Long-term buyers are the best. These titles will help you encourage shoppers to stick around for years.
You owe quite a bit to your brand-loyal, long-term buyers. Without their repeat business, you’d have no dependable source of income. So, why not focus your attention on keeping them happy? When you do, you’ll get a serious benefit in the form of a higher average customer lifetime value (LTV).
Not currently tracking your overall LTV rate? You can figure it out fairly easily. First, determine how many visits a typical customer makes to your physical or online store annually. Multiply that number by the average purchase amount spent per visit. Then, multiply the annual figure by the number of years a customer stays with your organization.
For instance, say that customers tend to buy from you twice a year at $50 per purchase. This means they spend $100 yearly. If customers “churn” about every three years, you can estimate that the LTV of a customer is around $300. Now, you have a starting point and can start to make tweaks to get the LTV bottom line to increase.
Why pay such close attention to your customer LTV? It costs about five times less to keep current customers than to replace them, according to OutboundEngine research. Plus, the longer you know your buyers, the better you can understand and serve them. And don’t forget that a raving fan base will give you an organic positive branding lift. In other words, you get more marketing for your products and services for the same budget!
Of course, figuring out what to change to bring about a more impressive LTV can be tough. To help you get some ideas, get a little closer to the following books aimed at making your customers happy.
1. The Hawke Method by Erik Huberman
Entrepreneur Erik Huberman centers his book on three pillars that he refers to as the principles of marketing: brand awareness, customer nurturing and buyer trust. He uses his years of experience to show how to close sales faster and hold onto the best customers longer.
Written in a straightforward, conversational style, The Hawke Method can help you refresh your marketing strategy to improve your customer LTV and, ultimately, your ROI. Huberman explains why you need to nurture early and often to avoid preventable prospect churn. Remember: Everything you do during those first critical touchpoints matters. Make certain that you’re engaging with your prospects the right way so they hang around and maybe turn into your loudest cheerleaders.
2. You’re Invited by Jon Levy
You’ve invited your customers to join you at the table. Yet are you delivering them a customer experience (CX) that leaves them practically speechless? Jon Levy uses his behavioral science background to lay out methods for you to form deep and lasting connections with the people who’ve chosen your brand instead of another.
You’re Invited will encourage you to think of your customers as part of a distinct, exclusive community. Levy rose from “unknown” status to a well-known international figure, all thanks to the knowledge of human habits he shares in his book. Leverage his suggestions to establish a tighter, more meaningful affiliation with customers so they’re more likely to stay.
3. Extreme Ownership by Jocko Willink and Leif Babin
Sometimes, the needle that will motivate your customers and inch up your LTV doesn’t come from the place you assume it would. For example, perhaps your customers leave because your teams aren’t headed up by the right kinds of leaders. In this case, pouring over Extreme Ownership might give you insights into how to close your leadership gaps.
Written by former U.S. Navy Seals-turned-consultants, Jocko Willink and Leif Babin lay out a plan for making sure your departments and company run smoothly and effectively. By streamlining your internal management decision-making and systems, you can avoid and mitigate problems that lead to customer dissatisfaction.
4. The Little Customer Service Book by Rick Grassi
Sometimes, we end up making everything seem too complicated. That includes the way we approach customer service. One method to get the edge on your LTV number can be through taking an old-school approach to service and support. Enter Rick Grassi’s guide, The Little Customer Service Book.
Though small in size, this book touches on some wide-ranging topics and promises big “Eureka!” moments. It’s worth passing this around to colleagues before brainstorming sessions just to get everyone’s imagination flowing. If your communication has slipped off track, your customer LTV can’t be far behind. Get back to basics and wow your buyers with knock-their-socks-off service that leaves them asking for more.
Every time a customer chooses to buy again, you’ve hit the jackpot, so heed these books' insights and make sure to position your business to stay on a winning streak by keeping abreast of the health and growth of your customer LTV.
Image: Harper Business & Morgan James Publishing & St. Martin's Press & Rick Grassi
Here's how to close the feedback loop and enhance your brand in ways you haven't even thought about.
Modern businesses can use all sorts of tools, including automation, to collect information about what customers think, want and do. Many companies unfortunately don’t tap all of the potential concealed within that data. Closing the feedback loop and creating a solid sequence of two-way communication can improve how happy customers are with you and empower your happy customers to be valuable ambassadors for your brand.
