Most Valuable Ecommerce Customers Come from Organic Search [Study]
Not all customers are created equal. This is the picture painted by customer acquisition platform Custora in its latest study on ecommerce and the lifetime value of a customer.
The highest value customers come from organic search at a rate of 54 percent higher than the average lifetime value of a customer, followed by PPC and email, according to Custora.
Customer lifetime value (CLV) is a way to calculate the entire profit a company can expect to earn from the relationship with that customer over time. For this study in particular, CLV referred to the amount customers spent within two years of their initial purchase.
“The savviest marketers in the new era of ecommerce will be looking beyond just where customers are coming from,” Custora said in its report. “They’ll be looking at the value of new customers acquired across channels, platforms, and geographies.”
Social media is generally accepted as a common contributor in the path to conversion, and sometimes is the last click or only click in a conversion funnel. However according to Custora, clients coming from social networks don’t stack up against the CLV of clients coming from other channels.
Ecommerce customers acquired through Twitter are worth 23 percent less than the average CLV, the report said:
Not surprisingly, email marketing as an acquisition channel is on the rise. Not too long ago, we saw in another study that email was beating search and social as the largest driver of conversions for ecommerce.
Custora data gives more validity to notion of email as a power channel for marketing and conversions. In fact, according to the report, customer acquisition via email has quadrupled over the past four years in ecommerce.
The data also shows the importance of organic search to customer acquisition as well, which is still higher than email.
Data for this study was collected from 86 U.S. retailers across 14 industries and 72 million customers. Acquisition channels were obtained via the “utm_medium” tag in Google Analytics.