The Lifetime Value of a Customer What Are They Worth to You?

The 1st step in The Seeding Process is calculating the Lifetime Value of a Customer.

Seeding and Feeding is the process for gaining new customers for your business.

Just like growing plants, it's all about planting thoughts in peoples' minds about your brand and nurturing the relationship to ensure a lifetime customer.You cannot begin to feed until you seed.

Understanding the value each customer brings to your business will help set the tone for your future marketing efforts.

The lifetime value (LTV) forecasts the net profit associated with a customer. Before you can begin seeding thoughts to your customers, you must figure out what each customer is worth to you. Keep in mind, not all customers are equal. You will have customers who last a shorter time than others. The basic formula for LTV is as follows:

Lifetime Value (LTV) = Total Customer Revenue – Total Customer Costs

Let's say you have a diaper business. The average customer would purchase diapers for 2 - 2.5 years for 1 child. In addition, a customer would purchase wipes and other products you provide for this specific need. On average, a customer will use 10-14 diapers a day plus wipes. After calculating your costs, a reasonable LTV for this customer could be $1,500-$2,000 per month.

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Using Bait Intrigue your Customers

Seeding and Feeding is the process for gaining new customers for your business.

Just like growing plants, it's all about planting thoughts in peoples' minds about your brand and nurturing the relationship to ensure a lifetime customer. You cannot begin to feed until you seed.

The 4th step in The Seeding Process is Baits.

If you're a fisherman, you are aware of the endless styles of bait available; spinner baits, plastic worms, jigs, etc. Unfortunately, there is not one miracle bait that attracts all fish. Each one is carefully designed for each type of fish, their environment, different climates, and different bodies of water.

Similar to fishing, potential customers require unique and personalized baits to get their attention;, once you have their attention, based on their stage in your sales process you can convey your message or do a sale. The bait must appeal to their lifestyle, passion and routines.

In a perfect marketing world, your potential clients would become lifetime customers after the first contact. But people usually need a push or some sort of convincing to give your brand a try. Sometimes that convincing comes in the form of word of mouth advertising from a friend. Sometimes the push comes from bait.

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Seeding Process

Feeding Process

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