The importance of a two-way relationship
Customer feedback allows you to spot and fix small problems before they balloon into big issues. It’s thus a viable tool to reduce churn, manage risk and protect your reputation. Even when you're operating well and customers generally are happy, listening to what people are saying can bring them into your innovation process. They can have a much more direct influence on what you offer and how you design. You also have the chance to let them advertise for you, such as offering coupons for referrals.
Despite these benefits, the number of businesses that don’t take full advantage of a closed feedback loop is high, and they stand to lose out on profits and market share, even though those losses are entirely preventable.
Why so many companies still have a feedback gap
Companies often struggle to close the feedback loop because they do not create a clear process for what should happen after they collect information from the customer. They might not specify, for instance, who should see the information first, or that they have to filter the data according to defined parameters. They can also have problems with technical infrastructure,where it’s not clear what hardware or software is necessary, or they don’t have integrations available to perform beneficial tasks.
This issue relates to data democratization and the traditional, hierarchical approach to business. Once companies have information about the customer, they typically do not make that information available company-wide. Employees have to work with the information in fragmented ways and might not be aware of everything other departments are working to do. That lack of cohesion complicates internal efforts to understand the big picture of the customer journey, ideal next steps or the kinds of resources the business can use to reach out.
When you can, automate
Closing the feedback loop requires your employees to attend to individual customers. If a customer submits a negative survey, for instance, an agent should be able to step in, contact the customer and take customized steps to improve their satisfaction level so that they don’t leave. But this doesn't mean that the processes you develop for closing the feedback loop must be entirely manual. You could have a system, for example, that automatically triggers a notification to an agent if a net promotor score drops below a certain level.
Amazon is a business that integrated automation successfully to close its feedback loop. The size of their business meant they had to work with millions of pieces of feedback and that a manual process wasn’t practical. They created their own solution by implementing machine learning and developing customized algorithms that would trigger follow-ups. They carefully tagged the customer data to ensure that messages were properly personalized to build trust, and they encouraged customers to view the changes Amazon was making. The end result was that customers who participated were more likely to recommend the company.
Simple best practices
No matter the size of your business or specific industry it operates on, the sheer amount of data available from customers means you have to stay practical as you organize, analyze and respond. Small-business software expert Kathleen Carroll recently outlined three best practices to follow for Motley Fool:
"Focus on the product first. Customers likely will tolerate other issues better if your product is excellent."
Respond to every customer. This doesn’t mean you have to tailor every answer. But do respond so that customers feel heard and understood, and don’t leave issues hanging."
"Apply the Pareto principle. Resolving 20% of complaints typically will solve 80% of customer issues. So look at where you can have the greatest impact and focus your efforts there, rather than worrying about fixing everything.
Within these guidelines, there are generally six key elements of closed-loop design, including:
Broadly, we can view closed-loop management on two levels. The inner loop deals with individual-level feedback from the customer, whereas the outer loop involves the entire organization and might require strategic changes to policies, pricing or other elements.
Does your company have the two-way communication necessary to thrive?
Closing the customer feedback loop might require you to make significant changes to the way your business is organized or the tools it uses. It’s worth the investment, however, because of the extent to which the customer relationship solidifies your operations and market position. Setting yourself up for a closed feedback loop can also help unify the company as all of your employees gain access to customer data and know their role in applying it. And it can include automation so your team stays efficient.
So don’t drop the ball. Ask yourself whether you’re really creating the two-way communication you need to let all of your customers be happy and work for you. If you’re not, today’s a great day to be proactive and change.
Image Credit: Gino Crescoli from Pixabay
Cutting prices for products or services may seem a tempting proposition, but it comes with significant consequences.
One of the biggest mistakes I see entrepreneurs make is relying on sales or otherwise discounting their product or services. While this may be helpful in getting rid of old inventory or giving a business a quick revenue bump, I’ve never found it to be a successful strategy in the long run unless it’s done properly. Why?
1. Lower price is perceived as less value
Most of us believe that you get what you pay for; whether it’s a product or service, we unconsciously associate higher price with higher quality. When I was working as a realtor, it was fairly common for agents to discount their commissions. I rarely did. I worked very hard to become good at my profession, was extremely knowledgeable and gave clients exceptional service. If a person didn’t want to pay what I was worth, then they didn’t appreciate the benefit I could bring to them as their agent. Fortunately, I had plenty of clients who did appreciate it and were happy to pay my full commission.
