New customer acquisition is considered the third most important metric for gauging marketing effectiveness in 2024, behind ROI and delivering business outcomes.
Businesses are continuing to prioritise acquisition of new customers over rewarding and retaining their existing customer base, new data shows.
Marketing Week’s exclusive 2024 Language of Effectiveness survey of more than 1,200 marketers reveals a third (33%) of brands analyse new customer acquisition in their suite of effectiveness metrics. However, only just over a quarter measure customer lifetime value (26.2%) and customer retention rates (25.1%).
Indeed, customer retention is the second least popular effectiveness metric behind brand affinity (24%).
Furthermore, when asked which are the top three most important metrics amongst senior stakeholders to measure marketing effectiveness, customer acquisition was rated as the third most important factor (26.6%) behind return on investment (30.1%) and delivering business outcomes (27.2%).
Digital creative delivers ‘more emotional impact’ than offline
Customer retention rates (18.3%) are far further down the list of most important metrics for senior stakeholders, with customer lifetime value languishing at 16.7%.
When looking specifically at B2B brands, 31.4% measure new customer acquisition, falling to 25.5% for customer lifetime value and 25.1% for customer retention rates. Acquisition is the third most important metric for senior stakeholders within B2B brands (29.9%), while retention rates (16.9%) and customer lifetime value (16.5%) sit far lower down the pecking order.
There is a similar picture within B2C firms, a third of whom (33.5%) measure new customer acquisition. The percentage is far lower for those measuring customer retention rates (28.5%) and customer lifetime value (25.8%).
Again, acquisition of customers (26.2%) is considered more important by senior stakeholders in B2C businesses than customer lifetime value (19.1%) and customer retention rates (18.4%).
Improving trend?
This interest in acquisition over retention is a persistent one, although the 2024 Language of Effectiveness stats suggest a slight softening of sentiment.
Whereas in 2024 a third of businesses analyse new customer acquisition, this is down on the 46.4% who focused on this metric in 2023 and 51.1% in 2022.
Likewise, in 2023 some 32.2% of the total sample reported measuring customer retention rates and 25.1% customer lifetime value. In 2022, 31.9% measured customer retention and 27.1% lifetime value.
Tellingly, customer acquisition was the second most important metric (36.1%) for senior stakeholders in 2023, only behind ROI (41.6%).
Over the coming weeks, Marketing Week will be publishing a series of exclusive news and features based on the findings of the 2024 Language of Effectiveness survey. Read the series so far here.
link