Agathe Westad Optimove

Attracting new people is expensive. 

But turning one-time shoppers into loyal customers can be complicated.  

“It’s a subtle mix between the right category and the right ticket price,” Agathe Westad told the crowd during the WWD Digital Forum in New York City earlier this month. 

That’s where Optimove comes in. 

The Tel Aviv-based software company, which also has offices in New York and London, uses data analytics to develop personalized marketing strategies. Turns out, consumers are dropping hints all the time as to whether they’ll come back. On the flip side, Westad said there are things companies and brands can do to minimize the likelihood that they’ll get ghosted by the shopper. 

But the formula varies. 

“Segmentation is idiosyncratic; it’s about what makes your customer stick,” said Westad, director of new business at Optimove. “For each brand, you have to understand what that life cycle is. If you don’t have an understanding of what that life cycle is, it’s going to be difficult to create longtime customers.” 

Agathe Westad Optimove

Agathe Westad  Patrick MacLeod

A number of factors — like the day of week of purchase, time of day, order amount and product category — help predict whether a consumer will return. They also provide a guidebook for companies to map out future marketing strategies. 

Westad noted a few. Like a brand’s window to secure a second purchase is usually within 90 days of the first purchase. Or, that most people do their shopping at the same time each week. That means sending e-mails at the wrong time will have little impact. 

Or that, statistically, if a company tries to promote a second purchase that’s in a higher price range, the customer is less likely to respond. Or, the greater number of sku’s, or products, in the first order, the more likely that person will turn into a return shopper. Or, that huge discounts — such as those offered on Black Friday — rarely create loyal customers. Westad said it’s better to reserve good deals for existing shoppers who have already demonstrated loyalty. 

“It’s a game of looking backward and looking forward at the same time,” Westad said. “You want to look backward to the first purchase and try to dissect it. And then you want to look at people who have made more than one purchase and understand what was different about them and then use that knowledge to replicate it.”

In addition, Westad noted that keeping customers is cheaper than hooking new ones. In fact, acquiring new customers is four times as expensive as retaining existing ones. 

“Which is terrifying,” Westad said. “When you think of the money [companies] spend on acquisition; the time you spend on creating beautiful content, social media influencers, the in-store experience and engaging with communities. 

“We’re fighting the war on one-timers,” she said.

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