Grids

You probably have a "grid" of customer response posted in your cubicle, right? The grid looks something like this.


For an "average" month, the grid shows you the probability of repurchase (in the next month) for a customer with specific Recency/Frequency attributes.

And quite honestly, all of the secrets of your business are embedded within this table. 

The table allows us to follow a cohort of customers over time - we get to see how the customers evolve/change as time progresses.

Tomorrow, we'll follow a cohort of customers who just placed a first order.


This week, we're going to learn why almost all of your marketing efforts should be focused on your 0-3 month buyer file or on customer acquisition activities, ok? I know, I know, your vendors are going to tell you how critically important it is to "win-back" a lapsed buyer. Well, that's how THEY make money. You generate profit by focusing on quickly converting 0-3 month buyers. Make sense?

P.S.: Think about this for a moment. Let's say you work with a vendor for 2-3 years, and then you stop working with them. When does the vendor spend the most time with you? The vendor spends the most time with you when you are in 0-3 month status - often trying to get you to cross-over to other products. How often does the vendor reach out to you after you stopped working with the vendor for two years? So yes, vendors are practicing the very tactic I'm going to focus on this week.