April 05, 2021

The Master Sheet: Comparing Your Customer Development to a Baseline

Ok, it is time for the grand reveal!

Yesterday we talked about Customer Development Indices. We compare how much more responsive 2x (two purchase) customers are than 1x, or 3x vs 2x, or 4x vs. 3x, or 5x vs. 4x.

There are five columns in the middle of the table, forming a heat map. Let's review each column.

  • 1x Rebuy:  Here I index your first-time buyer repurchase rate by recency against the baseline I've developed. A value below 1.000 means your Development tactics result in below-average performance. A value above 1.000 means your Development tactics are above-average.
  • Change 2x vs. 1x:  Here I compare how well your response increases as a customer buys for the second time vs. the baseline I've developed.
  • Change 3x vs. 2x:  Same metric, but for third-time buyers.
  • Change 4x vs. 3x:  Same metric, but for fourth-time buyers.
In the heatmap in the middle of the Master Table, you see three general colors. Green is above-average ... you are doing well. Yellow means you are performing at about average. Orange/Red means you are performing below-average.

Tomorrow we'll talk about what we see in the middle of the table. For today, try to interpret the results and consider what the implications of the findings are.

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