March 04, 2020

It's March, and Those Christmas Buyers are Dormant

I spoke at a conference. One of my slides on File Power criticized customers acquired at Christmas. I made it very clear that when you acquire a customer at Christmas, you make a File Power tradeoff.
  • You earn top-line Christmas sales.
  • You might earn bottom-line benefit before the end of your year.
  • You lose long-term File Power.
  • Without long-term File Power you become a transactional brand who is weakened all year and then pays Google/Facebook $$$ to save the year.
If you've ever had a chance to speak in front of an audience, you know as well as I do that somebody in the audience is going to be offended by what you say, and wants to make sure they "correct the speaker". The conversation goes something like this:


Expert:  Do you really believe that Holiday buyers are worth less?

Kevin:  I've analyzed billions of transactions. I have proof.

Expert:  I must say, I don't believe you.

Kevin:  Why?

Expert:  Well, our brand is kind of unique and special. Our value proposition enables us to harvest Holiday demand efficiently.

Kevin:  You don't even know what you just said, do you?

Expert:  I'm just saying we acquire Holiday buyers at or below break-even, and we can convert them efficiently.

Kevin:  What is the rebuy rate of Christmas buyers in the first half of the year?

Expert:  We don't look at data that way.

Kevin:  Do you look at the data at all?

Expert:  I just think it is short-sighted to criticize brands who harvest Holiday buyers at the time of the year when the fish are most likely to bite.


If you measure File Power, you know the Expert is just plain wrong. The time to acquire a customer is in the 1-3 months prior to a "peak season". If you have a Spring Peak in April, you acquire customers in February / March so that they have a chance to buy again in April. Now you have two purchases from the customer, and guess what? You have File Power! You have a customer who is much more valuable than the customer who buys when the "fish are biting".

You're likely experiencing File Power problems here, in early March. You acquired all of those Chirstmas customers and those customers are just sitting there waiting for 40% off and free shipping. You can't budge 'em. And if you think you can budge 'em, perform your File Power analysis and see if what I'm talking about makes sense to you or not.

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