Lifetime Customer Value

What is the lifetime value of a customer to your business? Simply stated it is the calculated ‘average spend’ by a client over their lifetime of dealing with you.

Some known statistics are:

Ø $6,000 to your local Pizza Shop;

Ø $10,000 to your local Tyre Retailer; and

Ø $100,000 to your Local Food Chain (Woolworths, Coles)

So you see that for the local Pizza Shop, their investment in computer equipment that makes your buying experience a good one and providing subsidized delivery is a ‘no-brainer’ if they want to get their ‘full lifetime value’ from you. What do you do to keep a Customer coming back?

It is cheaper to get an existing client to spend again than it is to acquire a new client.

If you understand the lifetime value of a client, develop opportunities to regularly promote to your existing clients. In this way you maximize the opportunities to realise the Lifetime Value of your clients.

Take the time to work out what ‘value added’ offerings you can make to get clients to come back to your business on a regular basis. 

Written by Anthony Davis

About Stress

Everyone has stress – it’s a fact of life. Good stress actually works for you to charge your body to run away from danger or to face a challenge.

Bad stress varies from vague feelings of that unsettled stomach before a deadline, to stress that stops you in your tracks and messes with your sleep, your happy relationships, your good work and your health.

Overwork and stress costs Australia more than $30 billion a year, half the total workplace injury bill. Thirty percent of the people surveyed identified issues in the workplace as being a contributor to their stress levels.

You are your own arbiter of your stress levels. Everyone handles stress in different ways.

The science of the mind and the biology of belief information that has come to light in recent years provides some simple answers for you to manage or relieve stress.

There are practical, fast processes that will lift you out of 'present moment' states of stress, discouragement, fear, overwhelm, suffering ill health or lack, towards calmer places and easy solutions. There are strategies for peace, life and health.

If you would like to know how you can move from Stress to Strength, here is an invitation to a FREE three day workshop that may just change your life. It is being presented by my personal coach and his wife, Drs Judy & John Hinwood.

Register for your place today. What have you got to lose? 

How appropriate is this piece which arrived in my inbox today:

"On the Plains of Hesitation bleach the bones of countless millions who, at

the Dawn of Victory, sat down to wait - and waiting, died."

George Cecil (1891–1970) American advertising copywriter

Written by Anthony Davis

Loss Leaders

Loss-Leaders

The concept of a ‘Loss-Leader’ is well practiced in many retail businesses. It basically is the process of offering an incentive for people to try your business which then creates the opportunity for an ‘up-sell’!

The idea of a loss-leader is worthwhile only if the Return on Investment (ROI) works out and if the seller realises and understands the ‘lifetime value’ of a client. (Our next Business Boost will look at this concept.)

Even if the initial ROI doesn't seem to be fantastic ... if the promotion generates new ‘names on a database’ and the advertiser uses the names to build further sales, then the ROI can continue to improve.

The down-side of Loss-Leaders is that those new customers may come to expect the ‘freebie/discount’ in future transactions. As long as it is ‘costed in’ to future sales then the business can continue to trade profitably.
 
Of course, if you can, take the lead from most major retailers who use their Suppliers to ‘fuel’ their ‘Loss-Leaders’  by providing heavily discounted product or even ‘free giveaways’. This way their promotional activity is always ROI positive.

Anthony Davis