The best companies are already using customer lifetime value (LTV) to measure marketing ROI. LTV is a powerful metric for optimizing marketing spend, allowing marketers to look beyond the channels or campaigns delivering first-transactions to identify those that are bringing in high-value, repeat purchases.
But that’s not all you can do with LTV.
To get you started, here are a few product and marketing hacks that leverage your high value customers:
1. Identify and encourage high value behaviors
What are your top customers doing on your site and what could their behavior tell you about other potentially valuable customers? Put your event data to work to answer this question and you can uncover the “golden motions” driving your business. In RJMetrics, you can build lists of your top customers by spend, then analyze what your best customers are doing on your site with Segment SQL data to find this out.
Once you know high value behaviors, you can use engagement tools, like email marketing and push notifications, to encourage users who haven’t taken high value actions to do so. For example, a SaaS company might find that their best customers invite at least two other users from their organization. An e-commerce company might find that repeat purchasers share their new goods on social media within a day of ordering. You could set up automatic campaigns to reach out to people who haven’t taken these important actions and help them to make the most out of your product.
2. Treat your top customers like VIPs
In the average ecommerce store, the top one percent of customers spends 30-times more than the average customer. You should be treating these customers like VIPs. For example, you could identify top customers who were on your site recently. Once your list is ready, export it, upload it to your email service provider and reach out to your best customers with a highly-personalized, tailored offer.
If you’re looking to engage with your very best customers without filling up their inboxes, you could use Facebook retargeting in a similar way. Once you’ve uploaded your list to Facebook Custom Audiences, you can send custom ads and offers to your most engaged, highest value customers.
3. Evaluate how new features are performing
Cohort analysis – or evaluating how a similar group of users behave overtime – is a great way to measure how feature changes are impacting customer engagement. With LTV, you can take this analysis to the next level by segmenting high-value vs. low-value customers.
Did your best customers quickly adopt the new feature? Is it driving low-value customers into the high-value range? Answering these types of questions will help you define and tweak your product roadmap and evaluate if new features were worth it.