Ecommerce Personalization Blog
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[New Study] New vs Returning Customers eCommerce Behavior
How valuable is getting a customer back to your site?
We wanted to discover how returning visitors acted differently than first time visitors, looking at how they acted across the most important KPI's in eCommerce.
Executive Summary: Return Visits Matter (a lot)
We found retained visitors:
Getting that first visit is like planting seeds. It is a lot of effort and work and to prepare the land i.e. create the conditions to get a customer on site.
Returning visits takes that customer from seed to fruit bearing tree. All the profit happens as you are able to bring the customer back and begin learning, engaging with, and converting that lead.
The Data: Where we got it and how we cleaned it
To conduct this study, we sampled 1.3 billion sessions over the past two years.
We wanted to see how returning visitors acted differently than first time visitors across the major eCommerce KPI's: add-to-cart rate, cart abandonment rate, overall conversion rate, and average order volume.
This writeup focuses on how these segments act differently in add-to-cart rate and conversion rate, while the next will focus on cart abandonment and average order volume.
Throughout this study, you will see that we segmented site traffic in two major ways.
First, we compared first time visitors to returning visitors, measuring the overall impact on profits.
Second, we further segmented according to device type to see how a visitor's value changes across devices.
Returning Visitors dramatically increase your add-to-cart rate.
The first step in getting a visitor to convert into a buyer is to engage them.
Add-to-cart rate is a simple, effective measure that captures high level engagement with your site.
In this one graphic we begin to see the value of retained customers.
While new visitors added items to their carts on 4.84% of sessions, returning visitors added an item to their cart 8.26% of the time - a 70.6% increase on average.
Device Effect on Add-To-Cart Rate
Mobile continues to grow in importance across the board. Not only is mobile traffic growing as a percentage of overall traffic ( you can see our own study breaking down how to maximize mobile advertising spending here), but Google and other search engines continue to prioritize mobile in their rankings.
Because of mobile's continued importance, we wanted to see if returning visitors' affect was more or less important on smaller screens.
The numbers are convincing.
Returning Visitors Add-to-Cart Rate
Desktop: + 58.18%
Returning visitors are even more valuable on mobile devices.
This makes sense given the difficulties mobile presents: less real estate makes it more difficult to convey value and make offers that resonate.
The truth is...
Creating relevant, remarkable first-time experiences can benefit your store more than customer acquisition efforts.
This is why you need to focus on bringing customers back to your site.
To discover how, check out our in-depth guide on the best retention strategies and tactics in 2018 all geared to increase your retention rate.
Returning visitors are dramatically more likely to add an item to their cart. On average, a returning visitor will engage with a product to the point of adding it to their cart 70.6% more often than a new visitor.
This effect is amplified on mobile, where that number rises to 85.3% more. As mobile traffic continues to grow as a percentage of overall traffic, getting customers to return to your site will become even more important.
If you want to increase your add-to-cart rate, focus on increasing your ability to get new visitors to return to your site.
Returning Visitors dramatically increases your conversion rate.
While add-to-cart measures engagement and intent, it's really only valuable in-so-far as it helps you understand your overall conversion rate.
As a quick aside, for the purpose of our study we calculated conversion rate as the number of sessions that resulted in a completed purchase divided by the total number of sessions.
Therefore, adding the item to the cart DID NOT have to occur in the same session. We choose this methodology because it reflects real consumer behavior: customers shop, add to cart, abandon, come back, and may or may not complete purchase.
Conversion Rates: New vs Returning
Returning visitors will complete a purchase about 75% more than a new visitor would. This effect has held relatively constant over the past two years.
Retailers must build loyalty into their site to improve conversions.
Obviously there are a number of ways that you can do that. However, one of the fundamental strategies you should employ is personalization.
A study by Accenture makes this clear.
Accenture's findings are consistent with our own study on personalized product recommendations.
In that study, we found that creating personalized product recommendations had a massive effect on conversions.
Unlike the add-to-cart ratio, returning visitors effect on conversions did not increase on mobile.
That being said, returning customers were still clearly more valuable than new ones.
Returning Visitors Conversion Rate
Part of this can be attributed to the fact that personalization techniques are more easily implemented on larger screens.
On a computer, you are able to place more widgets and customizations. In contrast, many stores strip their mobile UX down to the essentials.
This brings to light another important aspect in maximizing sales.
Many customers begin their purchase journey on mobile, and complete their purchase on a computer. To provide the best experience, you need to be able to track customer's across devices, identify them when they land on your page, and personalize your offers in real time.
Returning visitors buy (75%) more than new visitors. Personalization is a major reason why.
When you are able to capture web behavior data and understand what types of products your prospect is interested in, you can personalize product recommendations and other offers to dramatically increase conversions.
Next Steps: How to Get Customers to Come Back
This study looked at how returning visitors positively impacted two major eCommerce KPI's: add-to-cart rate and conversion rate.
Next month, we will look at how these visitors effect both cart abandonment rate and AOV.
However, from this study alone we can conclude three things.
First, returning visitors can be a driving factor for increasing add-to-cart rates.
Second, returning visitors are 75% more likely to buy from you.
Third, personalization is a major key to maximizing these boosts in KPIs.
As mentioned, we've written a number of resources to help any eCommerce brand improve their efforts.
You can also see how Barilliance has helped hundreds of retailers combine and execute retention and personalization strategies to drive retention and increase profits by requesting a demo.