What’s the only thing better than customers? Repeat Customers. According to the book Flip the Funnel the conventional wisdom is that it is far more expensive to acquire new customers than it is to retain existing ones. Many companies now base their strategy on increasing purchases from repeat customers, which in the case of Zappos is 75% of their business (again from the book Flip the Funnel).

You should be able to get repeat customer metrics directly in your e-commerce order system. If you have a Yahoo! Store, you can get a baseline metric by pulling up the Repeats report. This will show you the number of customers who have placed multiple orders. You can then divide this number by the number of total orders to get the percentage of repeat orders.

In this example, 159/3511 = 5% of orders came from repeat customers. This metric will probably not change that much over short time periods, but I would check it from time to time – perhaps on a monthly or quarterly basis. Are you able to do a better job of retaining your existing customers?

From a web analytics perspective, what I would like to examine is the behavior of repeat customers vs one-time customers vs non-customers. Are repeat customer behaving differently than other segments? Is there anything I can do to target one-time customers to get them to become loyal customers?

To address some of those questions in your web analytics you’ll have to be able to query your e-commerce order system and tag your visitors appropriately, eg as “new customer” or “repeat customer”, at the time of ordering. Implementation approaches will vary depending on your e-commerce platform, but web analytics tools such as Yahoo! Web Analytics or Google Analytics allow you to set custom variables so that you can track these customer segments.

Once you have set up your tracking, what does the data tell you? One of the first questions I would ask is how repeat customers come back to your site. Are they coming back because they know your brand and therefore type in your brand name in a search engine or visit your site directly?

My take so far is that unless you proactively target and try to get more repeat customers, don’t expect repeat customers to behave differently than one-time customers. You will have to work just as hard as getting new customers to get repeat customers in your search marketing campaigns. You will have to earn their business again every time by competing for non-branded terms:

In this example, the new and repeat customer segments show virtually no difference.

Could you be doing a better job of targeting your one-time customers either directly on your site or via email campaigns so that they become loyal repeat customers? Do you have a great process in place once customers place an order or when they call your customer support number?

Hopefully over time you will find that loyal customers will come back directly to your site thereby lowering your direct SEM costs. And finally I should mention that I have not even taken into account other advantages such as word of mouth and referrals from your loyal customers that should help to lower your overall marketing costs.

In April 2009 Google announced a change to the referrer information coming from Google organic searches. The interesting bit to many people was the addition of the cd parameter, which is the actual search results position. There are a few ways you can see the keyword position in your web analytics, such as with filters, custom variables or event tracking. I personally like event tracking in Google Analytics, and before the change in referrer information we were at least able to see the page a keyword was on.

I thought it would be interesting to revisit this topic from a web analytics/optimization perspective.

1) I estimate that about 10% of Google organic searches have the new referrer information. I have not detected a significant change over time.

2) Number #1 ranking gets by far the most clicks, followed by #2 and #3. Positions #4 through #8 seem to get similar clickthroughs, and from position #9 on down traffic drops significantly. Nothing too surprising here and mirrors what we see on e-commerce section pages: visitors tend to click from top to bottom.

A number #1 ranking however doesn’t mean much if it is unqualified traffic that doesn’t convert. From an optimization perspective, how about segmenting your data to show only traffic from top ranking keywords that doesn’t convert?

Then check keyword landing page combos to find such underperforming keywords and their respective landing pages.

Another way to look at it is to say that you have done all you can from an SEO perspective, can’t get higher than #1 ranking. Now it’s up to your site to convert those visitors. Or you are targeting the wrong keywords in your SEO efforts.

Happy Holidays!

Slightly off topic, but I couldn’t help being affected by Michael Arrington’s riff on Sprint: "Sprint Sucks And Their New Website Is Stupid". The Techcrunch blog has hundreds of thousands of readers and Michael has a huge influence in and around Silicon Valley. Talk about the power a single person can have…How much money will Sprint lose as a result of this blog post?

Just goes to show that you cannot hide anymore on the Internet with "smart" marketing or dodgy fine print. You either have a good product and customer service, or you don’t. With the power of blogging, forums, review engines and social networking, the "truth" will come out.

On the Internet ideas are quickly spread and adopted. Somebody comes up with something new and then others follow, and whatever that "something new" was becomes part of conventional wisdom, rarely to be challenged again.

For instance, why would you nowadays write something like "Welcome to my online store" or "Welcome to the customer service department"? To write "Welcome to…" seems so outdated and is just irrelevant to site visitors. And of course it might be taking the place of another much more relevant keyword. I chalk this down to conventional wisdom, i.e. that this sort of writing goes unchallenged.

"Welcome to…" also implies the notion of "site" vs "page". It’s about pages, folks, not sites. The major search engines index pages not sites. Many visitors may only visit one page on your site, and leave if they don’t like what they see; they don’t care about your site, just whether this one page answers their questions or not.

Google has about 32,900 Yahoo! Store pages indexed with "Welcome to" in it.

Had the pleasure of seeing Rob Snell in action at SES last week. Apparently Rob was pulled in at the last moment to participate in the "Pimp my site" session as the site being pimped out was a Yahoo! Store. He looked very comfortable in this role, despite (or perhaps because of!) his attire…Bottom line is that he did a great job plugging the Yahoo! Store platform to a big audience.











Shirley and Danny Sullivan next to Rob.

Cheers,
Michael

I was going to comment on a free e-book you get from Web Side Story, but I got stuck on the landing page because it looks like search engine spam to me. Take a look at this link:

Web Analytics E-Book Download – Free From WebSideStory.

Notice the gray footer text? Apart from being hardly legible it contains 50 links, which have been disguised as not being links with the use of CSS. Furthermore, some of those links are wrapped inside H1 and H2 tags, again using CSS to change the appearance. Another give-away is that the whole footer is inside a <div id="SEO"> tag. So the person who put up this page is pretty much saying that this footer was written for search engines, and not for actual readers.

If this is acceptable I will gladly stand corrected…

Now there is absolutely no reason not to do web traffic analysis with the launch of the free Google Analytics service. Note that you don’t have to be an Adwords customers to use the service. Even better for Yahoo Store merchants, the tracking code can be installed in a matter of minutes. After you sign up for the service you will see some very simple Javascript code. Copy and paste this code into the Head Tags variable in the Variables page of the Store Editor. The tracking code will automatically be put on all pages. Finally, check back in a day or so in your Google Analytics account for data to start coming in.

It seems that you can also do conversion tracking for your Google Adwords campaigns. I have also read that you will soon be able to do Yahoo Search Marketing (a.k.a Overture) tracking.

37signals.com has put up a list of suggestions to get your Yahoo Store ready for the holiday online shopping season. Although most of the examples refer to big-budget national retailers, it should be possible to implement many of those techniques without too much technical skill. Of course you still have to find the time to take a look at your Yahoo Store and find ways to improve it.

http://www.37signals.com/holiday/index.html

Marketing Sherpa has a case study about Yahoo Store merchant ylighting.com. In particular, check out their first checkout page; I like their use of trust-building policies and logos.