So, ask yourself, “Do I really want to build my business on clients or customers who don’t value what I have to offer — who don’t think I’m worth full price?” (By the way: Most entrepreneurs will tell you that when a client asks for a discount, they almost always turn out to be a big pain in other areas as well!)
2. You become a “commodity” rather than a true value proposition
A commodity is interchangeable and replaceable, and you don’t want what you offer to be just another something that customers can find anywhere, from anyone. Instead, it needs to have a unique value proposition; when you offer a commodity, the only thing you can do is lower prices to compete in a competitive market, and there will always be another business that will come in with prices lower than yours. Put simply, there is no benefit to being the lowest or second lowest in price, but when you have a unique value proposition, you set yourself apart — offer something that no one else in your industry does, so price is not an issue.
Ask yourself, “Do I want my business based on the never-ending battle of lowering price to stay competitive?” Wouldn’t you rather increase your value instead?
3. You’re training people to wait for the discount
Think about it: When a service or product goes “On Sale!” frequently, don’t you wait to purchase it until the next sale? Everybody wants a good deal, so they’d almost feel foolish paying full price when they can just wait it out until the next discount comes along. The result for a business is erratic cash flow and workloads that spike then plummet drastically.
So, ask yourself, “Do I really want to build a feast or famine type of business?”
4. Loss of self-confidence
It’s not just the world at large that thinks lesser cost equals lesser value: When we get into the habit of discounting, we ourselves begin to believe that a discounted price is the actual worth of what we’re offering. One consequence is that we lose confidence and begin to hesitate in charging full price — start to question whether a product or service is really worth what we originally thought. That reduction in self-confidence makes customers question whether they can trust us.
Ask yourself, “Does what I offer bring enough value to clients to be worth its full price?” If not, rather than discounting, add more value!
5. The temptation to cut corners
I hope we all start out with the intention of bringing exceptional service to clients and customers, but when you make a habit of discounting, the natural tendency is to back off and do less for them. This might be a conscious move to keep profit margins from slipping, or it may just be an unconscious result of less enthusiasm or drive.
Ask yourself, “Am I as excited to work hard for customers when they aren’t paying full price? If I’m giving less than I can, how will that effect my business in the long run?”
Doing discounting right
Even with all these hazards, you actually can offer discounts if you do it correctly. One example is an “exclusive,” where you offer a discount to prior customers or specific groups, and which can be very effective. You can also use early bird specials or limited-time offers effectively, just as long as they don’t happen too often.
To build your customer base, you could additionally consider some kind of loss leader that’s different than your main product. If that loss leader is truly valuable to them, people will assume that your main offering will be as well.
The key is figuring out what your product or service is really worth in terms of the value it brings to clients or customers — not how much it cost you and not how much profit you want to make, but it’s true value. Once you know that, charge accordingly, and with confidence!
Image Credit: Rudy and Peter Skitterians from Pixabay
Throughout the pandemic, it has been difficult for many professionals to build and maintain new business relationships. Interactions may have been limited to Zoom calls or virtual happy hours, while valuable in-person networking events were placed on the back burner.
Now that many restrictions have eased and employees are heading back to the office or have settled in to their new work-from-home routines, many people are ready and eager for more intentional networking efforts. Below, 10 members of Young Entrepreneur Council explain how professionals can make their networking efforts more effective for the rest of 2022 and beyond.
