July 16, 2012

Visits Between Purchases

Way back in the day, I worked at Avenue A.  This was in 2000, the wild west days of the internet. I was granted stock options that were worth $2,000,000.  Three months later, my stock options that were worth $0.  Fun times.


We cookied client websites.  We knew that in e-commerce, the average customer visited the website three times before buying something.  We knew that this rule held for a customer on a first online purchase, and on a fifth online purchase.


Not much has changed in twelve years.  At first, an unconverted visit was viewed as a catastrophe.  You had to execute "retargeting", or the more aptly named but equally invasive "remarketing" programs to "win back" customers.  Trade journals, bloggers, ad folks, and analysts love these things.  Customers?  Not so much.


We realized that the programs worked, but didn't move the needle.  It's like improving an email marketing program where 1 in 700 buy something to 1 in 640 buying something.  It's a nice improvement, but it is meaningless in terms of overall impact on customer behavior. 


Eventually, marketers embraced these unconverted visits as a sign that the customer was "engaged" with our brand.  We convinced folks that it was good to spend money on outcomes that yielded no sales whatsoever.  It's kind of like buying somebody a drink at a bar, then the person leaves and we say, "well, we engaged the person for fifteen minutes, so that counts for something!"


Half of the marketing world wants you to spend more money to get that customer to convert.


Half of the marketing world wants you to spend more money to engage the customer without a purchase.


All of the marketing world wants you to spend more money.


At Nordstrom, we had a "3/2/1" rule ... for customers who bought online and in stores, we observed that the customer visited the website three times a month, visited the store two times a month, and purchased once a month, 85% of the purchases happening in-store.


Maybe we just realize that customers "do things".  Maybe we don't have to spend money on retargeting.  Maybe we don't have to spend money to encourage engagement.  Maybe we just accept that the customer is going to do what the customer does, and we simply focus on providing a great experience coupled with great merchandise.


Imagine that?

2 comments:

  1. Hello ! Does the rate of updates of your portal depend on specific things or you compose blog articles when you have an inspiration or free time on that? Many thanks in advance for your reply.

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  2. I tend to write blog articles when I have time and/or inspiration, then schedule them a few weeks out.

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