Here are 2 ideas, to help you increase the lifetime value of your clients or customers.
To start, you need to understand what their current, average lifetime value is. It’s relatively simple.
For example: If your average client is worth £1000 a year to you in profits and they remain a customer for an average of 5 years, a client’s average lifetime value to you is £5000.
Once you figure out the average value of your clients, consider the following question:
How can you increase their lifetime value, by increasing what they spend with you and the length of time you retain their custom?
1. Increasing what they spend with you
Look for additional, extremely valuable services or products for your clients. Your clients have an existing trading relationship with you. You have earned their trust. They know you. They are also far more likely to buy an additional product or service from you, than from a stranger.
A great place to start is to think of the challenges your clients or customers face. Now, consider how you can help them with these problems, with additional services or products. Yes, it will take time and a little creativity, but the rewards for getting this right are huge.
A wonderful, additional benefit of this approach, is that the more your clients or customers rely on you for a number of services, the less likely they are to switch to another provider. This leads on nicely to the next point.
2. Retaining their custom
Very few small business owners have a structured client or customer retention plan. Your clients are being targeted by your competitors all the time. A well designed client retention plan can help you keep your clients, regardless of what the other guys are doing.
Finding ways to retain, and improve the financial value of your clients or customers, is one of the smartest things a business owner can do.
It makes your business massively more robust, as your client base has no desire to switch from you to another provider. That allows you to plan ahead with greater confidence.
Bonus: By finding products for your customers, rather than customers for your products, you also tap into the fastest way to boost sales and profits.