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Guest Blog: How Should You Grow and Sustain Your Customer Lifetime Value?

This week we feature an article by Lukas Sitar who writes about growing and sustaining customer lifetime value for the entire customer cycle. While many marketers look at metrics like conversion rates, net profit per sale, average value of a lead, and average customer order, they often overlook their customer lifetime value. This is a […]

This week we feature an article by Lukas Sitar who writes about growing and sustaining customer lifetime value for the entire customer cycle.

How Should You Grow and Sustain Your Customer Lifetime Value?While many marketers look at metrics like conversion rates, net profit per sale, average value of a lead, and average customer order, they often overlook their customer lifetime value. This is a metric that allows you to compete with your biggest competitors, establish longevity in your marketplace, and allow you to maximize the effectiveness of your marketing campaigns.

But just what is customer lifetime value? It’s simply the average profit you’ll generate with your customers over the lifetime of the relationship. By working to increase your customer lifetime value, you can afford to spend more on advertising, out-market competitors, and increase company profits.

The challenge really lies in growing customer lifetime value. Most marketers focus on maximizing the profits from the initial sale, but how do you grow and sustain customer lifetime value for the entire customer cycle?

How to Start the Process of Growing Your Customer Lifetime Value

The first thing you want to do is go after the low-hanging fruit opportunities to increase your customer lifetime value. You want to look at how to increase your average order value and profits by testing different up-sell and cross-sell offers. Don’t assume that your current sales process is good the way it is. Try to optimize your initial sales process as best as you possibly can.

Some ideas for increasing your average order value and profits are to test various bundle deals, offer free shipping for spending a certain amount of money, and explaining why your cross-sell and up-sell offers are valuable to the customer. Most companies tell their customers about other products and services related to their purchase, but fail to mention why these products and services are valuable.

How Huge Growth Can Be Achieved with Customer Segmentation

The next step to growing your customer lifetime value is to start segmenting your customers. There will always be different types of customers for your products and services. This eye-opening case study states that “segmentation has been vital to the success of NIVEA Sun and allowed the brand portfolio to grow to over 40 products.” It shows that Nivea segmented their sun protection products by gender, skin tone, and even age group.

You have to do the same for your products and services. By segmenting your customers into different groups and understanding how these groups differ, you’ll be able to identify product opportunities and create more effective marketing campaigns. For instance, a guitar manufacturer will be able to send targeted offers to customers that listen to hard rock and different offers to customers that listen to blues. It would be far less effective if a generic offer was sent to both customer segments.

Build Engagement and Establish Relationships with Valuable Content

In order to grow your customer lifetime value, there needs to be a connection with your customers. It’s easy for your customers to forget about you when you’re not making an effort to stay in touch with them. The best way to build and maintain this connection is through valuable content.

By producing valuable content and distributing it through channels like your blog, email, social media accounts, and even SMS, you’ll start to build engagement with your customers. If you do this on a continuous basis, you’ll establish strong relationships with your customers due to the value you’ve been giving them. This will make them more receptive to your future offers.

Sustain Your Customer Lifetime Value Through Exceptional Customer Service

How do you get your customers to keep coming back? How do you get them to stay loyal to your business? The answer is to simply provide outstanding customer service. As a matter of fact, 97 percent of consumers say customer service is a big factor when it comes to brand loyalty. But when most companies think about customer service, they think that it just comes down to responding to customer complaints.

Customer service is about more than that. It’s about going the extra mile to resolve customer problems. It’s about sending them free gifts when least expected. It’s about offering deals that are exclusive to them. It’s about listening to customer feedback and actually implementing customer suggestions.

In fact, the same source showed that 89% of consumers switched to another business after experiencing poor customer service. This means that you cannot ignore customer service if you’re serious about increasing customer lifetime value.

Manage Your Customer Lifecycle Properly to Maximize Opportunities

To sustain your customer lifetime value, you also need to manage the customer lifecycle. This basically means the various stages customers go through from becoming new customers, making additional purchases two to three months in, to becoming loyal customers. Proper customer lifecycle management means reaching out to customers in the right manner according to their current lifecycle stage.

In order to make the right decisions, you’ll also need proper customer data management. You want to have access to advanced customer data that will give you a clear perspective of what kind of stage your customer is in, what kind of products/services the customer has bought, what channels they’re using, what pages they’ve visited, and more. You need to look beyond everyday metrics like average order value and customer lifetime value to make the best marketing decisions and get the most value from your customers.

Create Loyalty Programs with Enticing Rewards

Another excellent way to sustain customer lifetime value is to create a loyalty program. Loyalty programs incentivize customers to continue doing business with you because there’s a strong incentive to do so. Loyalty programs are typically run using point or credit systems which can be redeemed as discounts for future purchases.

The problem with most loyalty programs is that the incentives are far from enticing. All they do is offer small discounts for loyal customers. To keep customers coming back long after their first purchase, you need to make sure your loyalty program is actually rewarding.

This means your loyalty program has to offer enticing, exclusive offers to your most loyal customers. This doesn’t necessarily mean steep discounts – it could also be unique experiences, higher levels of service, limited edition products, or access to members’ only clubs. Some hotels and airlines are particularly good at creating these types of loyalty programs. Leverage your product or service to create value for your most loyal customers, and your loyalty program will be successful. 


To sum up, you need to focus on your lifetime customer value to compete. There are many ways to go about growing and sustaining your lifetime customer value. A big part of the solution lies in using intelligent customer data platforms that can help you collect important data and act on that data effectively.

Lukas Sitar is the SEO and Inbound Marketing Specialist contracted with Exponea – Customer Data Platform, where he prepares the B2B SEO content strategy. Lukas’ main focus is to increase the number of sales-qualified leads generated from organic traffic, which he achieves by improving the UX, technical and on-page SEO aspects of Exponea’s website.

For more articles from Shep Hyken and his guest contributors go to Hyken Keynote Speaker

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