Plenty of brands take advantage of Prime Day, Amazon’s summer sales bonanza.
But although they can immediately see the temporary revenue spikes and upticks in new customers that come as a result of one of the biggest tentpole shopping events of the year, customer long-term value (CLTV) can be trickier to measure.
On Tuesday, Flywheel Digital, a digital commerce company for enterprise brands, released a feature that gives brands a clearer view of their CLTV.
The feature was developed together with Amazon Ads and draws on Amazon Marketing Cloud (AMC) data, including granular demographic, geolocation and behavioral data, said Patrick Miller, co-founder of Flywheel Digital.
Brands get a detailed look at customer purchase patterns over time via a dashboard, including how, for example, the way in which customers peruse a brand catalog and interact with products that have different “burn rates,” Miller said.
For instance, Miller’s household buys applesauce packets every two weeks, diapers every month and furnace filters every six months. Armed with these insights, brands can create audience cohorts through AMC, identify their bestselling products and target high-value audiences.
For now, the feature is only available to brands investing in Amazon’s DSP, but Miller expects that Amazon will eventually build a graphical user interface that lets more brands take advantage.
In the meantime, a handful of big CPGs have been testing the dashboard, including Unilever, which tracked the repeat purchase behavior of new customers the brand acquired during Prime Day in 2022.
This data allowed Unilever to measure the ROI of its Prime Day marketing over the course of the year, Miller said. Unilever then applied what it had learned to its 2023 Prime Day efforts, he said, resulting in a 70% year-over-year increase in new-to-brand purchases for one of its brands.
Top o’ the funnel to you
Access to data is important for brands, which often don’t have a direct relationship with their customers.
But the ability to track CLTV helps brands not only better understand the value of repeat purchases but also prove the efficacy of their upper-funnel advertising, Miller said. Although all brands ultimately want to drive sales, brand marketing can influence the path to purchase.
Flywheel’s feature gives credit to upper-funnel activations by “tying them deterministically down to the transaction,” Miller said.
Say a customer sees an ad for a product on Thursday night football through Amazon Fire, followed by a display ad for the same product. Then they search for the item and click on a sponsored product listing to buy it. Instead of assigning all the credit for the purchase to the sponsored listing, AMC’s data can show the brand how many times that person saw a TV ad before buying the product, which allows the advertiser to split the credit across ad types.
But even if a customer buys a product during Prime Day and then buys nothing else from that brand for the rest of the year, it’s not necessarily a wash. Many customers turn to Amazon to do product research, scanning ratings and reviews as they deliberate over a purchase decision.
“They might be in their local supermarket and they’re just curious what people are saying about this brand, and they look it up,” said Miller, noting that what customers see on Amazon makes a big difference in particular for emerging brands and those launching new products.
Over a longer time period, brands can accumulate more data about which items in their portfolio customers interact with most and later buy. Then they can target customers more precisely with discounts, coupons or product announcements.
“It’s like fast-twitch muscles versus slow-twitch muscles,” Miller said.
Buying sponsored products exercises a fast-twitch muscle. The transaction is quick. But doing research on Amazon and brand building are more representative of slow-twitch muscles, which are about endurance. They each have different values.
The value of CLTV takes time to measure.
“The reward is not over three minutes. It’s over a year,” Miller said. “It’s teaching patient urgency to brands.”
