Do you know what the Lifetime Value of a current customer is worth to your business? One of the key mistakes business owners make is not understanding the value of an individual customer. Look at your customer base and ask these questions:

• What is each customer’s LTV to your business? 
• How do you measure that LTV? 
• Do you know what your average customer COULD be worth?
• Does your team know the LTV of your customers? 

Why do you spend money marketing to existing customers? When you understand your customers’ lifetime value, you have a roadmap for managing your resources and your team.  Your marketing efforts and investments can be directed at maximizing the relationship with your existing customers…spend the money where you can get the greatest return on your investment. 

When your team understands each customer’s value it changes the way they interact and behave with the customer.  Rather than processing transactions, your team is building LTV.

In many industries, the lifetime value of customers is worth multiple times the value of an average transaction. When your team understands that a $150 purchase could represent a $20,000 lifetime value their behavior changes.  Each customer your team encounters has the potential to increase their LTV to your business.  So, know your customer’s value, communicate to your team and let them build your business. What is the LTV of your customers?