How many marketers understand Customer Lifetime Value?
As a long-standing Digital Marketer I was there when the Internet started to attract and acquire customers, and even though the channels and complexity have increased, the basic objective remains the same – Cost-effectively grow and retain my customer base.
I was introduced to Customer Lifetime Values (CLV) very early on as I marketed for several online gaming companies over a 5 year period. What I learned in this sector about ROI, attribution models and retention has served me very well when moving to other sectors.
Over the last decade – due in no small part to the expansion of comparison websites – the consumer has become seduced by new sign-up promotions and is highly motivated by price. In the last couple of years, I have noticed a small shift towards service quality as a preference to price as consumers are getting swap-fatigue. They are remembering that trusted brands, regular meaningful communication and a solid value proposition, are actually worth something. It is therefore critical that brands understand their customers in detail and maintain regular relevant communication in order to retain them through positive engagement and loyalty.
Hive has created a datasheet that explains the importance of the CLV, so I’d be keen to hear if anyone else has experienced a shift in short-term acquisition in preference to longer-term retention?
The Customer Lifetime model can also be explored on the website here.