How to Increase the Lifetime Value of Customers
Author: Maria Alejandra Lopez
Source: Cutomer Think
As a business, your focus is on getting customers to consume your products or services. The truth is that retaining customers is easier than finding new ones. That’s why it’s imperative to keep them in mind when you’re growing your business.
Customer lifetime value or CLV is defined as the total worth of one customer over the lifetime of their relationship with your business. It’s worked out by deducting the costs of getting and servicing a customer from the revenue the company has earned from them.
Here are ways to improve your company’s CLV.
- Getting customers on board
Onboarding is the process whereby the business integrates a customer into the company’s activities by familiarizing them with the available products and services. Your onboarding should be convenient and uncomplicated.
It should be focused on your brand and making your products and services accessible. When customers feel they need to jump through several hoops to do business with you, they’re unlikely to return.
The aim is to foster recurring engagement and increased revenue generation. Remember that word of mouth marketing is still a force to be reckoned with in the business world. Successful onboarding practices will make it easier for customers to recommend your organization to others.
- Customer Relationship Management (CRM)
Improving and maintaining business relations with customers is essential to enhancing CLV. When a business is in its infancy and has only a few clients, it’s easy to make them feel valued. In larger companies, the personal touch gets lost along the way. This is not intentional; it’s the result of a burgeoning customer base.
CRM technology and software help a business keep track of its customers. Every client has the potential to offer you repeat custom. But the onus is on you to ensure that it happens.
Keep in touch with your customers with regular correspondence that highlights your current offerings. Offer them excellent, professionally written content in your communications. It helps to keep your business at the forefront of their minds.
- Customer service
Your product or service might not be that different from what your competitors offer. But your client service practices are a way of distinguishing yourself from others. Providing a high standard of customer service is a guaranteed way of ensuring repeat business.
Another way of securing customer retention is by offering 24-hour support and service availability, especially if you have clients in different time zones. Offer a live-chat option for customers to access the help they need.
In doing business, things go wrong. Even the best-laid plans can go awry. What’s important is how you deal with it. When clients see that customer service is a priority, they will not only buy from you again, but they’ll also recommend you to others. Invest money in your client service representatives as they are the face of your business.
- Study customer behavior
It’s vital that you understand customer trends. Look at their buying patterns so that you know when and how to approach them. Find out which social media platforms they utilize.
Use these platforms to reach them and people like them. Examine the questions customers frequently ask. Draw up an FAQ section on your website. Offer blogs, video tutorials, and step-by-step guides to make things more convenient for them.
To improve CLV, you should rely heavily on the feedback you get from customers, both positive and negative. Ask specific questions when gathering feedback so that you can get the data you need.
Feedback guides you in the decisions you make for the company’s future. Common pain points customers experience can dictate the improvements your product or service and your entire brand need.