Marketing isn't just for new customers

Jumping back in after a long break.  Like going to the gym (which I also recently restarted), blogging gets really tough when you fall out of the habit.

I’ve been talking to a bunch of clients and prospects recently, and I keep hearing a recurring theme:  “I want to spend my search dollars acquiring new customers, and minimize search spending on repeat customers.”  The goal being to spend marketing dollars marketing to existing customers with email and RSS, and to use the search portions of the buying funnel only to capture new customers in the hope of increasing your overall marketing ROI.  That’s great in theory, but the theory relies on a giant, faulty assumption – that the user will come back and purchase on your site even if they don’t find an ad the next time they search.  Basically, their experience was so good that they’ll be loyal with future purchases.  That’s not reality.  Most customers begin their new buying process on the web, often doing a search.  Emails to your customer list can drive repeat sales, but if you didn’t send an email with the right product immediately before an existing customer is ready to buy something, how likely are they to start at your site and not at a search engine – where they’ll see 10 of your competitors’ ads?  If they see yours, they’ll be more likely to click and buy, but if they don’t see it you can bet they’ll visit a competitor somewhere during their buying cycle.  

A new customer offer is a more appropriate place to spend your dollars on user acquisition.  Offer free shipping, or a discount, or something like that to take into account some portion of the lifetime new customer value and include that offer in your marketing budget.  Limiting your advertising spend to only those places where you get new customers will just assure your lifetime customer value goes down – because your competitors will steal those customers right back!

Instead of focusing on “just buying search for new customers” focus on buying ads that, net of their cost, increase your overall gross profit.  You’ll make more profit that way and you won’t give your competitors an easy way to pilfer your hard-earned repeat customers.
    
Related Tags: search engine marketing, online advertising