How to Master Customer Value Optimization
Customer Retention, Customer Value Optimization, Guest Posts, RFM

How to Master Customer Value Optimization

The struggle to gain a steady flow of traffic is real. In fact, you may already be drawing a generous amount of traffic sources, but getting them to convert is where the true challenge lies. 

The digital marketing space is constantly evolving, and marketers must keep up with the growing demands of consumers to maximize leads. Essentially, it all comes down to nurturing customers on their buying journey and giving them what they want, provided it benefits your business bottom line as well. 

How does one manage to nurture leads while also inviting maximum profit? The answer is pretty simple; Customer Value Optimization System.

Would you like your clients stick to your brand? What about increasing your Customer Value? You’re in the right place.

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Find the Best Market Fit

One of the pillars that form the foundation of businesses is the value of their targeted audience and customers. Many businesses forget to meet the interests of their audience and concentrate more on what the competitive market has to offer. Many purchasers keep an eye out for anything that is unique and useful for their daily routines. 

So, the key factor that a business needs to focus on to convert its targeted audience is to fulfill a need.

  • See A Need, Fill A Need

The first stage of finding the right fit in the market is picking out the problems that your targeted audience can encounter. Customers don’t actually buy a product because of its name; rather, they focus on the transformation that it can bring to their daily life. To remove anxiety, discontentment of any form and replace those with the feeling of calmness for the challenges they may face ahead.

So, a startup can first make a list of the kinds of troubles their target audience is facing during the current global crisis. Find the area that can make your business easy to combine with and which will stay on demand for a long period of time. How can online stores help people at this time of uncertainty? Look for the answers and plan the next move. 

Create a Lead Magnet Offer

The best thing about leveraging a lead magnet is that it’s completely free, and it’s one of the simplest ways to offer value to prospects in exchange for their contact info. After some research about your target audience and their interests, you can devise an offer that’s a deal-breaker. 

Basically, the lead magnet will consist of a resource or material such as an e-book, white paper, checklist, or a guide. To avail of this offering, the prospect will provide their email address or contact info, and brands can send them email messages to keep them interested. 

Most importantly, you don’t need just one lead magnet. If you’re starting a digital business, you can create multiple lead magnet offers catering to different groups of audiences, and the ones that download your resources are more likely to buy from you. 

Examine CLV and the KPIs That Influence It

The customer lifetime value is a prediction of how much a customer is foreseen to spend on your products during their relationship with your brand. The greater the CLV, the higher the profits. Knowing your clv figure can help you figure out where you’re standing as a business. One way to realize where you stand is by monitoring the KPIs that influence your CLV.

Calculating your Customer Lifetime Value is not an easy job. Hopefully we have a solution that can do this automatically.

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RFM Distribution 

Grouping or segmenting your audience can help you discover vital information about your most loyal customers. This helps you gain a positive response, increased devotion, and boost your overall customer lifetime value. You can differentiate your customers by putting them into groups from most frequent buyers to customers who no longer visit your pages. 

In-between, there is a type of buyer that purchases from your business every once in a while but isn’t considered loyal. Identifying these types of customers based on recency, frequency, and monetary factors can help business executives to focus on improving CLV for the right customers.

Are you dreaming of calculating your customers’ value faster?
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Customer Experience

While customer experience isn’t directly measurable, there are certain KPIs that can help you assess the performance and service of your products.

  • Product reviews: It is important to gauge the general sentiment about your products from customers. Do they like them? Do they hate them? By finding out what people are saying about your brand, you can monitor the performance of your products. 
  • Customer effort score: This helps you record the amount of struggle and ease a current customer has in using the purchased product, finding a problem, and solving said problem.
  • Product return: If you receive a lot of complaints about refunds, then it means that your product may be lacking in a few areas; a high return rate means that your product needs to be improved and tested to ensure that it is free of any complications.
  • Resolution rate: Are your customers content with the services provided by your company? Is there room needed for improvement? How quick are your employees in fixing the issues of your customers regarding the purchased product? 

Conduct Qualitative Research for Each RFM Group

To better understand why some of your customers are more valuable than others, it is important that you do some qualitative research by holding surveys and quizzes for your customers, starting with demographics, reasons to buy, and other custom based questions regarding their goals. You can hold these surveys via email, or you can even choose live interviews (Zoom, phone calls, etc.). It’s understandable that your RFM groups during the pandemic may not look similar to your pre-pandemic findings, but uncovering this data is essential to identifying valuable insights about your customers. 

Map Your Customer’s Journey 

You should map your customer journey by examining every interaction that your customer has with your business. This process enables you to find areas of improvement and make them better by creating an ideal customer retention strategy based on your findings. 

Would you like your clients stick to your brand? What about increasing your Customer Value?
You probably want them both.

Take a ride with to get the

full potential out of your business.
(FREE on Shopify)

When mapping your customers’ journeys, you also need to consider implementing a return path. The point of a return path is to bring back customers to the start of your sales funnel and convince them to make the first purchase with your business. This could be via email marketing strategy as you send personalized messages to customers in hopes of capturing their attention and causing them to buy again. 

Since you already have their contact info from the lead magnet, it’s much easier to market to them to convince them to return. By offering tripwire, core offers new lead magnets and profit maximizers; you can get them to buy a product they didn’t get the first time. 

  • Tripwire Offer 

The first exchange is known as tripwire, which is where you persuade the prospect to make a small purchase to break through the hesitation of doing business with your brand. Tripwire offers are generally meant to be irresistible and what today’s consumers consider to be a “steal.” This could be a discounted deal that allows customers a trial of the product with all the features available.

  • Core Offer 

This is the main attraction and the product that people come to purchase from your business. This is the deciding factor that your product or service is worth the investment and usually comes after a customer has made a minimum of two purchases from your business. It seals the deal, and there’s a higher probability that the customer will return to make bigger transactions. 

  • Profit Maximizers 

These are the items that go well with your core offerings and further enhance the value of your products. In simple terms, they’re targeted towards elevating the customer experience by marketing products that uplift the performance of your actual product. Keep in mind that people are either afraid or aren’t recommended to step out of their homes to go shopping. So your e-commerce store is their destination. Use this information to market the right products that can pair with your original offering. 

Define Your Ideal Customer Profile (ICP)

You can easily identify your ICP by following the introduction of RFM and the discovery 0f your best customers by gathering the data you acquired from the RFM analysis. When you are creating your ICP, you should make sure to include the following:

  • Who are they (location, age, gender)
  • What they buy (product assortment)
  • When they buy (buying habits)
  • What they need further (qualitative research)
  • What keeps them coming back (reasons and barriers)

Create and Target Personalized Campaigns across All Channels

Once you’ve identified your most frequent buyers, the next step is ensuring that you remain at the forefront of their minds. The way to do this is by directing personalized campaigns to keep customers engaged on all your channels. 

For this to work successfully, you’ll need to refer to your RFM groups and identify the most valuable customers to upgrade your personalization efforts. This means your most loyal customers will get special alerts to new product launches, discount deals, and other exciting news before other customers. 

The idea of personalization is to make the customers feel valued, which in turn boosts their engagement and drives more sales. 

Final Thoughts on Mastering the Art of Customer Value Optimization

Each of these tactics goes hand-in-hand like the pieces of a jigsaw puzzle. In order for them to work, they must fit together in a way that makes sense. Organizations that value this approach from an early stage can effectively scale their business and maximize profit. Your goal shouldn’t be to just drive in traffic but to curate those members that are guaranteed to invest in your business, and CVO can help unearth those prospects.

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