Performance of Paid Search and Display Ads Drops During Holidays

The festive season is one of the most crowded of the year, with customers’ calendars filled with holiday happenings, and their attention increasingly captured by competing advertisements.

As an online retailer, it is important to plan for the the holidays with increased marketing budgets and expanded campaigns, but also to realize that not all channels will perform equally and the types of customers you acquire during this time of year differ from new customers acquired during other times of the year.

The Customer Lifetime Value (CLV) of customers acquired through Paid Search (CPC) drops 13% during the holiday months compared to the value of customers acquired through the channel during non-holiday months. Display Advertising follows a similar trend, with a 12% decline in CLV for customers acquired during the holidays compared to the rest of the year.

So while marketers should make sure they are well-positioned with targeted ad buys and strong content across all paid channels during the lucrative holiday season, they should also account for the lower individual customer value of some of the channels when planning promotion and discount strategies.

This is a finding from our recent Holiday Edition, E-Commerce Snapshot. The report is based on data spanning 30 million unique customers and $2 billion in revenue across 14 e-commerce verticals.

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 Custora’s Take and How We Can Help

Custora is a predictive analytics platform that helps e-commerce retail marketing teams acquire, retain, and segment their customers. Retailers are using Custora this holiday season to improve their customer acquisition and retention efforts by finding out which marketing channels bring in valuable customers, making changes to acquisition budget and programs, optimizing promotion performance and segmenting their customer base to provide a personalized holiday shopping experience across all channels.

Custora works with leading e-commerce innovators and established retailers such as LivingSocial, Etsy, Fab, and Bonobos. If you’re interested in learning more about Custora, you can request a demo here.

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