CUSTOMER LIFETIME VALUE
THE MULTI-LINE EFFECT
One of the biggest mistakes small businesses make is to hyper-focus on new customer acquisition. This overview will illustrate how shifting your focus to Customer Lifetime Value will help you protect more customers and add exponentially more profit dollars to your agency’s bottom line.
CUSTOMER ACQUISITION COST
If you want to maximize your profitability over time, understanding which activities provide the most profit dollars is key. Without knowing how much it costs to acquire a new customer, it’s impossible to prioritize investments in growth. Let’s take a simplified look at how to calculate Customer Acquisition Cost.
PAYBACK PERIOD AND PROFIT
What if your new sales are generating negative profit? How long does it take to break even? Once you break even, how much profit do you earn? Let’s analyze your Payback Period and your Contribution Margin (think, “ROI”) and then look at solutions for improving your bottom line.
To schedule an in-depth conversation with your study group or large agency about Customer Lifetime Value and Payback Period, contact us at CLV@clientfocuscorp.com.