Here’s a piece of information that social media worshipers may not like: boosting emails and improving SEO can lead to better customers compared to “likes” and “tweets”.
It’s been a relatively known fact – it’s just that people subjected it to speculation and dismissed by theories. But when credible numbers enter a conversation, all doubts might as well be put to rest once and for all.
Custora recently released a report coming off a study among US companies across 14 various industries. Their data is based on a total of 72 million clients who interacted with 86 companies from 2009 to 2013.
A central tool that they used in the study was a standard measure called Customer Lifetime Value or CLV, which pertains to the “dollar value” of a company’s relationship with a customer. This metric focuses more on long-term projections of cash flows and benefits instead of quarterly benefits. It also sets a limit on how much a company should spend to acquire a customer based on a projected CLV.
Here are some of the notable findings of their study:
- After determining which of the clients involved are ranked as having a “high lifetime value”, it was found out that 54% of those customers were acquired through organic search, which makes it the most profitable channel amongst all strategies.
- When they sought to rank each strategy based on the percentage of customers acquired (without considering the lifetime value), the victor still remains to be organic search, accounting for 16% of all customers, followed by pay-per-click at 9.8% and email at 6.8%.
Facebook and Twitter? Only 0.17% and 0.01%, respectively.
- Twitter came out as the least beneficial channel, even in CLV, where it scored a dreadful 23% below average. Facebook had at least 1% above average, but it’s not something to be proud of, either.
- Although organic search generated the largest numbers, the “most improved” award goes to email marketing, with a growth rate that has quadrupled since 2009. The trending strategy involves building online communities which require email addresses, and then painstakingly converting each of those members to customers via email.
- Two other channels that were found to have rapid increase in success are affiliate referrals and banner advertisements. Both have scored better or at least equal to that of Facebook and Twitter.