5 Proven Ways to Increase Customer Lifetime Value
It is understandable for businesses to aim for a wider audience. However, do not underestimate the power of your customer loyalty.
Not only can they ensure stability and bring growth even during the worst of times, but you must also consider the potential revenue that each of them can bring your company.
Customer Lifetime Value (sometimes also known as CLV or LTV) is a business metric that refers to how much a business can earn from a consumer over the course of their relationship. The more loyal your customers are, the higher your CLV is and your revenue.
In this article, we are going to share with you five tried-and-tested ways to increase your CLV and make sure that you are maximizing what you can earn from your investments.
1. Set a Lasting First Impression
How much does your business spend on acquiring new customers? Did you know that it can significantly impact your CLV as well? It is crucial for you to make the greatest positive impression possible during your onboarding process to ensure a memorable experience that will make your customer keep coming back for more.
There are different ways to do so, like the following:
- Make your product more accessible. Your onboarding process should be as easy and as frictionless as possible. Investing in social media marketing is a great idea. Make an effort to not just advertise your product and services, but to bring them closer to your target market so that purchasing them is only a couple of clicks away.
- Get more relevant information out there. This is particularly important for brands that are offering something new and unique. Offer walkthroughs. Improve the quality of your FAQs page. Invest in filming quality video demos and tutorials. Create content that highlights how relevant your products and services are to your customers’ lives.
- Invest in website development. Improve your website speed. Establish a strategic funnel that will walk your new customers through the entire sales process. Make sure that every aspect of your website is as straightforward as possible.
2. Keep Your Customers Engaged
The onboarding process is only the first step. Remember, you’re not just making an effort to acquire new customers. More importantly, you are working to make sure that your customers stay loyal for as long as possible.
Thus, you also need to focus on customer engagement. Here are various ways to do so:
- Interact with them on social media. Reply to their comments. Appreciate them in your posts. Save some space on your social media channels to feature user-generated content.
- Invest in email marketing. Email is not dead. In fact, it is one of the best ways to boost customer retention. The problem is, a lot of businesses go about it the wrong way. Don’t just use it as a vehicle to promote your product.
Instead, use it as leverage to reach out to your customers and add value to their life through relevant, high-quality content and bonuses.
- Consider alternative ways to boost their quality of life. This is probably the most important tip that we can give you. There are numerous ways to touch your customer’s lives, but for us, we have found that working with a local lending network to provide point-of-sales financing to be the most impactful.
After all, it gives your customers more purchasing power with less prejudice and judgment compared to more traditional ways of acquiring credit.
3. Expand Your Network
You might not be involved in B2B sales, but it wouldn’t hurt to collaborate with other brands, especially with the intention of making your customer’s lives more convenient. For instance, suppose you are an events organizer. Wouldn’t it be great to work with photographers, make-up artists, and other professionals and business owners involved in the industry?
You can even come up with a way to offer each other’s customers a special discounted rate. You will not only be tapping into your partner’s network, but you’ll also be giving your own network a chance to take advantage of such services at a more affordable price.
4. Improve Your Customer Service
Nothing ruins a business and customer relationship faster than a lapse in customer support. Make your customer service more accessible by providing more communication channels. It is ideal to have at least three ways for your customers to contact you. Social media, live chat, and phone support are the most commonly used, but we highly recommend doing some research to determine the channels that your target demographic is most active on.
24/7 support is great, but don’t forget to prioritize increasing your response time as well. Invest in providing quality training as well.
Surveys report that 84% of customers expect companies to respond to them within 24 hours after reaching out via social media, while 72% expect a response after an hour after reaching out via Twitter.
5. Listen to Your Customers
Finally, increasing CLV is a never-ending effort. Fortunately, you will never run out of ways on how to do so by simply listening to your customers. This task is easier said than done, though, especially if you have various channels where you get feedback.
Ideally, you should have a team solely dedicated to collecting and poring through customer feedback, looking for actionable steps that you can do to improve your business.
You may also look into platforms, applications, and other digital tools that can help manage both your positive and negative reviews and keep track of those that you should continue doing, the complaints that you have already resolved, and more importantly, the most pressing issues that you should prioritize.
By keeping the tips we have shared with you in mind, we’re sure that you will be able to boost your CLV, and in doing so, ensure business success. Good luck!
Guest post courtesy of Martha Pearson