It’s fitting that the Magento Imagine 2017 conference kicked off with a session about using data to drive strategies for online growth. Robert Moore, Head of Magento Business Intelligence, shared insights and findings on the analysis of sales and customer data across hundreds of online merchants.
The focus was on identifying what top growth performers look like and the data points that help define that growth.
Two big takeaways I found compelling:
- Top Performers outpaced other competitors in revenue in the first 36 months of online selling.
- Top Performers acquire 2.5 times more customers than other competitors also in the first 36 months of online selling.
3 Data Points to Determine if You Are a Top Performer
1. Customer Acquisition
This goes beyond looking at site traffic. This requires pulling data together across multiple sources such as transactions, PPC, and any other meaningful data that will allow you to do customer segmentation.
2. Customer Retention
Repeat purchase behavior over time provides valuable insight into how to determine customer retention. Robert shared that the companies reviewed over a 36-month time frame showed that only 32% of customers make a second purchase. What’s interesting about that stat is that 53% of those repeat buyers buy a third time. Revenue from repeat customers over the course of a 36-month period outpaced new purchases across that same time frame. What does your data during the last 36 months tell you?
3. Customer Lifetime Value
Many dimensions can be looked at to determine lifetime value (AOV, what was purchased, where it was purchased etc.). It is the combination of these dimensions along with deep segmentation of customer purchasing behavior that makes it meaningful and actionable.
As companies look to invest in driving more qualified traffic, a first step should be to invest in the people, process, and technology to mine and gain insights on existing customers.
