real data on what to offer, and usually with little success
- Thereafter existing customer marketing teams also ignore them, preferring to concentrate on multiple order buyers.
We know from experience that getting the second sale, turning that buyer into a customer, is a solvable problem that yields to a systematic customer analytics process. Companies have at least three data points that can help to get that second sale:
- What the initial purchase was
- Most likely next purchase
- Time since first purchase
While not as rich a data set as available when campaigning to multiple order customers, it is more than enough to run effective campaigns.
So where is the logic in ignoring half of your customer population? You are leaving a lot of money on the table by ignoring the elephant in the room.