Time to ‘Retink’ Customer Lifetime Value (CLV)

CLV as a metric helps you measure the total amount you expect from a single customer for the entire business relationship.

How do you achieve CLV?

Customer success and support team have a great impact on this during the customer journey. Their recommendations and problem solving skills help increase customer loyalty and retention.

Why is CLV important for your business success

Insightful CLV Can Help Target Ideal Customer

With a great insight on CLV, you can recognise customer segments that are valuable to your business and target it for maximum result.

This simply means making sure businesses that you get the most revenue from are served with products/services that make them happier, which would increase customer satisfaction and make them even buy more.

CLV Can Identify Challenges That Will Help Boost Customer Loyalty

By constantly reviewing your CLV you can get significant results with customer loyalty and your customer support strategies thereby reducing the chance of a low CLV.

Decreased Customer Acquisition Cost

By simply increasing your CLV you can reduce your customer acquisition cost. An article from the European Business Review indicates that it is five times more expensive to gain a new customer than to retain one. Astudy from Bain & Company confirmed that if you increase your retention rate by 5%, your profit could go up between 25% to 95%.

How do you achieve CLV?

Customer success and support team have a great impact on this during the customer journey. Their recommendations and problem solving skills help increase customer loyalty and retention.

3 Ways to Improve Your CLV

You Should Increase Your Average Order Value

One of the best ways to improve your CLV is by crossselling and upselling complementary products specially at check outs. Amazons and McDonald’s areprime examples of this.

For SaaS startups or subscription based companies, you could do this by making your customers see the benefits of switching to an annual subscription. This may seem insignificant however a small increase in order value over a period of time leads to an increased CLV and revenue.

You Should Aim at Building Long Lasting Relationship

Make sure to offer your customers best prices and quality for your products and services and they would definitely return for more. Use social media to build personal relationships with your customers and watch the bond growover time and the reward that comes with it is an increased CLV.

Be Open to Advice from Customers

If you want to be a leader in your industry, you have to learn to listen to your customers and interact with them based on their advice. In fact, you should even reach out to some individuals with rewards and tokens if you implemented advice from them that helped your business. The best way to seek advice from your customers could be through polls or surveys.

Not everyone would participate but amongst those who participate, there is a great chance that if you reach out to them and implement their ideas you could become your loyal customers because it shows you are willing to listen and you are ready to solve their endearing problems.

If you want to increase customer loyalty and revenue over a long period of time, you definitely should pay attention to your CLV as it is a key metric for your business long term success.

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