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Email and Search Deliver More Customers Than Social Media

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Organic search still leads as the largest channel for online e-commerce customer acquisition, and email as a channel has exploded in growth over the past four years, according to a recent report by Custora.

The study, which examined data from 86 US retailers across 14 industries, found organic search to be the largest source of e-commerce customers (15.8% of all customers acquired), followed by cost-per-click (9.8%). Since 2009, customer acquisition via email has quadrupled, growing to 6.8%. Affiliate referral traffic has also grown significantly, and now accounts for 6.3% of customers acquired.

In contrast, Facebook accounted for just .17% of all e-commerce customers acquired, and Twitter was responsible for less than .01%.

Below, additional key findings from the E-Commerce Customer Acquisition Snapshot.

Customer Lifetime Value

  • Overall, customers with the highest projected lifetime value arrive through organic searches (54% higher than average), according to the study.
  • Customers acquired through Twitter tend to be worth about 23% less than average. This may be attributed to the frequent discounts offered in tweets.

Customer Value by Location

  • The most valuable online shoppers overall tend to come from more rural US states.
  •  However, fashion-focused brands find many of their most valuable customers in coastal urban areas such as New York, Los Angeles, Portland and Boston.

About the research: The report was based on data from 72 million customers who interacted with 86 US retailers across 14 industries. Acquisition channels were determined by using the "utm_medium" tag in Google Analytics.

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Ayaz Nanji is an independent digital strategist and a co-founder of ICW Content, a marketing agency specializing in content creation for brands and businesses. He is also a research writer for MarketingProfs. He has worked for Google/YouTube, the Travel Channel, AOL, and the New York Times.

LinkedIn: Ayaz Nanji

Twitter: @ayaznanji

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  • by Maria Dykstra Mon Jul 15, 2013 via web

    Again we are comparing apples and oranges.

    Social Media is an awareness building tool at the very top of the marketing funnel; CPC and email are conversion mechanisms. Of course, they are more likely to convert, but we also need to look at how customers arrived at the purchase decision.

  • by Maria Bywater Mon Jul 15, 2013 via web

    Maria, you're right about social media being most useful as an awareness tool. Combine that with Ayaz's observation about the lower lifetime value of customers acquired through Twitter, especially the role of tweets offering discounts. Together, the points make a pretty good argument that if someone is using Twitter to build awareness, tweeting discount codes isn't the best approach -- but it's something a lot of people do.

  • by Ayaz Nanji Mon Jul 15, 2013 via web

    Maria & Maria, thanks much for the comments. Agreed that conversion is only part of the mix. I've been on the lookout for some good recent research examining how the various platforms compare in terms of building awareness.

  • by Gracious Store Mon Jul 15, 2013 via web

    It can be argued that the social media are source of awareness building for brands, but the question is how many people remember the names of the brands they see on twitter or facebook and really connect with those brands?

  • by Steve Osborne Tue Jul 16, 2013 via web

    Interesting stats, well written, great presentation. Thankyou.

    Are you planning, or do you have access to any similar studies of the same media channels in the B2B or service-based business area? I find this kind of succinct article/report really useful.

  • by Randy Milanovic Wed Jul 17, 2013 via iphone

    Social provides the assist.

  • by Ayaz Nanji Wed Jul 17, 2013 via web

    Steve, I can't think of a B2B-focused study off the top of my head that covers the exact same ground (the effectiveness of various channels in the context of e-commerce). That said, we have touched on some similar ground in past pieces. You can find a bunch of our B2B content here:

  • by Steve Osborne Thu Jul 18, 2013 via web

    Ayaz, I should have been clearer. I'm looking for studies showing the comparative strength of these same channels for overall B2B online customer acquisition, not just for e-commerce. I'm trying to ascertain the relative worth of Social Media against organic search & email, in a concise manner. Particularly the acquisition channel growth and the customer lifetime value comparisons.

    Altho' there are lots of opinions/articles (everywhere!) discussing these elements, the MP article library doesn't have such a condensed summation.

  • by Email Monks Thu Aug 29, 2013 via web

    So true Ayaz ! Comparing Email and Social Media typically, Social Media is all through the roof when it comes to the consumer engagement! Email is that big tree that would attract most woodmen’s axe. With a lion’s share of revenue email is still dominating the web as Contrary to social media, efforts in email marketing are easily measurable and with no text or character limitation. Apart, it is amazing to see that organic search leads all the channels for online e-commerce customer acquisition.

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