Interesting perspective. I find a lot of these customer/visitor value calculations to be exercises in futility though.

I think Hillstrom’s assumptions of 3% conversion per successive visit is likely very low. In my experience (and with most typical sales processes), the more touches, the higher the conversion rate.

IMO, his 3% is too conservative, especially for a web-driven campaign. The close rates for traditional sales campaigns looks like this:

1 touch – 2% max
2 touches – 3-4%
3 touches – 5-7%
4 touches – 10%
5 touches – 22%
6 touches – up to 40%
7 touches – up to 55%

With every successive touch, I believe the likelihood of a purchase grows. The prospect continues to qualify him/herself with each visit, so the close rate should be higher. Conversely, the remaining pool continue to disqualify themselves, which accounts for the 50% visitor attrition. I believe that ratio is reasonable.

The validation of campaigns is tricky business. If you’re too conservative, you look like you don’t believe in your strategies or tactics. Too aggressive, and you look foolish. Instead, I believe that if you take the real sales numbers and add a common sense value for potential successive visits, you can come up with a believeable evaluation of your campaign(s), even if not completely accurate.

Jason – I agree with you on repeat conversions. I believe that good e-marketing analytics includes silos for first conversion (new customer), repeat customer, and if appropriate, resurrected lost customers. This can be accomplished with integrated lead or customer management systems and a strong call to action to entice someone to add their name to the mailing list.

To me, the only real metric that matters is the number of people who are willing to give me their personal data. From there, it’s a simple numbers game to extract expected sales.

With email, you can always withhold part of your distribution list as a control group, if you really want to see the lift of that release. That’s not possible with campaigns to the public at large!

I agree, though, that email marketers have to look at new ways to evaluate their efforts. They’re a key driver of business in most online marketers’ promotional toolkit.

Another thing to keep in mind too is that just because someone converted once, doesn’t mean they can’t convert again.