The Best Way to increase customer lifetime value

While businesses are focused on attracting new clients, many are forgetting that the key to a rise in earnings is finding ways to keep customers and keep them coming back again and again. Did you realize that attracting new clients will cost your organization up to 25 times more than keeping an existing customer? Additionally, a mere 5% increase in customer retention can increase a corporation’s profitability by 75 percent !

How can you quantify how loyal customers are to your brand or company? Customer feedback and interactions over social websites give you a fantastic picture, but to find something quantifiable you will need to appear at customer lifetime value.

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What’s customer lifetime value?

A customer’s lifetime value (CLV) refers to the amount of net profit your company can make from 1 client over their lifetime. You use this metric to assess whether your organization should spend more time and money trying to keep customers or attract new ones in. If your CLV is large, then it is possible to concentrate on bringing new trade. If your CLV is reduced, then you want to spend more time implementing customer retention plans in-store to attempt to boost sales from existing clients.

Customer retention strategies

There are loads of ways which you could enhance your average customer lifetime value in-store, by using everything from promotional signage to dismiss schemes.

Customer service

Customer service leaves a lasting memory in your clients’ minds, whether it was a great experience or a bad experience. Data from RightNow indicates that ‘nearly 90% of customers will shop with your opponents after receiving poor customer service’ [2]. So what can you do to make certain your customers have a great experience in your store and will return?

Your employees are obviously a massive part of the consumer experience, as their knowledge and attitudes can make or break a sale. Make sure that each and every new customer-facing staff member has an up-to-date working understanding of your product ranges so that they’re ready to answer any questions that a browsing client might have.

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In addition to this element of customer service, you’ll also have to consider how the design and operation of your shop impacts upon your client’s perception of your shop. Do you have problems with long or twisted queuing systems? Do customers find it hard to find the products they’re looking for? These issues all contribute to a customer’s overall experience in your shop and whether they will return.

All These areas of customer service play a massive part in your customer retention, since it has been shown by studies which one-third of customers are likely to switch brands after one instance of poor customer support

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Consider Developing a customer loyalty strategy

A customer retention strategy is a superb way to encourage current customers to explore different products in your range by accumulating discounts and rewards. They are acceptable for use in not only retail stores, but also in hospitality businesses such as hotels and restaurants.

By definition, a customer loyalty programme rewards customers who purchase from your shop on a regular basis. These advantages can include discounts, freebies or even early access to new services or products. The concept is that your customers are going to want to keep spending money with you to develop their things and get the reward.

The statistics prove this truth, as studies show that the average basket size of customers that are part of a loyalty programme necessarily increases, and 66 percent of those customers will alter their spending to increase the benefits [4]. In addition to this bonus, clients enrolled in a rewards strategy are also more likely to return for future purchases and to redeem their points or rewards.

“Selling to an existing client is 6-7 times more economical than selling to a different customer.” – SuperOffice, 2020 [5].

Loyalty schemes are incredibly popular with the British people, using a YouGov poll showing that more than three quarters of the population (77 percent ) are already members of a loyalty programme, and three in five people believe that all brands should provide them [6].

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Use in-store promotions to promote brand loyalty

Promotional action in-store is the key to encouraging impulse buys from customers. This can take many forms, such as signage, merchandise displays, samples, and presentations. Whatever promotional action you decide upon needs to be eye-catching, easy-to-understand, and appealing to be able to draw the attention (and start the bag ) of your surfing clients.

“80 percent of customers say they are more inclined to buy something which includes free samples or live presentations.” – Spectrio [7].

Product demonstrations are a terrific choice if you’re seeking to increase sales of food, beverage, and much more complex products that may require directions, such as engineering. They offer a wonderful way for you to demonstrate the many advantages and opportunities your product can give people, in addition to allowing customers to try your product before purchasing, which in turn raises their confidence in the product quality. Here at UK POS, we’ve got various sign holders, poster stands and promotional racks that may help you in making a popular screen in-store.

Utilise upselling and cross-selling

The two upselling and cross-selling techniques work to raise average basket worth, but in a non-pushy manner that helps your clients make the best purchase decisions.

Upselling is when you invite clients to add on solutions to their basket or change to a more expensive version of the product they are buying. Cross-selling is when you encourage clients to purchase compatible extras or supplements to the merchandise they’ve selected. By way of instance, cross-selling are encouraging the purchase of a pair of headphones to a customer purchasing a smartphone, while upselling on this thing would be encouraging the client to get a more expensive smartphone within the scope which has a larger screen.

Upselling has been shown to account for 70-90% of earnings, with only 5-30% of revenue coming from the initial sale (Retently, 2019), therefore it’s very important that you make this technique component of your merchandising plan!

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The trick to upselling and cross-selling is to keep it subtle and not make the consumer feel as though they are being bullied into paying more.

The best salespeople will have the ability to increase revenue and keep that client’s confidence in future, by providing products that genuinely assist and enhance the experience for the client. Subtle techniques include offering free home delivery for orders over a certain amount, buy-one-get-one-half-price offers, and freebies when clients purchase high value items in shop (as an instance, a free 8GB of data a month when you take a 48 month telephone contract).

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Post-purchase communication

The best retailers realise that the consumer experience does not end at the checkout. So as to maximize their lifetime value to your organization, you need to keep them engaged after their purchase to be able to ensure that they return to invest more later on. Techniques to do this engagement include:

  • Offering discounts on future orders through email
  • Television, radio and Social Networking advertisements
  • Asking for product reviews and support feedback

The Rule of Seven countries that clients will need to hear your brand messaging seven times before they remember it, so making sure that your brand is visible to clients long after they leave the shop is crucial to creating loyal customers.

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