Let’s discuss one of the most fundamental forces of business growth: the balance between cost per acquisition and customer lifetime value.
According to WordStream, the average website conversion rate across industries is only about 2.35%. For ecommerce companies, it’s 1.84%. These are dismal numbers. At a 2% conversion rate, you need to either be very efficient with your acquisition costs or attract very high-value customers. Or better yet, find a way to bring up your conversion rate.
We’re going to tell you how Velocidi can help you accomplish all three.
Improve the efficiency of marketing spend
with behavior-based audiences and deep insight into channel performance.
The first step is to grasp which marketing channels (or combination of channels) are bringing in your highest value customers. We start by implementing a 1st-party tracking cookie that identifies the different channels your visitors use to reach your website.
You can then segment your audience according to how your customers interact with you across channels. For example, you’ll find that some customers are clicking on your emails, but never reach your website via social media. That gives you an opportunity to reduce spending. You can scale back social targeting to this group, and refine your email campaigns to improve efficacy.
Velocidi also gives you the tools to analyze campaign performance at the aggregate level. By lining up your event-level customer data with your aggregated campaign data, you can dig into how the two can inform and impact each other. You need both to develop a complete picture of the customer journey and understand where the critical touchpoints are.
by tailoring offers to individual purchasing patterns.
Velocidi has built-in tools to segment people by average order value, whether they only purchase when offered a discount or free shipping, CLV tiers, and more. These help you optimize customer experience and increase the likelihood to purchase on an individual level. They also help save costs by only offering free shipping and discounts to customers that won’t close the deal otherwise.
Gaining first-hand insight into purchasing patterns also helps you adapt when patterns inevitably change. You probably have customers who periodically shop for people other than themselves. Or customers whose purchase preferences shifted due to a change in their lives. The CDP helps you keep up by recognizing the signals in your data that indicate these changes. Moreover, it enables you to adjust your product recommendations and offers accordingly to keep their business.
Streamline path-to-purchase and increase conversions
by modeling new customer behavior against existing customer data.
The robust foundation of 1st-party data collected with the CDP gives you all the information needed to convert new customers. After all, new and existing customers already have one crucial thing in common: they are shopping in your store. The optimization is in treating your store visitors like people you already understand, instead of like strangers who may or may not convert. By comparing their behavior with your existing customers you’ll be able to anticipate their needs and deliver a better experience.
Before a new customer makes their first purchase, they already give you some clues you can use to infer their preferences. Which channel they came from, the search terms and filters they use, which items they click on, can all be matched to existing customer data to build an initial assumed profile. Think about Amazon’s “customers have also bought…” feature, and place it earlier in the customer journey, before any purchase decision has been made. The CDP uses predictive modeling to decide which product recommendations will best match the new customer. That helps the customer find what they need faster, and improve their overall satisfaction.
But above all, build trust with your customers.
Trust is the currency of commerce. Even though we are talking about hard data, behind it all is real people with whom you need to build a trusting relationship.
A recent study by Salesforce proves how trust impacts customer relationships. Their findings:
- 86% of consumers surveyed said they’re more likely to trust a company with their personal information if it explains how that information leads to a better customer experience.
- 86% said that if they trust a company, they’re more likely to share their experiences.
Delivering personalized experiences requires that your customers trust you with their personal data. This is one of the reasons we offer our CDP as a private solution. It places the brand in the position of sole controller of their customer data. The level of control our Private CDP brings enables you to be fully transparent with your customers about what data is collected and how it is used. And it allows you to manage consent and adjust both your website experience and your media targeting accordingly. With this level of transparency, you can empower your customers to be actively engaged in the data relationship they hold with your brand.
Empowered customers are loyal customers. And loyal customers grow your business.
Contact us today to talk about how Velocidi can accelerate your business growth.
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