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Customer Acquisition for Online Retailers

Posted on 8.02.2015

By Peter Prestipino, Editor-In-Chief


Enterprises can't grow (or exist for that matter) without a steady stream of new and qualified leads (customers). It is a challenge for all 'Net professionals, of course, but particularly difficult in the realm of e-commerce, where the battle for consumers' attention (and dollars) can be both competitive and costly. In addition, as more sophisticated attribution models (how credit for sales/conversions is assigned to touchpoints in conversion paths) come into use by marketers (see sidebar on the next page), the combination of the channels used to drive conversion become even more important to the digital success of an enterprise.

What this means is that not only do today's e-commerce merchants need to find creative and compelling ways to capture the attention of a prospect (through engaging and compelling content and quality products), but also select the right combination of marketing channels - be it direct or via search, social, display ad or referral - where their message will resonate to the tune of increased conversions.

Search & Proper Attribution

The ultimate measure of a quality lead generation campaign is the volume and quality (e.g. lifetime value) of conversions that are generated. So what is the best source of new users for Internet retailers today? Without question, the answer remains search.

According to Marketing Sherpa's 2015 "E-Commerce Benchmark" study, organic search was the most frequently reported source of significant traffic at all success levels, while respondents at the lowest success levels were disproportionately frequent in their reliance on direct traffic and product listing ads.

Where Marketing Sherpa's study comes up somewhat short, however, is in not differentiating how consumers initially found a retailer from how they ultimately converted from these channels. In late 2014, however, Bizible analyzed data from nearly 500,000 leads tracked through its Salesforce marketing analytics platform to provide insights into how marketers should address attribution models and why the traditional last-click model is no longer the best approach. What they found when looking at last-touch only data was that search accounted for 41 percent of the leads generated - significant by any measure.


Who's Getting Paid?

A look at today's attribution models at wsm.co/attrmodels15


When considering the first-touch in addition, however, search actually accounted for 56 percent of the leads (37 percent last-touch). Essentially, organic search is even more important than many e-commerce brands may realize - and they should invest accordingly.

E-Commerce SEO

Search engine optimization is getting more complicated by the moment. Discover practical tips for establishing and improving any retail website at wsm.co/seecomm.

There are, of course, numerous variables that influence the success of a lead generation initiative for merchants. The methods used within the actual moment of lead capture and conversion receive their due attention (read this month's feature for more), but it's almost always going to be the channel where message distribution occurs (e.g. the awareness phase) that should remain top of mind with e-commerce merchants. For that reason, the role of digital advertising must also be addressed.

Display Ads: Remarketing & Managed Placements

Traditional display advertising can be both expensive and challenging so many of the savviest merchants are wisely turning to two very effective tactics - remarketing and managed placement.

Remarketing is an expansive and nuanced topic, but several best practices have emerged that brands should consider to maximize their investment. In order to best serve its readers, Website Magazine has assembled a detailed three-step guide to the advertising practice that should certainly make a positive impact on revenue for Internet retailers at wsm.co/3retarget.

Managed display placements is another viable option for e-commerce advertisers to drive new business as it is perhaps the only targeting method that gives advertisers the granular control required over where their ads are being placed. For those who use methods like interests or topic targeting at Google, for example, that system automatically does the decision-making on its own about which sites are relevant. Managed placements, however, allow e-commerce advertisers to choose exactly the sites they want their ads to be displayed on, which is why it's a safe bet when branching out into display.

The Paid Social Media Channel

Brands must participate in social media, and while organic (unpaid) participation is important, that content and the relationships developed can also be used in advertising. While many have struggled with this channel, some recent developments could make social a more effective method of customer acquisition.

Facebook, for example, recently modified its advertising model and redefined its approach to cost-per-click. In the past, Facebook measured CPC as any click taken within an ad unit, including a like, comment, share, click to a website and more. With the update, however, Facebook will measure "link clicks," which is defined as clicks related to certain ad objectives. For example, link clicks include clicks to visit another website, call-to-action (CTA) clicks that go to another website, clicks to install an app, clicks to Facebook canvas apps or clicks to view a video on another website.

Not to be outdone, Twitter is also experimenting with some rather creative advertising experiences for e-commerce. See them in action at wsm.co/twittershoptest.

Data Feeds & the Performance Channel

Datafeed creation can be a frustrating process. Most development teams cringe at the request, but that is changing thanks to some innovative new technologies. Datafeed creation is now possible without any tech resources thanks to ChloeWorks's new tool, Chloe Feed Assembler (CFA), a Web extractor/site scraper that crawls any retail website, gathering product data and assembling that data into a feed for all major U.S. and international affiliate networks. After signing up and requesting a feed, the Chloe Feed Assembler crawls the requested site on the designated days, assembles the data, cleans it and exports it to the network(s) chosen, including Linkshare, ShareASale, AvantLink, Impact Radius, Google and many other networks. CFA can crawl an unlimited number of products and schedule recurring feed creation in advance.

Ready for New Customers?

There will never be a one-size-fits-all strategy for e-commerce retailers when it comes to the optimal approach to acquiring new customers. Understanding that each of the aforementioned channels can in some way contribute to the success of an enterprise, and prioritizing efforts to focus on those opportunities that benefit the bottom line most, however, is the fast track to website success for Internet retailers.

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