Although all business know the importance of retaining customers, few companies are actually able to measure customer retention accurately, and fewer still can predict which ones will churn or be...
Customer Lifetime Value or CLV (also erroneously called Lifetime Customer Value or Lifetime Value) is one of the most misunderstood of all marketing metrics. Weirdly, everyone in marketing understands its...
Buy One Get One Free or BOGOF promotions, and similar multibuy promotions that provide a free item when customers purchase over a specified amount are very common in retailing, including...
ABC classification is a simple technique that is commonly used in inventory management and is based on the Pareto principle or 80/20 rule. This says that 80% of consequences come...
There are two main ways you can grow the customer base of a business: you can either acquire more customers by increasing your customer acquisition rate, or you can improve...
The RFM model is probably one of the best known and most widely used customer segmentation models by data driven marketers. It’s used for both measuring customer value and predicting...
A growing proportion of what we buy regularly is purchased via a subscription, or some other kind of contract. Most people have contracts for their internet, mobile phone, car insurance,...
Customer segmentation, and the similar and related field of market segmentation, are particularly relevant to the field of business-to-business (B2B) e-commerce. B2B customers often have a higher Customer Lifetime Value...
One common conundrum in e-commerce and marketing involves trying to ascertain whether a given change in marketing activity, product price, or site design or content, has had a statistically significant...
Lead scoring is a Customer Relationship Management (CRM) process that involves segmenting CRM contacts based on their likelihood to make a purchase. Lead scoring is applied to both existing customers...
The Lin Rodnitzky Ratio is a calculation designed to help search engine marketers assess the management of paid search campaigns and account structure. When managing paid search advertising accounts you...
Subscription commerce was all the rage for a while, but it’s not really become as popular as many in ecommerce perhaps envisaged. While we may have subscriptions for certain things,...
Customer segmentation is the process of using data science techniques to create discrete groups of customers which share common characteristics or attributes. For example, a company might segment customers into...
Marketing Mix Models (MMMs) utilise multivariate linear regression to predict sales from marketing costs, and various other parameters. A Marketing Mix Model (also called a Media Mix Model), even at...
Customer segmentation can give you huge insights into your business and identify a whole range of different things about your customers, allowing you to change your marketing and improve results....
While the Recency, Frequency, Monetary value or RFM model for customer segmentation might be old, it’s based on sound science, so no matter what customer model you’re building, it’s generally...
Cohort analysis is unlike most other customer segmentation techniques in that it typically uses a time-based element. It’s typically used to segment customers into groups, or cohorts, based on their...
Understanding what drives customer churn is critical to business success. While there is always going to be natural churn that you can’t prevent, the most common reasons for churn are...
In the ecommerce sector, one of the most common tasks you’ll undertake after arriving at work each morning is to check over the recent analytics data for your site and...
Knowing which of your customers are going to churn before it happens is a powerful tool in the battle against attrition, since you can take action and try to prevent...
Calculating Customer Lifetime Value or CLV is considered a really important thing in marketing and ecommerce, yet most companies can’t do it properly. This clever metric tells you the predicted...
You can learn many things about your products from the purchase behaviours and product consumption and product replenishment of your customers. Some items are purchased individually, some items are purchased...
Purchase latency or customer latency is a measure of the number of days between a customer’s orders and is one of the most powerful features in many propensity and churn...
In B2B ecommerce, there are two main approaches to new customer acquisition: you either rely on your website to acquire customers for you, or you target specific customers through sales...
Marketers can be just as obsessive about data as data scientists, so there are an abundance of well-researched marketing metrics available for analysing marketing performance. Most of the commonly used...
Customers are expensive to acquire but generate more and more profit as time goes on. Providing you nurture them, treat them kindly, and apologise and fix any mistakes that occur,...
Category management is a retail technique that breaks down a company’s product range into groups of related items, such as categories, or subcategories, or by their product type. By running...
Catalogue marketing is dying out. Over the past few years, virtually all the UK’s top catalogue retailers have stopped printing on paper and successfully transitioned their businesses online, either to...
Recent papers on the Recency, Frequency, Monetary or RFM model, such as the one by Inanc Kabasakal in 2020, have started to adopt text-based labels to help people understand the...
Transactional item data can be used to create a number of other useful datasets to help you analyse ecommerce products and customers. From the core list of items purchased you...
The predictive response models used to help identify customers in marketing can also be used to help outbound sales teams improve their call conversion rate by targeting the best people...
The things we search for online can reveal a remarkable amount about us, even when viewed in aggregate on an anonymous level. For many years, Google has made some of...
Data binning, bucketing, or discrete binning, is a very useful technique for both preprocessing and understanding or visualising complex data, especially during the customer segmentation process. It’s applied to continuous...
If you read research papers on machine learning, you’ll notice that many researchers use the same standard datasets so other data scientists can reproduce their work or try and improve...
You might think human behaviour would be hard to predict but, in ecommerce data science, it’s not actually as difficult as you may think to predict whether a customer will...
While some people might naively interpret it as negativity, I think one of the best ways you can improve an ecommerce business is to focus on the stuff you’re not...
In both B2C and B2B ecommerce, special trading periods such as Christmas, Mothers’ Day, and Valentines’ Day can often greatly contribute to sales. Indeed, the introduction of Black Friday sales...
A Next-Product-To-Buy (or NPTB) model is designed to help retailers and marketers improve the effectiveness of cross-selling product recommendations by predicting the product each customer would be most likely to...
Uplift modeling is a machine learning technique used in marketing and ecommerce to predict which customers are likely to respond to a particular marketing campaign. However, rather than simply predicting...
Market Basket Analysis, or MBA, is a subset of affinity analysis and has been used in the retail sector for many years. It provides a computational method for identifying common...
In the ecommerce sector, you can learn a lot about your competitors and the expectations of your customers by analysing the reviews their customers leave for products and service on...
Over the past decade I’ve written more Google Analytics API queries than I can remember. Initially, I favoured PHP for these (and still do for permanent web-based applications utilising GA...
