A while ago I posted on the importance of the Customer Lifetime Value (CLV) metric and the reasons why it is the only way that you should view your customers. If you are unsure of what CLV is, and what the CLV calculation entails, read my previous post on the subject.
Now that you know what CLV is, why it is such an important concept, and how to calculate it, is imperative that your business has the proper foundation to foster highly profitable CLV’s.
Here are 5 ways to increase customer lifetime value among all your customer segments.
1. Quality Products and Services
If you are not giving the consumer a quality product on the front-end there is a very good chance they will not make repeat purchases and will not become a loyal customer. Not only does this have importance for the number of loyal customers that you will have, but it is also crucial to the long term success of your business.
While offering less than quality products may generate some profits in the short run, savvy consumers will eventually see through substandard products and services and profits will undoubtedly decline as a result.
2. Employees Who Stand Behind Your Products
Those that are selling your products should have an appreciation for them, and truly believe in the proposed benefits of what they are selling. Employees should be seen as the most loyal of all customers. If your employees evangelically promote your product it is more likely that customers will view the product favorably and make a purchase, because these employees are seen as experts on the subject.
3. Top-Down Commitment to Customer Service
From the CEO to your salespeople, there should be an overwhelming commitment to having exceptional customer service within your organization. Outstanding customer service is the foundation of any thriving in-store or eCommerce business, and will have a definite impact on customer loyalty and CLV.
If a customer takes the time to file a complaint or air a grievance, they are giving you an opportunity to rectify your mistake. Do not waste this opportunity! Make sure you respond to the individual quickly and truly “go the extra mile” to keep them as your customer.
4. Introduce a Loyalty Program
This is one of the easiest and fastest ways to develop loyal customers. Individuals want to feel like they belong to something, and a well thought out loyalty program can help satisfy this.
When you create a loyalty program make sure that you reward loyal customers with things that are valuable to them. How valuable rewards are to customers depend on what your customers themselves are like – something that will require research to determine. Remember that loyalty programs are not “one size fits all”. There are many different programs that can be catered to suit your individual business needs – we at Smile.io can definitely help with this part!
5. Turn Loyal Customers Into Brand Advocates
Who would you rather have promoting your product: customers who purchase your product once a year, or ones that purchase it on a daily basis? The answer here is obvious; it just makes sense to have those who love your product so much that they purchase it frequently endorsing it. Include as a part of your loyalty program points and awards for those customers that are advocating for your brand, this will in turn cause them to become more loyal – a non-vicious cycle that will benefit your business immensely.
Encourage your most loyal customer to share product testimonials, their experiences with your business, and everything in between! Social media sharing is quickly gaining traction as a go-to source for product information, so encourage your “raving fans” to share their experiences on platforms such as Facebook and Twitter.