The Istobe eCommerce Analytics Blog

Customer Lifetime Value is the most critical metric in determining how healthy your customer file is. Why, then, does traditional CLV analysis perform so poorly for online retailers?

Consider two customers: The first bought an item for $40 two years ago and hasn’t returned to the site since. The second has not yet bought anything but visits the website every day and eagerly clicks on marketing emails. Traditional CLV, which relies purely on past purchase behavior, says customer 1 is worth more than customer 2 but that’s unlikely to actually be the case.

Read The 3 Biggest Factors You’re Not Considering in Customer Lifetime Value »

With so many reports out there talking about why retailers are going to be taking such a hit this year, I thought it might be worthwhile to focus on the positive. The down economy has opened up several opportunities for retailers to try out new and interesting ways of reaching their customers.  I wanted to share a few of these with you.

• Read Surviving the Holidays: 5 Marketing Tips for Retailers »

Everyone agrees that SMS marketing - text marketing - is growing by leaps and bounds. A new Verisign report notes that SMS traffic will grow to 5.5 trillion - yep, trillion - over the next four years and that messaging from businesses increased by 115% last year. This codifies even further what is obvious to most: SMS is the next big direct marketing channel. Sure, there is A2P, P2P, and MMS to boot. But, for now, let’s limit this conversation to SMS and how your company can enter this channel with a flourish.

Read Mobile Marketing - Five Steps to Start the Art and Master Targeted SMS »

As you can tell from our blogs, we’ve been very social media focused this week. We’ve actually been watching the space for quite a while now, but recent events have really shown how the power of social media has changed the thinking of the mainstream marketing crowd. I’m sure many of you are aware of Motrin fiasco where women (and men) on Twitter expressed outrage at the portrayal of moms by the ibuprofen company (“Motrin moms,” a-Twitter over ad, take on Big Pharma–And win).  Additionally, many political pundits have credited Obama’s success with winning over 18-35 yr olds to his use of new and more cutting edge marketing mediums. The power of social media has certainly been proven out, but does your company need to worry about it and, if yes, how do we take advantage of it?

Read Twitter Me This: How Do Businesses Take Advantage of Social Marketing »

Continuing our research into how to navigate the social and micro-blogging networks, specifically twitter, I want to dicuss the various sites and tools which can be used to draw a map of the twitterverse.  The tools fall into categories of search and survey.

Search. Like every other internet based network there are several solutions for searching the twitter world.  Each search tool is oriented towards a specific goal.  For searching against keywords there are 2 good options: Twitter Scan and Monittor.

Read Twitter Analytics »

(Read the entire Customer Analytics: A Guide to Getting Started series)

In our last installement we tested offers to likely and unlikely buyers to gauge reaction. Let’s now use the results of this test to determine if we are being too timid or aggressive with our probability to buy cutoff percentage.

Read Customer Analytics: A Guide to Getting Started (part 7) »

By now, direct marketers need to acknowledge that Twitter is here to stay and constitutes a new marketing channel altogether. However, that doesn’t mean that every company needs to go out and establish a Twitter strategy. After all, not all of the companies in the world have a customer demographic that overlays nicely onto Twitter’s. But as a business tool for retailers, the protracted success of Dell and Woot, to name two, proves that when harnessed well, Twitter is a great way to educate potential and current customers about your company and your products.

Read Twitter for Business - A Starter Kit of Links for Would-Be Twitter Marketers »

Ad Age reports on a Shop.org study that shows 45% of online retailers are significantly increasing their budget for free shipping this holiday season.  It appears that, this holiday season, everyone is a defector in the prisoner’s dilemma that is free shipping.  

We’ve always advocated holding firm on shipping charges but the tide is simply too strong to resist this holiday season.  Instead, consider a way to minimize the damage.

Read 45% of Online Retailers Increasing Free Shipping Budget for Holidays »

With today’s news peppered with articles about the possible demise of Circuit City, the sinking Dow, and the continued decline in consumer spending, many companies are concerned about how their customers are going to respond to the tough times ahead. Several online retailers are already going down the discount path to try and get customers to spend their money early– well before their credit dries up. I’m sure many of you have already been hit up like I have with numerous discounts from shops that don’t typically give discounts – I’ve been surprised by the recent emails I’ve received from the likes of JCrew, a company that never seems to discount their merchandise.

Read Finding Customers Who Will Weather This Storm: Customer Segmentation in a Down Economy »

We write a lot about email on this blog and that’s largely because our clients tell us that the product predictions that come out of our customer prediction database makes the most monetary difference when used for email relevance. (It’s hard to argue with the 64% increase in revenue per email that we get with those predictions.) But the email-centricity is also indicative of the Baby Boomer and Gen X markets that our clients serve. And now that we’ve started to engage with companies that cater to younger markets (namely Millennials), we’ve gotten a chance to deal with newer communication channels (namely SMS text). SMS text marketing is arriving sooner than we’d ever imagined. And I have four numbers that prove it.

Read Four Numbers that Tell Me Why SMS Marketing Is About to Blow Up »