Online retail’s ‘Golden 1%’- Loyal customers generate 40% of ecommerce sales

Oct 15, 2013 | E-commerce and E-retailing

Just over 1% of a retail website’s users generate as much as 40% of its revenues according to new research. The study, from Customer Experience Management (CXM) platform Qubit, examined 950 million page views from more than 123 million website visits. The research found that whilst this 1.06% of total visitors generate four tenths of […]

Just over 1% of a retail website’s users generate as much as 40% of its revenues according to new research.


The study, from Customer Experience Management (CXM) platform Qubit, examined 950 million page views from more than 123 million website visits.
The research found that whilst this 1.06% of total visitors generate four tenths of a site’s income, there are a further 20% of site visitors who will never make a purchase.
Released to mark the launch of the latest version of Qubit’s Customer Experience Management platform, the research breaks down website visitors into a range of different user types:
Sofa Surfers – 17% of website users visit sites regularly, but never purchase. Their regular viewing times of 9.00am-11.00am and 1.00pm-5.00pm suggest that they might be stay-at-home mums or non-working individuals with plenty of time on their hands to surf their day away. They are twice as likely as your average site visitor to be surfing on an Apple device using the Safari browser and to be using a tablet. Geographically, these users tend to come from urban areas, although Londoners don’t seem to be as prone as others to this behaviour.
Big Spenders – This core of loyal website fans make up just 0.03% of total users but create 30% of revenue. Intensely loyal to their chosen retailer, they visit their preferred sites 300 times more often than the average user. They’re 20% more likely than the average to be using a tablet, but are 10 times less likely to be visiting via a mobile. These users shop between 1.00pm-3.00pm during the day, but will also spend up to 20 times longer than the average user surfing between midnight at 4.00am. These users are 23% less likely than average to come from Central London but are over-represented in the city’s suburbs, in particular in Ealing, where more than twice the average number reside.
Basket Cases – A strange retail breed, the basket case comes to a site and fills their shopping basket but never completes their purchase. They only represent 2.46% of users, but generate no revenue for the retailer. They tend to use Google’s Chrome browser, which has a younger user base that’s happy to shop around, perhaps explaining their bizarre on-site behaviour. These users come from the Midlands and North West, particularly from Birmingham, being 50% more likely than average to come from that area. They’re also largely nocturnal, with their web usage focused around 7.00pm-3.00am.
Speedy Shoppers – Making up 1.03% of users, the focused few generate 10% of total revenues, making them the second most valuable segment. These users visit a site and make a purchase with no messing around and seemingly little consideration. Whilst Mancunians rarely display this behaviour, people from NE London seem to be keen on this sort of focused shopping. They’re 18% more likely to be using a mobile and tend to surf via Internet Explorer or Chrome.
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The research findings were developed using analysis from Qubit’s ‘big data’ retail analytics and personalisation platform. This collects and analyses information about behavioural trends amongst website users and then lets retailers serve up personalised websites based on that insight.
The new version of Qubit’s CXM platform offers marketers even more easy-to-use features and functionality. New capabilities include:
Real time personalisation – Using Qubit’s real time audience discovery engine, marketers can identify and prioritise their most valuable customers in real time, letting them personalise any area of their website based on previous activity or in-session behaviour.
WYSIWYG interface – A new interface that enables marketers to create and amend entire site templates to create rich personalisation, without any input required from the IT department. Using this functionality, marketers can rapidly respond to changing consumer habits, letting them be nimble and responsive without having to rely on hard-pressed IT teams. Dynamic information such as stock and price can be used to automatically update messages across hundreds of pages at a time, for example showing customers a low stock ticker to drive purchasing urgency.
Prove conversions faster – Upgraded AB testing functionality lets marketers test their personalisations faster and more accurately, giving quicker ROI on all changes.
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Graham Cooke, CEO of Qubit, said: “By breaking down online shoppers into these different personas its easy to see where retailers should be focusing their efforts. Sofa surfers and basket cases show all the traits of ‘real’ shoppers and if you’re not analysing your audience properly you’ll never know that they’re giving you nothing back. By understanding what people are doing on your site, and whether or not they’re going to turn into paying customers, you can make more informed decisions about where to invest your marketing budget. Conversely, its vital that you encourage and embrace your big spenders and the speedy shoppers because these tiny segments are driving a massive percentage of your revenue.
“The new version of our core platform puts even more power in the hands of marketers. It lets them understand what customers are doing on their site and then personalise their website in order to respond to and capitalise on these behaviours. Giving marketers the ability to retail in real time lets them maximise the potential of all of their audiences.”
Source: http://www.qubitproducts.com/

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