Forecasting how many new customers your store will attract in the upcoming months

You can do a lot when you have your customers split out to new and repeat customers like what Repeat Customer Insights does for you.

One way is to see how many new customers you should expect in November and December. This can help you plan how much swag you need or how much new customer service might be needed.

This won't include repeat customers so if you want to forecast how many orders you'll get, you'll want to use your average number of orders per month (it's in the Store Analysis inside the app if you don't want to do the math).

For new-customers only, first use a Cohort report and look at the size of a cohort for a regular month (say April). Then get the size for that same month but last year. Divide the two (this year divided by last year) and that's a rough new customer growth rate.

For example, say you had 100 orders this year in April and 80 orders last year. That's 100 / 80 or 1.25 (125% which is 25% growth).

Now take that number and multiply it by last year's November to get a forecast for this November. Do the same for December to get a forecast for December.

Using the previous example, if you had 200 orders last November and 300 in December, your forecasts would be 200 * 1.25 for November (250) and 300 * 1.25 for December (375).

This is how many new customers you should plan for. e.g. You now know you'd need 625 or so new customer freebies over those months.

This quick calculations can be done easily just by making a few assumptions (e.g. this year is like last year, consistent growth). They are easy to understand and are valuable to do, even if they aren't perfectly precise.

Eric Davis

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Topics: Cohort analysis Forecasting

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