How to Optimize B2B Customer Lifetime Value
Customer lifetime value (CLV)—the total a customer spends on your brand in his or her lifetime—is among the most important metrics for B2B success. It’s also a metric that doesn’t get much play among B2B companies.
In our current business climate, which makes celebrities of start ups, growth is emphasized above all else. So CLV often gets pushed down a company’s list of priorities. It also results in customers feeling underappreciated and undervalued, and the loss of what should be easy and ongoing revenue.
The goal of a powerful CLV strategy is to not only retain customers, but also inspire them to increase spending over time. With returning customers spending 67% more than new customers, generating customer loyalty is an effort your B2B can’t afford to overlook.
Here are our six strategies for optimizing customer lifetime value:
- Collect data from your CRM System
Leveraging this information allows you to analyze the expected lifetime value of customers. Use this data to assess information such as annual revenues, product mix, purchase frequency, and purchase trends.
By including these attributes in your analysis, you’ll generate a more accurate understanding of each customer’s potential. What’s more, your estimation allows you to more accurately segment your customer base.
Segmenting by CLV provides you with an opportunity to understand how to prioritize your attention and interact with the customers that provide the most long-term value.
- Promote customers in your content
By now you’ve realized that social media is a fact of life for businesses hoping to succeed in a growing global market. Make your business matter more to customers by facilitating their online communications efforts.
Use your social media channels to put customers in the limelight by embedding and sharing their posts and positive reviews related to your brand.
Promoting their feedback and experiences will make them feel appreciated and heard. It also encourages them to engage with your brand.
- Pamper customers
Sending customers samples of products and providing discounts on services is common practice for brands looking to get the word out on their products. Procuring reviews by trusted bloggers can grant a business credibility and attract customers on the fence about making purchases.
Also, encouraging a long lasting relationship with influencers can help promote products and innovations your business provides in the future.
- Take customers’ advice, give them credit
Increase customer lifetime value by seeking continuous improvement. Since you provide products and services for customers, listen to their suggestions and then give them what they want.
Utilize online surveys and poll services, such as Polldaddy or Survey Monkey, to streamline and improve the process of collecting this information, making your surveys and polls more effective than a simple social media post that solicits opinions.
Also, send polls out via blogs, social media, and email to ferret out customer demands and offer incentives for participation. This tactic will pay off big time.
If you update or change a service based on customer feedback, credit them. Lay’s Chips is a great example of how such efforts can be mutually beneficial to retaining business relationships.
By soliciting new flavor ideas in their “Do Us a Flavor” campaign, Lay’s benefits by receiving new concepts for their chips and holding onto customers who anticipate new flavors.
- Upgrade customers when they don’t know they need it
Customers that actively engage with your brand are the perfect promoters for prototypes. Send loyal customers products they haven’t tried before or, if you provide a service, offer them an upgrade to premium without any added fees.
Before anyone even knew that online streaming would become the be–all and end–all to their prayers, Netflix provided it to existing customers as a free add-on to their subscriptions.
Its ability to provide customers with a service they didn’t know they could have is probably what put them at the top of brand loyalty charts in 2011 and allows them to continue to dominate competitors.
- Recognize the value of great customer support
With the age of social media transforming the ways customers can access businesses, the culture of customer service is up for quite a bit of change. “If it bleeds, it leads,” is a news idiom that applies just as well to social media as to publications.
In other words, word of mouth spreads negative news like wildfire. However, you can douse it by giving prompt, thorough, and professional responses to every complaint.
Remember to thank the customers who provided positive reviews as well.!
Last Word — Forge stronger bonds with customers
Great customer service is a trait that most successful business share and that you have to provide to customers if you want to retain lifetime value. Help your B2B business forge stronger bonds with customers and prevent churn by setting up a strong customer support team. Proividing engaging customer support is priceless.