March 17, 2016

Merchandise Categories Matter in Lifetime Value Calculations

Here's a typical story.


Now, let's assume that the customer purchased from Merchandise Category 3 instead of Merchandise Category 1.


#OhBoy.

Let's swap out Merchandise Category 3, moving Merchandise Category 6 in instead.


Now that you know this, there are several things you would be willing to do, right?

  1. You feature Merchandise Category 6 items in your prospecting catalogs (you use prospecting catalogs, right?).
  2. You gladly pay more for keywords from Category 6.
  3. You pay less for keywords from Category 3.




Profit per New Customer

It's common for folks to measure cost per new customer. Total Marketing Cost = $10,000. Total New Customers = 130. Cost per New C...