E-Commerce Marketing 101: Must Know Life-Cycle Marketing Growth Hacks
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E-Commerce Marketing 101: Must Know Life-Cycle Marketing Growth Hacks


Lifecycle marketing is about maximizing the future cash flows of every customer. All businesses will have new customers, active customers and at-risk customers. Lifecycle marketing is about using targeted strategies to reach out and engage these different categories of customers. Customers undergo 5 stages in their interaction with a brand. They start out as ‘Members’ who have registered an online account and provided some personal details. If they find products they like on your site, they may transition into becoming ‘One-Time’ customers. These are people who have made their first purchase. Once you have acquired a new customer, the challenge shifts to retaining them. An ‘Active Customer’ is one who purchases products regularly, and is engaged with your brand. Delivering a product or service with a strong ‘wow’ factor is essential to a loyal following of active customers. When ‘One-Time’ customers are impressed with the quality of your product, they are much more likely to return and make subsequent purchases. That is when they become ‘Active Customers’. If you do not reach out and continuously engage your customers, their excitement with your brand will decay, and some of them will drop-off to become ‘At-Risk’ or ‘Lost’ customers. These are customers who have not purchased something in awhile. The challenge for an e-commerce store is to reel in ‘At-Risk’ customers before they become entirely ‘Lost’. ‘Active’ customers tend to spend the most and are the most valuable to the company. They have the highest Customer Lifetime Value (CLV). CLV measures the expected future cash flows from a customer. You want as many ‘Active’ customers as possible. as they generate the most profit for your company. When we talk about converting customers, We mean encouraging ‘One-Time’ customers to become ‘Active Customers’ by making regular purchases, and sustaining the interest and engagement amongst ‘At Risk’ and “Lost’ customers. Before converting and retaining existing customers, you will need to acquire customers first. With the world plugged into the internet today, there are countless channels to acquire new customers. One big challenge for e-commerce companies is knowing which channels are the most effective, and more importantly, which channels are the most profitable. Customer acquisition is the first step and foundation to building a strong online business. Let us discuss customer acquisition now! Average CLV’ is the average value a customer can bring to you during the time they spend in your store. It is an important metric to customer acquisition. For a profit you need to ensure that customer lifetime value is higher than the cost of acquiring a customer. The best channels for customer acquisition are not necessarily the cheapest ones, you could be acquiring customers very cheaply, but if they are not spending enough at your store, you could still be making a loss overall. Some marketers choose to use first order size to measure how much a customer is worth to the store. However, some customers may make a large initial purchase but stop making purchases in the future. Therefore, customer lifetime value (CLV) more accurately indicates long-term total value of a customer. However, it can be tricky to calculate Customer Lifetime Value (CLV) as you have to predict future behavior. This is where services like Metisa come in. We use advanced data science techniques to model customer behaviour and provide more accurate estimates of future spending patterns.

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