The increasing number of online retailers on one side and slowing growth of online user population on the other side are the driving forces of change in e-commerce. Number of returning customers is in decline as new competitors are entering the market. Cost of advertising is rising. One-time customers are not profitable anymore so online retailers need to shift focus to retention.
In this talk we'll walk you through the process of building the new framework. We'll deep-dive into data-driven digital marketing framework, explain how to use CRM data to enhance your segments and finish up with case studies expaining how to use the new metrics to identify top customers and maximize your profits.
10. We’ve seen a decrease in Paid Search revenues of up to 80 %!
GENERIC SEARCH IS IN RAPID DECLINE
11. Search is behaving strangely
FREE FALL
Decrease in generic
Branded steady
BRAND TAKING
OVER
Decrease in generic
Increase in branded
GENERICS RULE
Increase in generic
25. Entry barriers offline are
much higher than online
Entry barriers
Number of competitors
Number of competitors is rapidly
increasing
Growth of online user
population is slowing down
Number of users
Returning customers
Number of returning customers
is in decline as new competitors
are entering the market
Cost of advertising is rising and
one-time customers are not
profitable anymore
One-time customers
26. One-time customer revenue stream
CPA
GM CPA <= GM
The only way your business could be profitable is achieving CPA
much lower then your Gross Margin.
27. One-time customer revenue stream
CPA
GM CPA > GM
Due to increased competition CPCs are increasing and CRs are
decreasing.
28. Shift to retention model
CAC
GM
CLV <= CLC
Sum of GM from all customer transactions should be higher then
sum of all costs connected to the customer
GM GM
GM
GM
GM
MRC MRC MRC MRC MRC MRC MRC MRC MRC MRC MRC
CLV
CLC
43. Behavioral
USER STATUS
First-time user, Regular
user
LOYALTY STATUS
Loyal, switcher, lapsed
BENEFIT SOUGHT
economy, quality, service
level, convenience,
access MARKET MATURITY
Early adopter, late adopter,
laggard
44. 12 types of users
https://www.red-orbit.com/blog/12-types-of-google-search-users
45. Cost per Transaction by month
- 24,24%
- 42,43%
- 64,31%
- 68,48%
September October November December January
46. Number of transactions by month
+ 31,88%
+ 51,45%
+ 106,52%
+ 164,49%
September October November December January
47. FOR EVERY $92 SPENT ON USER ACQUISITION,
ONLY $1 IS SPENT ON CONVERSION & RETENTION.
49. Customer clusters
segmented by purchase
behavior, CES & LTV Size of clusters
How are your customers
segmented?
How to use new metrics and segments?
Prevent churn
and re-engage users
based on deviation
in their behavior
Predict LTV
of newly acquired users and
bid accordingly
Customer
transitions
Between clusters
SaaS Ecomm metrics
like churn, retention, ALT, CES