{"id":5743,"date":"2015-06-22T15:42:04","date_gmt":"2015-06-22T14:42:04","guid":{"rendered":"http:\/\/ecommercemasterplan.com\/?p=5743"},"modified":"2015-08-28T17:45:08","modified_gmt":"2015-08-28T16:45:08","slug":"why-are-we-still-obsessed-with-new-customer-acquisition","status":"publish","type":"post","link":"https:\/\/ecommercemasterplan.com\/why-are-we-still-obsessed-with-new-customer-acquisition\/","title":{"rendered":"Why are we still obsessed with new customer acquisition?"},"content":{"rendered":"

\"newDuring June I attended the Direct Commerce Associations Annual Summit in London (UK eCommerce businesses \u2013 you should check out the DCA, there\u2019s knowledge being shared there you just can\u2019t get anywhere else in the world).<\/p>\n

During one of the forum sessions Nigel Swabey of Scotts of Stow kicked things off by reading out a list of potential topics and getting the room to vote for what was covered. The standout winner was \u201cHow to recruit more new customers and increase traffic\u201d with every hand in the room raised. It won ahead of customer retention, selling overseas (not one hand went up!), the European Union Data Protection Act (a few hands \u2013 it\u2019s not exciting, but it is essential), how to sell your business for a good price (which got as much interest as Customer retention!).<\/p>\n

Clearly ecommerce businesses remain obsessed with new customer acquisition.<\/p>\n

But why are we obsessed with customer acquisition?<\/p>\n

Read any marketing text book, or take any marketing qualification and they\u2019ll bang on about how customer retention is key and that it\u2019s much more profitable and low risk than recruitment. Those of us who study business strategy always learn that a recurring revenue model is much more attractive, customers who keep buying!<\/p>\n

Given we are surrounded by stats that prove we should be much more interested in retaining our existing customers, and milking them for every penny we can \u2013 why was the room (of highly experienced managers of businesses of all sizes) most interested in NEW customers?<\/p>\n

This attitude is not unique to the group of businesses at the summit. I don\u2019t think there\u2019s one answer, so here are my thoughts on the possible reasons.<\/p>\n

Are we all customer retention gurus?<\/h2>\n

Do we have customer retention sorted to the point we are getting 2+ orders per year from our customers, with ever increasing customer lifetime values, and an average customer lifespan of 10 years?<\/p>\n

No. We\u2019re not.<\/p>\n

Another \u201chands up\u201d poll during the same forum asked \u201cwho\u2019s doing remarketing online\u201d less than 10% of the room put their hands up.<\/p>\n

Automated email systems (like Infusionsoft with Revenue Conduit or Bronto) are only being invested in by the most savvy ecommerce businesses and many of those start with a welcome sequence and an abandoned basket sequence before getting distracted! So they\u2019re barely scratching the surface.<\/p>\n

Many eCommerce businesses with big budgets are failing at it too \u2013 on our podcast Sugru\u2019s Linda Muck<\/a> named H&M as the business she\u2019d most like to work for because their lack of progress in this area frustrates her so much.<\/p>\n

Is the new customer focus a hangover from when we started the company?<\/h2>\n

For the first year(s) it is ALL about new customer acquisition. It has to be or you wouldn\u2019t make it to year 2.<\/p>\n

So do we get into the habit of focusing on new customer acquisition metrics, and just never get around to changing our KPIs (Key Performance Indicators) and reporting to look at the retention numbers? And never get around to re-aligning our mindset to focus on retention?<\/p>\n

Ask any eCommerce business owner these 2 questions, and I\u2019ll bet you they\u2019ll know the answer to the first and not the last:<\/p>\n