Increasing The Lifetime Value of Your Customers
The Amplified Impact Podcast
June 16th, 2023
Today, I want to dive deep into a game-changing strategy that can help you skyrocket customer retention and boost the lifetime value of your clients.
As entrepreneurs, we often find ourselves fixated on marketing efforts, constantly striving to bring in new leads and convert them into paying customers.
But what about the people who have already chosen to do business with us?
I’m talking about our existing customers….the ones we sometimes overlook once the initial sale is made.
These individuals are more likely to engage with your business, given their previous positive experience. And that’s the key to increasing their lifetime value.
So, instead of solely focusing on acquiring new customers, shift your mindset to nurturing the ones you already have.
One thing as well is to always ensure that you deliver an exceptional experience that leaves your customers raving about you.
Quality matters and when you’ve nailed that, you’ll find that your customers keep coming back without much effort on your part.
Don’t just make the sale and move on; instead, keep them engaged, thinking about your brand, and eager to purchase from you again.
TWEETABLE QUOTE:
“The best way to grow your bottom line of recurring revenue. Once you get the customer to make that initial purchase, getting them to get the second or the third or the fourth is so much easier.”- Anthony Vicino
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Episode Transcript:
Anthony Vicino [00:00:00]:
What’s up, everybody? Welcome back to the podcast. Today I want to talk about a way that you can increase customer retention. You can increase the lifetime value of your customers. We’re gonna get very, very tactical with this tip. So if you’re running a business and you sell a product or you sell a service, this is gonna be a great way to get customers coming back to your store and purchasing more or reupping your service or whatever it is that your, your business, you know, revolves around on. Because often we focus so much of our time and our energy on our marketing efforts, on bringing in new leads, and then we worry about, okay, well, how do I convert that? And then how do I bring down my customer acquisition costs and all this stuff? We’re fixated on more people coming in through the funnel, but often we overlook the people who have already purchased and they’re in the funnel. So actual customers, and we look at them often and think like, well, they already bought the thing, what else is there? And really what I found to be the most impactful thing in growing businesses to seven and eight figures and beyond is to have your front of funnel purchase or product or service that gets people in. Maybe it’s a lower ticket item.
Anthony Vicino [00:01:10]:
And then you have the back of house offers services that you then upsell through. And the beauty of this is you can get a customer in, maybe they spend $100 on your initial offer, your initial product or whatever it is. And then down the road, you have these other offerings. Maybe it’s $1,000, $1,0000 or whatever it is. Because you’re marketing to a person who has already purchased the thing, you know that they’re going to be more inclined to do business with you. And if you did a great job on the fulfillment side of that product, then of course they’re going to be psyched if you have other ways that you can add value to their life. And so that’s my mindset is, for every customer that comes in, how do we increase their lifetime value? So rather than just fixating on how do I get more customers in the door at this one product, I get thinking really hard about how do I get these customers that I already have to purchase something else, how do I get them to keep buying new things? So maybe the lifetime value of this customer goes from $100 to now 150. And the effects of that are very large and a lot easier, I think, in many cases, than just going out there and trying to get more customers.
Anthony Vicino [00:02:16]:
So one of the ways that I do this is what I call birthday follow ups. And if you run a business where it makes sense to collect the birthdays of your customers, then this is easy peasy. This is all about having a reason to reach back out to them and connect on for a reason, right? Not just from a sales perspective, but like, continuing to deepen that relationship. Birthdays are a great way of doing that, but could it really be any type of holiday? It could be any type of milestone. Now, if you’re running a business where you don’t know that person’s birthday and you don’t necessarily just want to send out the Valentine’s Day offer, the Memorial Day offer, which I do think that those are all great offers that you should be sending out, but I also like sending out more personalized things. That customer goes, oh, this was only for me. This wasn’t necessarily for every customer that they’ve ever serviced. When you get the Valentine’s Day offer, you’re not feeling like, oh, I’m super special and they care about me, they thought about me.
Anthony Vicino [00:03:13]:
But if I reach out for some reason, like, six months to the day after you first purchased our product and I celebrate your purchase birthday, maybe I don’t know your actual birthday, but I celebrate your purchase birthday with us or, like, your inclusion into the club. That can be a really good reason, a good way for me to deepen the relationship and say, like, how did you enjoy this product? Are you still using? Or what did you like? What didn’t you like? Hey, by the way, I want to celebrate you for being here. So thank you for that. Here’s a discount. Here’s another product that I think you’d really be interested. And there’s so many different ways you can get creative about this. But the key is to think hard about how we can continue to mine our current customers list to increase the lifetime value of that customer, rather than just fixating on the paid advertising, the organic advertising, to get more customers in, really look hard and say, okay, I’ve serviced these hundred customers over the last year. What could I do to get them to purchase something new? How can I add more value to their life beyond that one thing? And maybe you sell a recurring product or recurring service.
Anthony Vicino [00:04:17]:
This is really simple. You can go back to them and say, hey, you’re ready for the next iteration of this? You’re out of paper towels, so here’s the next batch of paper towels, or whatever. The thing is that is, in my estimation, like, the best way to grow your bottom line of recurring revenue. Because once you get the customer to make that initial purchase, getting them to get the second or the third or the fourth is so much easier. It’s just like they’re the epitome of a hot lead. They’re a smoldering lead because they already purchased, so they’ve already overcome that biggest barrier, which was, I don’t know if I can trust you or believe that this product can serve me. Now, if your product sucks, well, you’re going to want to focus on that. If your customer fulfillment sucks, then focus on that before you’d go back to trying to get these customers.
Anthony Vicino [00:05:05]:
But I encourage you make a good product and deliver it to the best of your ability and then that is going to make people ravenous and want to come back and keep purchasing things even without you prompting them. That’s the ideal goal is that they just organically keep coming back. And if you do that, I think you’ll find a lot of success. So this was a very tactical one. If you’re running a business, I want you thinking about how can reengage my current customer list instead of just making the sell and then moving on to trying to convince the next person, how do I keep that person engaged, thinking about me and wanting my product or services. You do that, you’re going to be doing pretty well. So hope this brought you some value. People appreciate you, as always.
Anthony Vicino [00:05:40]:
Going to see you back around these parts tomorrow, but until then, stay hyper focused, my friend.
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