Use the predictive customer lifetime value model to retain high-value consumers

New Ideas in MarketingEssential news for marketers, summarised by YouGov
December 16, 2021, 5:20 AM GMT+0

Optimise customer lifetime value (CLV) to target the most revenue-generating consumers.

CLV is a crucial metric that determines how much value a business can earn from a single customer over time. Quantifying the CLV into monthly, quarterly, and yearly reports can help brands glean insights into high-value consumers and implement strategies that make a difference.

There are several CLV models, including historic CLV, based on historical data to forecast the value of customers and their loyalty. However, the predictive CLV model projects the consumers' value based on their behaviour. This model is effective for customer retention.

Calculating the CLV can help brands discover high-revenue consumers, measure loyalty, build enticing campaigns for valued consumers, lower churn, and boost profits. Brands must live up to their consumers' expectations, improve the average order value, and more to drive CLV.

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