Why are Marketing Analytics Like Cracker Jacks?

by Barb Cote on May 14, 2010

Barb Cote

Are any of you old enough to remember the commercial’s song?

“Candy-coated popcorn, peanuts and a prize, that’s what you get in Cracker Jack!”

Marketing analytics offers the same promise as Cracker Jack — chock full of tasty insights plus a free surprise!

Here is an example of using analytics to discover who your best customers are and what your brand offers them that keeps them coming back:


According to a recent article in Internet Retailer

Customers on average return 35% of the items they order from Zappos.com Inc., a web-only retailer of footwear, apparel and other merchandise. But there’s a certain group that returns 50% of what they buy. Zappos loves those customers.”

That’s because those consumers tend to purchase from among Zappos’ most expensive lines of footwear, then happily take advantage of the e-retailer’s generous and well-publicized returns policy:  Zappos not only will take back any item within 365 days of delivery, but also pays for the return shipping.

And since it costs the same to ship a $300 pair of pumps as it does to ship a $30 pair of sandals, the Zappos policy of winning over shoppers with its returns policy has helped to bring in high profit margins on many of its orders, says Craig Adkins, vice president of services and operations at Zappos, which was acquired last year by Amazon.com Inc.

“Our best customers have the highest return rates, but they are also the ones that spend the most money with us and are our most profitable customers,” Adkins says.

Zappos’ well-known “always free returns” policy has netted them the most valuable online shoe shoppers because they won’t be punished for their desire to buy lots of expensive shoes now and possibly change their minds later.

With marketing analytics, the high maintenance customer is actually the high-value customer! Kudos to Zappos, which saw the “surprise inside” their data and leveraged it for greater brand value.

About the Author:

Barb Cote serves as the Creative Director at SIGMA Marketing Group.  Connect with Barb on  or follow her on .

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