October, November, and December are full of special events that your ecommerce brand can leverage to win more customers.
Themed marketing for Halloween, Thanksgiving, Christmas, and New Year’s encourages a wealth of customer acquisition. The Black Friday and Cyber Monday period is the biggest ecommerce sales event of the year. And even minor holidays like Hanukkah can be a great opportunity to boost ecommerce revenue for candle manufacturers and other niche brands.
These new customers can bring a significant amount of money to your business throughout the year. But to get the highest possible value, you need to maintain and nurture them so they become repeat customers. Follow our three simple steps for what to do with your new customers from Q4 to grow your business effectively in the coming year.
Step #1: Setting goals for your key performance indicators
Before we look at how to maximize the value of your customers, it’s important to understand how to measure your success. By setting specific goals and monitoring changes in your key performance indicators (KPIs), you can evaluate whether your remarketing efforts are actually boosting your revenue. That means you can move forward with confidence or tweak your approach to improve performance.
There are three KPIs that are particularly relevant to nurturing your new customers from Q4: returning customer rate, average order value (AOV), and customer lifetime value (CLTV).
Returning customer rate
This is a measure of how many existing customers made two or more purchases within a specified time period. To calculate returning customer rate, divide your number of returning customers by your total number of customers, then multiply by 100 to get a percentage.
Most ecommerce businesses aim for a returning customer rate of 25-30%. The KPI dashboard service Geckoboard advises that if your returning customer rate is close to 50%, you should invest more in marketing to attract more customers. And if your rate is less than 25%, you should actively retarget one-time customers to encourage repeat purchases.
Average order value
This metric refers to the average total value of every order placed within a certain timeframe. Simply divide your total revenue by the number of orders you receive to calculate your AOV.
The AOV of each ecommerce business will be different. Some sell a small number of high-value products, whereas others sell many low-value products. For example, data from Dynamic Yield showed that in November 2023 the AOV of Home & Furniture was $252, while Beauty & Personal Care was $85.
Regardless of your AOV, one thing remains consistent across all ecommerce niches. An increase in your AOV is always a good thing, as long as your number of customers doesn’t go down.
Customer lifetime value
The total amount of money you get from a single customer over the course of their relationship with your business is referred to as CLTV. It’s slightly harder to calculate than returning customer rate and AOV, but not by much.
First, you need to work out your customer value, which is how much a customer feels your brand is worth to them. To do this, multiply your AOV by your average number of purchases per customer.
Then, multiply customer value by average customer lifespan with regards to your business to find your CLTV.
A good benchmark for CLTV is 3x your customer acquisition cost (CAC), which is how much you spend on average to acquire a new customer.
The average CAC among ecommerce businesses is $70. So the average benchmark for CLTV would be $210. But as with returning customer rate and AOV, the target for CLTV will differ from business to business.
Step #2: Enriching your customer data
Recognizing your KPIs lets you set realistic goals for nurturing new customers from Q4. But before you can create a remarketing plan, you also need to gather more specific information through data enrichment.
Data enrichment is the process of building upon your existing customer data with additional information. Doing so means you can better target and personalize your remarketing efforts, making them more effective and therefore more profitable.
Let customers tell you more
A customer’s age, location, buying habits, opinions, and other personal data is invaluable for sending them relevant and resonant remarketing messages. And if you simply ask for it, customers tend to be more than willing to give it to you.
You can get a customer’s basic information and contact details by asking for them when they set up an account. And even if they don’t make one, you can still request it through lead capture forms for newsletter subscriptions, discount offers, and free gift opportunities. Reviews, feedback, and purchase histories also give you explicit information on the types of products customers prefer.
Tag customers in groups
Customers have different buying habits, preferences, and needs. That means remarketing efforts that influence some customers might be completely ignored by others.
Tagging customers allows you to categorize them into useful segments based on their characteristics. You might tag them by geographical location, the products they buy, whether they’re a new or repeat customer, or any other data you can gather. This lets you create different remarketing campaigns with messaging tailored to each group, improving your ability to nurture customers and incentivize additional purchases.
Step #3: Create your nurturing strategy
Now that you’ve set goals for your KPIs and enriched your customer data for pinpoint targeting, it’s time to launch your nurturing strategy. Through a combination of emails, ads, social media outreach, product recommendations, and other tactics, you can convert new customers from Q4 into repeat purchasers.
- Leverage your lists in ad platforms to retarget/remarket
- Ensure your 7 core flows are activated to maximize your list value Flows like abandoned cart, abandoned browse, cross-sell/up-sell and welcome flows will be essential to converting this first time traffic over and over.
- Send regular marketing emails to your newly-grown list to promote product purchases and other bottom-funnel conversion actions.
But many ecommerce businesses don’t have the time or money available to invest in a successful nurturing strategy. This is especially true if you lack a dedicated marketing department with the specialist skills needed to generate the most value.
To fill these gaps, ecommerce brands across the US come to LimeLight Marketing. Our expert team uses your KPIs and customer data to inform omnichannel marketing strategies that are proven to grow your business. Our successes include:
- Turning a $400k apparel brand into a multi-million dollar revenue stream
- Doubling channel revenue in 60 days through email + SMS optimization
- Achieving a 134% year-over-year conversion volume increase for the largest private business in America
Chat with us now to find out how we can turn your new customers from Q4 into lifelong brand supporters and skyrocket your annual revenue.