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WooCommerce Google Ads Customer Lifetime Value reporting

· 4 min read
Aleksandar Vucenovic

TLDR

  • The Pixel Manager for WooCommerce now outputs the customer lifetime value into the order object on the purchase confirmation page
  • The customer lifetime value is automatically being transmitted with the Google Ads purchase event to Google Ads
  • PMW outputs the customer lifetime value as a sum of all order totals and as a sum of all filtered order values
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This is available the Pixel Manager for WooCommerce from version 1.17.0, free and pro.

Why is this interesting

In order for Google Ads to be able to optimize campaigns for new and or existing customers it estimates the customer lifetime value in the background. But every estimation is just an approximation to the real value. Time gaps between orders of the same person vary and and can be very long, and other factors make this estimation difficult. This leads to an inaccurate customer lifetime value which is being used for campaign optimization.

Since WooCommerce has all the data we need for an accurate calculation, we went ahead and built this into the Pixel Manager for WooCommerce.

The Customer Lifetime Value Output to Google Ads Is Only Available in the Pixel Manager for WooCommerce

As of this writing, the Pixel Manager for WooCommerce is the only tracking plugin that transmits the customer lifetime value directly to Google Ads. The reason is, that Google has not yet written any documentation about how to achieve that using gtag.js. It is possible using the Google Tag Manager. But, there is no help article for this either.

With a little bit of reverse engineering we figured out how to transmit the customer lifetime value using gtag.js. It's there, it's just not documented yet.

Therefore users of the Pixel Manager for WooCommerce belong to the first ones who can start using this feature. And as a user of the WooCommerce Pixel manager you don't even have to do a thing. PMW will send the value to Google Ads automatically in the free and the pro versions.

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How PMW Calculates the Customer Lifetime Value

We have to be careful about what we send as the customer lifetime value to Google Ads. This could be based off of the total order value which includes shipping and taxes, or excludes shipping and taxes.

And, the Pixel Manger for WooCommerce allows you to calculate your own order total logic. What would be the correct customer lifetime value in that case?

The answer is simple. The order total logic for the customer lifetime value must be the same as the order total logic that is being used to sent the purchase conversion value to Google Ads (and the other pixels).

The important bit is, that we use exactly the same calculation. And if we use a filter for the output, we need to use the same filter to calculate the customer lifetime value.

The Pixel Manager for WooCommerce makes this really easy for us. It outputs the clv_order_value_filtered into the order object on the purchase confirmation page. PMW uses the same calculation logic, including any custom filters, for the customer lifetime value of that specific customer to calculate the clv_order_value_filtered.

How PMW Handles Guest Orders

Many customers don't create a user account and log into the shop before they purchase an order. And even those visitors who have a user account, sometimes purchase as guests, without having logged into the shop beforehand. If we were only looking for existing orders by searching for orders of logged in users, we would miss out a large portion of orders that belong together. This is why PMW doesn't use the WooCommerce customer ID to search for past orders. We think it is safe to assume that customers usually use the same billing email. It might not be true in all the cases, but certainly most of the cases. Therefore the Pixel Manager for WooCommerce takes the sum of all paid orders that have the same billing email to calculate the customer lifetime value.

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