New Customers: Does Quality Matter?

Maybe your data looks like this:

• All Other New Customers:  $20.00 profit in the next year.
• Google Shopping New Customer:  $12 profit in the next year.
• Paid Social (Facebook):  $10 profit in the next year.

When you email me your questions, you'll ask if you should avoid the Google Shopping / Paid Social new customer?

What you should avoid is wasting a lot of money marketing to those new customers. If you can earn a profit acquiring those customers, market to them in the "welcome window" ... the first 90 days after acquiring the customer, then be gentile with your marketing dollars. Don't waste them chasing a customer that is not interested.

I know, this is the point where you suggest it isn't worth acquiring a customer that doesn't want to have a relationship with you. Almost no customers want to have a relationship with any of us. The customer has a need at a point in time. The customer wants that need met.

The quality of a new customer matters in relation to how you manage the downstream relationship. If you can earn $25 profit acquiring the customer and then earn another $10 in the future (whereas a different new customer pays you back $25 / $20), just back off your downstream marketing efforts to that customer.

The average ecommerce brand doesn't have this problem, FYI ... they don't have outbound marketing programs that cost $15/year. This is a decidedly old-school problem.