IMPROVE LONG-TERM RELATIONSHIPS & INCREASE CUSTOMER LIFETIME VALUE
. The measurement forecasts how much an individual customer is worth to your company over their lifetime. And the higher your CLV, the better the growth and stability of your business in the long-term. The CLV is not necessarily concerned with your next conversion or the results for the next quarter—it teaches you to focus on the long-term strategy of your relationship with your customers.
WHY IS CUSTOMER LIFETIME VALUE SO IMPORTANT?
Of course, customer acquisition is vital. You must attract new leads to grow and diversify your business. But it’s your returning customers and your repeat orderers that will ensure the long-term stability of your business.
Loyalty programs are a sure-fire way to keep your customers engaged with your business, which means they’ll be more likely to buy from you again and again. The act of receiving a reward for each purchase can encourage habit-forming behaviours—which ultimately means more customers returning to your store. And more than this, it provides another opportunity to differentiate yourself from your competitors. Maximising CLV is all about nurturing the relationship you hold with your customers, and a loyalty scheme is another touchpoint you can use to achieve this aim.