Do You Know Where Your Best Customers Come From?

Silence greeted the question.  Paul didn’t know where his best customers came from online and until I asked, the question never occurred to him.  The truth is that once known, you can increase the profitability of your website exponentially.  However, very few wonder about this question and even fewer discover the answer.  Let’s look at how you can find out where your best and most profitable customers actually come from.

Do you know where your best customers are coming from?

Do you know where your best customers are coming from?

The answer to the question is found in your web analytics software.  Once you know what to look for and where to look, it becomes easy to figure out where your best customers (or leads) come from online.  What would you do differently if you could know with certainty where your most profitable customers came from?  The answer is in your analytics and with the steps below, you won’t need an advanced degree in mathematics to find it.

Don’t be Afraid of Web Analytics

Many website owners are somewhat afraid of their website analytics.  Unless you know what to look for, reviewing your analytics can be not only intimidating, but also a waste of time.  Realistically, all the information that is available inside of a good web analytics program is absolutely overwhelming for most people.  Poking around in there may be a bit interesting, but unless the information you discover is actually useful, the time spent hasn’t been worth it.

Getting Started with Analytics

I recommend Google Analytics, which is free and provides everything you need to know, and then some.  The key to discovering useful information inside of Google Analytics, or any similar program for that matter, is to have a question in mind that you are looking for the answer to.  Having some questions in mind before you start digging into your analytics information ensures that you have a clear focus and direction.

Difference Between Website Visits and Visitors

Inside of Google analytics, there are two different terms that people often get confused – visits and visitors.  Visitors (sometimes called unique visitors or just uniques) represent the number of different people that come to your website.  Visits are the number of times that people came to your website.  Some people will come in just once, while others will come to your website several different times.  The distinction between these two similar labels is very important.  For our purposes – figuring out where the most valuable customers come from – we’ll primarily focus on visitors.  Google displays this information for you in their “Audience Overview” report.

Different Sources of Web Traffic

What we’re really looking for, is to see where people are coming from when they visit your site.  How are they finding your website?  Google displays something close to this in their “Traffic Sources Overview” report.  What is shown here is visits – not visitors.  This gives us an idea of where people are coming from when they visit your site.  This report can be somewhat helpful when making decisions about how to go about increasing the traffic that your site receives.  Ideally, you’ve developed website use cases that correspond to the different sources of traffic to your site.

“Search traffic” depicts the visits to your site that come as a result of people finding you in the search engines.  “Referral traffic” shows the visits to your site that are a result of people clicking on a link to your website when they are on another website.  For example, if someone writes a blog post and includes a link to your site in the blog, when people click on that link, they’ll show up as referral traffic.  One of the common questions that comes up when reviewing a traffic sources report is – what is “direct” traffic.  Direct traffic is a combining of traffic from two different sources – first it includes visits that come from people who type your website address into the address bar of their browser, and secondly it includes people from each of the other traffic sources who, because of their security / privacy settings exactly where they came from before they came to your site is hidden.

Identifying customers

If your customers were evenly distributed across all your different sources of traffic, we’d know where customers were coming from just by looking at the traffic sources overview report.  However, your customers are almost certainly not evenly distributed across your different traffic sources.  For example, – let’s suppose you had 30 different customers who placed an order and the traffic sources overview report tells you that you had 100 visits from search, 100 direct traffic visits, and 100 referral visits.  It wouldn’t make any sense to just assume those customers came in equal amounts from those three visit sources.  Almost certainly Pareto’s law applies here too – 80% of your customers come from 20% of your traffic sources, and 80% of your sources of traffic are only responsible for bringing in 20% of your customers.

In order to identify exactly where the customers are coming from, we’re going to need to turn to goals and custom reports.  Google allows you to create different goals for your site.  For example, you could designate a goal as being achieved when someone visits an order confirmation page.  With custom reports, we can gain further insight by creating a report that shows the goal(s) in the “metric groups” and the “source / medium” in the dimension drilldowns section.  This little trick will give you superman-like insights into where your customers are actually coming from.  Once you’ve created a custom report, you can have it automatically emailed to yourself on a monthly basis and then each month in just a few seconds you’ll be able to discover where your customers found you.  This is one of those things that requires some time to set up properly, but once the setup is done, you can get incredible insights about what’s happening in just seconds each month.

Identifying Your Best Customers

What is it that makes your best customers different from all your other customers?  Hopefully at least one of the website personas you’ve created is descriptive of your best customers.  What do your most profitable customers buy?  How frequently do they buy?  Once you identify what makes your most profitable customers different, you can create a goal in Google Analytics that is associated with your best customers.

Catering to Your Most Valuable Customers

Identifying where your customers came from, may seem a little bit like searching for a needle in a haystack – but it doesn’t have to be that difficult, and the answer can be extremely valuable to you.  With Google Analytics custom reports based off of goals associated with your most valuable customers, you have game changing insights at your fingertips.  Now you’ve got the power to re-direct your marketing efforts around attracting more of your very best customers.  Imagine what happens in your business when you’re able to see what sources of traffic are responsible for 80% of your most valuable customers?

  • Mark Donington October 23, 2013, 3:47 am

    Great article! I agree analytics are a good way to track customers. Target audience profiling is also a must once you have identified said best customers.

    • Charles Ogwyn December 22, 2014, 3:49 pm

      Thanks Mark. Segmenting your target audience and then really focusing on their needs, how you can best serve them, where they come from, and what they do on your site is a key to improving response rates and building a solid relationship. Profiles definitely help keep insights tied to the specific audience segment.

Leave a Comment