Firms can grow their revenue by focusing on acquiring new customers or by expanding the revenue from existing customers through cross-selling or upselling, and reducing customer churn. The key questions are which of these two paths is more sustainable, which of these two paths companies pursue, how successful they are, which marketing metrics to use to identify the pursuit of which path and how to identify this pursuit if companies do not disclose these marketing metrics.
At MASB Summer Summit 2025, Aug. 13-14 at DePaul University in Chicago, Professor Bernd Skiera from Goethe University in Frankfurt, Germany, will present: Growing Your Brand: New or Existing Customers?; outlining how revenue cohort tables contain all the required information to estimate revenue retention rates and to describe how strongly firms grow by acquiring new customers, how those new customers compare to existing customers (as reflected in the “cohort effect”) and how existing customers develop over time (as reflected in the “age effect”).
The empirical study covers 30 firms over seven years across three industries: online marketplaces, online subscriptions, and cable/satellite services. It explains how to derive a revenue cohort table and revenue retention rates for each firm—even when none of the 30 firms discloses this information. Its results reveal that most firms exhibit average revenue retention rates below 100%, with declining rates as customers mature (i.e., a negative “age effect”), making them highly dependent on revenue from new customers to further grow. Additionally, the revenue of new customers compared to existing ones varies significantly across firms (the “cohort effect”). However, the age effect has a stronger impact on revenue than the cohort effect.
Skiera took over the first chair of Electronic Commerce at Goethe University in 1999. In addition, he’s a member of the managing board of the efl-The Data Science Institute and the Schmalenbach Society. His research interests include MarTech and SalesTech, electronic commerce (especially Amazon Market Place), online marketing (in particular programmatic advertising, real-time bidding, and pricing), marketing analytics (including machine learning), the evaluation of the economic impact of more online consumer privacy and value-based customer management (Customer Lifetime Values, Customer Equity, Customer-Based Corporate Valuation).
Meet Professor Skiera at MASB Summer Summit 2025 in Chicago! Request your invitation from events@themasb.org.