Measuring the impact of customer acquisition sources on their likelihood of repeat orders

How you acquire a customer matters a lot when it comes to their repeat buying behavior.

Customer coming from a word-of-mouth directly to your online store will act differently than customers coming from a Facebook ad, which will act differently from ones who visited your physical store.

You can measure the likelihood of a repeat purchase based on these different acquisition sources. You might find major differences between them.

Keep track of what source each customer came from. Over their lifecycle, measure their ordering behavior to see if they ever place a second order.

In Shopify, the source is typically the sales channel source and is saved on each order. You'll have to look back to find the original first order for each customer to get the source that acquired them.

Once you are tracking and measuring these acquisition sources, you can compare the different sales channels based on their acquisition behavior.

For example, this is how they look in Repeat Customer Insights:

[Example impact of acquisition sources on customer's Repeat Purchase Rate]

Even though this example is using fake order data, you can see some useful facts:

  1. Shopify Draft Order customers are coming back more often than the regular Online Store. Could they be larger orders (wholesale) which show a repeat buyer?

  2. The overall rate is much higher than these two sources. Meaning there's other (unlisted) acquisition sources that have a major influence. In this example, there's a custom app that I used to generate the data.

  3. Depending on the volume of sales and costs coming from the Draft Orders and Online Store, it might not be worthwhile continuing to use them vs the 68%+ acquisition sources. Cull the weaker sources and focus on the strong ones.

Now picture this comparing your Online Store, Facebook store, Google Shopping, etc.

You'll be able to see who is sending you the best customers and who you might want to cancel.

This graph was directly from the new Focus on: 1-to-2 Customers report in Repeat Customer Insights. There are several other metrics included (LTV, AOV, Average Latency, etc). Many include the acquisition sources and the ability to zoom in and see each source performed at different times.

If you haven't used it yet, it will pull out your data and build this for your Shopify store automatically.

Eric Davis

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Topics: Acquisition source Customer acquisition Repeat purchase rate Repeat purchases

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