February 22, 2021

Utterly Beautiful

I could look at this image all day long (to which you might say, "Get a Life, Kevin"):

The image highlights a bit of knowledge that is Central to Customer Development ... "Customer Value Decays".

It's easy to see it when looking at a first-time buyer. Immediately after a first purchase, the customer has a 24.4% chance of buying again in the next year. If the customer doesn't buy that month, the probability of a purchase in the next year drops to 18.6%. Nearly 25% of the future buying potential just disappeared ... after only one month. That's why the Welcome Program is so darn important.

From there, the customer just keeps on decaying. Merchandise will keep the customer interested, no doubt about it. But Marketing plays a huge role in keeping the customer interested. There's the operational stuff like search, there's the owned stuff like email marketing and website personalization, there's content-related entertainment on Instagram and YouTube. All of it matters. You matter!

To me, the table is utterly beautiful.

Tomorrow we'll look at this table again, reviewing loyal buyers.

The day after? We'll compare this company to another company.

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