Understanding Customer Lifetime Value (CLV)

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Customer lifetime value (CLV) is the value a customer brings to your business throughout your relationship with them. It is an important metric that helps businesses understand the total profit or revenue a customer can generate over a period in their relationship with the company.

CLV not only includes how much a customer spends in your business in one transaction, but it is also about assuming that the customer will make future purchases.

CLV helps eCommerce industries focus on long-term strategies rather than short-term goals.

The Significance of Customer Lifetime Value
Customer lifetime value is a powerful value that helps businesses shape their philippines phone number list business strategies. It helps them see beyond individual or single transactions and focus on the long-term value that a customer brings. It is a roadmap to create a loyal customer base.

Some of the factors that enhance the significance of CLV are:

Focus on retention: There is a famous saying that keeping an existing customer is cheaper than finding a new one. Similarly, CLV shifts your focus to customer retention, building strong and lasting relationships, and earning their loyalty.
Smart marketing decisions: CLV helps assess your marketing strategies and budget. Businesses that know their CLV focus their resources on customers, maximising their value.