According to Ben Simkin, one of the best ways to grow your business, and ensure continued growth of your business is by understanding and working to increase the Life Time Value (LTV) of your customer. LTV is a way to be able to predict the growth of your company, providing you are taking the necessary steps to retain your clients on a long-term basis. Most clients determine the success of their business by the number of clients they have, and not by the value that each customer will provide the business in terms of growth over time.
Ways to Assess the Life Time Value of Your Customer
– How much does your average customer spend with you on their first purchase?
– How many times a year will they be purchasing from you?
– How many years over their lifetime would they be purchasing from you?
More Profit with fewer Clients
Many companies value their operations and success based on the number of customers they have, thinking that if they have hundreds of customers, they may be doing something right, says Ben Simkin. Where this falls short is that while it is a great thing to make as much money as you can by selling your product or service, you are literally leaving money on the table if you don’t put efforts into increasing the Life Time Value of your client.
How to Increase Life Time Value?
According to Ben Simkin, Life Time Value is an approach towards your client relationship that has to show your clients that you are not in it for the short-haul when you take them on as a client. It is all about retaining, and doing what you can, including to never stop marketing to your current and past clients, to help maintain and increase their Life Time Value.
– Increase the number of things they buy from you: Ben Simkin says that while dealing with a new client, you may sort out various new needs that they have to emerge that you will be able to fill. Perhaps it’s providing them with a variety of product or service, or finding what they need in a way in which you can profit from.
– Get them to come back to you more often: As LTV depends on how many times a year the customers buy from you and for a number of years. If the customers are buying from you only once in a year, then you need to increase their need to approach you often in a year by finding various approaches.
The author of this article has been working in an online marketing company for over 2 years. In this article, he has mentioned few ways to increase the Life Time Value of the clients provided by Ben Simkin. Visit http://businessnet.com.au/