1. Connect With Others Quarterly
Since you will likely not be at networking events or conferences as much, it is important to lay out a calendar and be intentional about committing time quarterly to connect with other experts within your sphere. In order to do this, I have been able to find some key people within my industry—subject matter experts on interesting conference topics that I was not able to attend—and reach out to them directly. This did require some legwork on the front end, such as researching them, subscribing to their newsletters, understanding their companies, etc. I was able to then reach out in a way that directly ties them to a topic they are an expert on and I am interested in. This shows that you are serious about their time. I try for one new connection a month. - Liam Leonard, DML Capital
2. Take A Big Picture View
Many people are looking to make an immediate sale or acquire a client right away, which is great when it happens. However, networking should actually be seen as a very long-term strategy. When you share information with people you meet, whether in person or online, you never know where it might lead. They may not need your services now, but they might at a later point. They may also refer you to someone else who's a better match for what you have to offer. For example, if you connect with someone on social media, they may have no interest in signing up for anything. However, if you interact with them, they may share your posts and help you expand your network and find clients. The same principle holds true for any kind of engagement. - Kalin Kassabov, ProTexting
3. Schedule It In
Staying in contact with my network via phone or video calls over the last two years has been an effective way to build and maintain new and existing relationships. Scheduling a call every six months to connect with those I feel are important in my network has been a great way to maintain those relationships. - Kristin Kimberly Marquet, Marquet Media, LLC
4. Remove The Pressure
It's important to not put too much pressure on new networking relationships. It’s easy to fall into the trap of expecting the relationship to always go somewhere, and to go somewhere fast. The key is to emphasize “building” the relationship. Building relationships takes time. Encourage, support and engage over time. Be authentic in every message—it always shines through. You’ll be surprised in the long run how many people come back around to you because you’re approachable and genuine and have also established yourself as a go-to resource in the process. - Blair Thomas, eMerchantBroker
5. Use Authentic Language
Before the pandemic, it was easy to say "How are you?" and it would be expected to hear back, "Fine, thank you!" But these days, many people are not fine, and these greetings can seem hollow and mechanical. I've been trying to use more unique and authentic greetings, such as "How are you holding up?" or "I'm reaching out hoping that you're happy and healthy." I also try to reach out with more personalized messages. For example, I might say, "I enjoyed your post about…" or "I loved your thoughts on…" This requires a little more effort than just "How are you?” but acknowledging in a simple and brief way that times are challenging and connecting to people in a more specific way can build lasting and genuine support from wonderful people. - Shu Saito, SpiroPure
6. Leverage Social Media The Right Way
While abusing social media can lead to harmful effects in the end, keeping in touch with your personal and professional accounts across digital networks is a great way to both build and maintain new relationships. For professional growth, LinkedIn and Twitter have been instrumental for connecting with prospects, partners, applicants and vendors in the past two years. Instagram additionally facilitates dozens of weekly conversations through stories, common areas of interest and hobbies. Participating in the right conversations while maintaining your own brand is a great way to start, even with as little as 20 minutes a day. - Mario Peshev, DevriX
7. Increase Your LinkedIn Activity
If you're not using LinkedIn, you're likely missing out on opportunities to network with individuals who can benefit you this year, next year or 10 years from now. As a first step, make sure your LinkedIn profile is completely filled out. Also, avoid frequent blunders such as posting an improper photo, failing to share your location, skills or degree, and failing to personalize your feed. Make a big effort to get to know LinkedIn and to become a regular, rather than a visitor, on the network. Keep in mind that increasing your network by 20% with quality connections is likely to be more advantageous than expanding it by 40% with random connections. - Candice Georgiadis, Digital Day
8. Strengthen Established Relationships
One way professionals can be more intentional about their networking efforts for the rest of the year is to focus on building relationships with people they already know. Too often, professionals spend all their time trying to meet new people instead of deepening the relationships they have. By focusing on building strong relationships with the people you know, you’ll be in a better position to reach out to them for help when you need it. What's more, when your existing network has you in mind more often, they'll be more likely to help you in some way without needing a push. So, go over your network on LinkedIn or look at your email contacts. Reach out to the people you haven't spoken to in a while and start communicating again. - Syed Balkhi, WPBeginner
9. Do Your Research
One way to be more intentional about your networking efforts for the rest of the year is to make a list of people whom you want to connect with. You can then research their backgrounds and what their interests are. This will help you come up with ideas for conversation starters. You can reach out to such people via email or by using LinkedIn. However, make sure that your approach is personalized and that you have a goal that's mutually beneficial. When you create a step-by-step plan for networking, you'll be really committed. And it'll be more likely that you'll get better results from your efforts. - Blair Williams, MemberPress
10. Remember The Value Of Small Gestures
When it comes to building relationships, small things matter. Human beings are social animals and crave connections. But building relationships takes time and dedication. In the current times, when most of us are working remotely, we don't often get to see our colleagues or teammates in person. But this doesn't mean that you'll keep the relationships strictly professional. It's okay to have some nonwork-related chats sometimes. If you're not comfortable doing that, make sure to remember when to say “thank you” or “sorry” whenever needed. Reach out to others to appreciate their achievements or celebrate milestones. Things like these help make your relationships stronger. - Josh Kohlbach, Wholesale Suite
Image Credit: Photo by Anete Lusina
Membership is open to businesses and organizations interested in increasing visibility and brand awareness in Westchester County and surrounding areas.