Acquiring a new customer doesn’t just amount to a single transaction at your business. Often, customers may return for repeat services, to purchase additional products, and even tell friends and family about your business, driving new referrals that can lead to even more new customers. All of these transactions over time add up to the lifetime value of a typical customer.
To illustrate this point, take a look at this infographic that explores the lifetime customer value of an average Starbucks patron.
Takeaway for your local business: understanding your potential lifetime customer value will help you pinpoint the right marketing mix and budget to not only acquire new customers, but also to strengthen customer retention and referrals. For example, you know certain customer acquisition tactics (like search engine advertising) are critical, but adding content marketing or online reputation management to your overall strategy could amplify word of mouth and referrals, boosting the potential value of every customer.
What does lifetime customer value look like for your business? Take a moment to calculate the value of your customers – then let us know in a comment!