June 30, 2021

We Can't Acquire Customers Anymore

The analysis indicated problems prior to COVID:

  • New + Reactivated Buyers in 2019 = 206,593.
  • New + Reactivated Buyers in 2018 = 247,194.
  • New + Reactivated Buyers in 2017 = 277,550.
  • New + Reactivated Buyers in 2016 = 316,902.
  • New + Reactivated Buyers in 2015 = 334,441.
COVID slowed the problem, allowing this brand to generate 201,006 new + reactivated buyers.

But since February 2021, quantities are once again in free fall.

When I shared the data with the Executive, the Executive said something interesting:
  • "We just can't pay for new customers anymore. The math doesn't work. Paid Search, our primary source of new buyers, is imploding with fewer conversions and more cost. We honestly just don't know what to do anymore. It's exasperating."
COVID masked underlying business challenges. When you force people to sit at home, e-commerce businesses thrive.

The past fifteen years showed us what the future is going to look like.
  • 2006 - 2011 = Catalogers lost significant sales volume to e-commerce brands.
  • 2014 - 2019 = Retailers lost significant sales volume to Amazon / e-commerce brands.
  • 2022+ = Stale e-commerce brands are about to lose sales volume to Amazon, to modern e-commerce brands that cater to younger customers, to Shopify-based brands, and to newer Retail brands moving into abandoned retail centers.
The first place you see negative trends happening is with new+reactivated buyers. Your most loyal customers hang in there with you ... but prospect audiences don't have a history with you ... they just don't care.

So please, monitor your numbers, and as we head into 2022 adjust for your COVID-bump and then analyze underlying trends. If you are struggling with new+reactivated buyers after accounting for the COVID-bump, you need to take action with your customer acquisition programs now in an effort to avoid what the Executive (above) is dealing with.

P.S.: For catalog brands, this means getting away from co-ops.

P.P.S.: For many of us, this is going to mean finding paths outside of Google.

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