7 Ways To Increase Customer Lifetime Value Of Your eCommerce Business

If a customer visits your online store and is struggling to figure it out, then they won’t come back again. Simply because there are many easy options out there. So, it becomes a necessity for you to build a great onboarding experience to reduce churn.

To simplify the onboarding process, tailor it to your customers’ needs by addressing their pain points. Providing how-to guides or crisp videos explaining each step can help with that. It will make it easier for your customer to buy things. And if the purchase is easy for them, they are more likely to come back.

Additionally, you can follow up with post-purchase emails or WhatsApp messages to boost customer satisfaction, leading to a higher customer lifetime value. Don’t neglect your onboarding process as it can make all the difference in retaining customers.

Assuming you know your customer needs better than they do is a grave mistake. Listening to them enables you to have critical feedback and make the necessary improvements and increase CLV.

Conducting polls is an effective method of getting feedback with just one click. To get detailed feedback, you can request customers to write within a 200-character limit, making it optional and not mandatory.

You should also thank them for their time by sending them a mail after they provide their feedback. This is a good way to build stronger relationships with them. By actively listening and responding to customer feedback, you can create a better customer experience and increase customer retention.

If you fail to provide informative content for your customers, they will seek it elsewhere. To avoid that, publish your content on platforms where your target customers are most active, and repurpose it on other channels. If your content is great, it will make you a thought leader in the space and your brand will be seen as trustworthy.

Creating valuable content will help your customers relate to your campaigns as well. This will help you have a better customer lifetime value and let the new potential customers discover you through content.

Schemes like discounts, cashbacks and value points are effective tools to increase CLV and retain new customers. For instance, set a purchase limit after which customers receive cashback, and send it directly to their bank accounts for the ease of use. Meanwhile, offer different types of discounts at regular intervals to ensure that customers keep coming back. Choose from GoKwik’s 200+ discounting configurations to increase effectiveness.

Value points are another great way to offer discounts and incentivise customers to return for their next purchase. Adding a validity period to the discount and sending reminders via WhatsApp, app notifications or even emails ensures customers don’t forget about it, and increase purchase frequency.

By offering discounts, cashback, and value points, you’re providing added value to your customers and building brand loyalty. It’s a win-win situation for both you and your customers, and it ultimately leads to sustainable business growth.

Live chat support is essential for increasing conversions on eCommerce sites. Customers who don’t have access to live chat support may struggle to find help when they need it. With live chat, you can address up to 6 customers at once, making it a fast and efficient way to offer support.

Using a bot ( such as WhatsApp Business APIs) after office hours provides 24×7 support, ensuring customers can make purchases at any time. It’s crucial to ensure that customers feel they’re talking to a real person, not a robot. Being humane and helping customers resolve their issues quickly will improve their experience and ultimately lead to increased customer lifetime value.

If there is a fall in the purchase activity of existing customers, it’s time to use email marketing. Make an email list and use it to promote your products. Customers’ inactivity on your website will not become a barrier this way.

To ensure your emails are effective, offer exclusive offers, early access to new products, and other valuable information. From a customer perspective, they will only check out your mail if you have something inside for them. This approach can revive purchasing activity and improve customer lifetime value.

Upselling and cross-selling are similar strategies to increase CLV but are not the same. You need to know the difference between the two to use them. When you upsell a product, you sell a more expensive version of a particular product. But when you cross-sell, you sell the complementary products of the main product.

Both of these strategies offer your customers better solutions. With improved selling services, the average order value also increases. This is because customers will even go for expensive and complementary products if they suit their requirements, increasing your business revenue.

What is the customer lifetime value formula?

You can calculate customer lifetime value by implementing the following formula.
Customer Lifetime Value = Customer Value x Average Customer Lifespan

However, it is important to calculate customer value before you calculate customer lifetime value. Here is how you can do it.
Customer Value = (Average Purchase Value x Average Number of Purchases)

What is the difference between CLV and LTV?

Lifetime Value (LTV) is the measure of aggregate lifespan spent by customers on your business. It is calculated at the customer base level and not at the individual level.
Customer Lifetime Value (CLV) is the measure of lifespan spent by an individual customer on your business. It is not calculated at the customer base level as it is individual-targetted.

What is customer lifetime value and why is it important?

Customer Lifetime value is the total lifespan spent by an individual customer on your business. This means it is the total revenue or profit an individual customer brings to your business over the time they had with you.
CLV is an important metric for your e-commerce business as it:
– Increases revenue.
– Helps you judge the product demand and quality
– Helps you filter your target audience and onboard them
– Enables you to have different marketing strategies catering to your customers’ needs
– Improves your relationship with your customers by engaging with them and collecting feedback