Holiday customers that come back the following holiday season convert at 4.2% compared to 2% conversion for all customers

Monetate, a worldwide leader in personalization, announced the release of new research that finds customers acquired during the previous holiday season were more than twice as likely to convert the following holiday season compared to other customers. Monetate analyzed 8.52 million customers across 2017 and 2018 holiday seasons and identified that customers who came back, or were “retained” the next holiday season were a significantly more valuable segment that is often overlooked because of their relatively smaller size. While the average conversion rate for all returning customers is about 2%, retained customers from the previous holiday season converted at 4.2%.  The research illustrates the value of identifying valuable audiences even if they are smaller. With automated personalization, retailers can effectively grow more of these customers into their best customers. This strategy is valuable not only for past customers, but for planning 2019 holiday marketing that will deliver in 2020.

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“As retailers get ready for 2019 holidays, this research shows how important it is to use technology that can analyze and segment valuable audiences at scale. With insights like this, marketers can be planning for the long term customer relationship,” said Lisa Kalscheur, Chief Marketing Officer, at Monetate. “We found that retained holiday customers are significantly more valuable during the next holiday season, which should be informing personalization efforts that go well beyond the next few months.”

The report also looked at the relative conversion rates of retained holiday customers across several major referring sites including Google, Bing, Facebook and Instagram, as well as visitors who natigated directly to the site. People coming from Bing and Yahoo have consistently higher conversion rates. Retained Bing customers convert at 8%, four times the typical returning customer. This small but loyal group would benefit from personalized approach that treats them differently than typical shoppers.

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Monetate also found that people who converted after coming from Facebook and Instagram showed much higher conversion rate growth one year later, and this group is growing in size year over year for most retailers. What’s more, customers who came to a brand’s website first via Facebook and were engaged enough to come back the following holiday season are nearly 70% more likely to purchase than the first year. This finding is bolstered by previous Monetate research which found the value of sequential personalized pageviews increases performance of referral channels like Facebook.

“Historically, marketers have had to design their holiday marketing campaigns to appeal to the widest audience possible, which has left out key high-value groups such as the growing Instagram shopper audience,” said Kalscheur. “With the right approach, marketers can find these groups and create personalization campaigns that appeal to them specifically, creating opportunities for more growth.”

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