The use of the LTV indicator in marketing practice will help:
One person will buy a product from you once for 5,000 rubles, and another will become a regular visitor for many years. As a result, he will bring the company several times more money than the first.
- Optimize brand promotion costs. Are you ready to spend more on advertising? LTV will show the need to change the company’s marketing indonesia phone number list budget. Perhaps it is worth abandoning some channels and tools for working with the audience in favor of others. For example, install a product recommendation feed on the site to increase the average check.
- Develop strategies for each segment. Identify groups of loyal customers and offer them individual programs, order conditions or bonuses.
- Find weak points in the sales funnel. People register on the site, but disappear after the first order? Try setting up mailings to remind about yourself and bring the client back.
- It is rational to plan your marketing budget. You know exactly what you are paying for and what results you expect to get. Avoid useless advertising and direct money to more profitable promotion options. For example, if the customer value indicator in social networks is 2,000 rubles, and in contextual advertising – 1,000 rubles, then it is worth developing a corporate community.
How to calculate LTV: formulas, technology, features
There are several ways to calculate brandi hammond analista de rrhh a company’s LTV. Some are simple and accessible, while others show more accurate values. Each company decides which one to choose, depending on the request and available data.
To calculate the lifetime value of a customer, rich data refer to the available customer information and statistics. Business analytics systems and customer databases will come to the rescue. For calculations, you will need:
- the amount of income for a certain period – a month, six months, a year;
- duration of work with a client – how long a person interacts with the brand;
- number of clients;
- average number of orders;
- average bill;
- number of sales to one customer;
- cost of an advertising campaign;
- percentage of regular customers.
The more data is used in the calculations, the more accurate the result will be. Below we offer several formulas for determining the lifetime value of a customer.