On this week’s episode of B2B Nation, we spoke with Mike Poyser, VP of analytics at Aimia Americas, a global loyalty company. We discussed:
- Moving to the customer lifetime value mindset
- Searching for signifiers of longevity to measure
- How to engage with super-customers and scale that to a broader customer base
Below are a few highlights from our conversation:
Not All Customers Have the Same Value
“Rather than thinking about how the customer is valuable to you within the quarter and the year, customer lifetime value is about thinking of how the customer will be valuable over the next five years and beyond. This helps remove the immediate profit mindset and helps you think about how to engage him in the long term.
“Not all customers are of the same value, as some will stay with you for the long term. Others will only be around for the here and now and then will lapse. We’re trying to use science and data to understand who will stay around. We look at engagement metrics and other data to understand the relative value of a client. Focusing on data like this will help you target lapse-prevention for your current customers, and deciding which customers to focus on the most when you target new customer growth. Using this data can really help you understand which companies you should spend more time on.”
Signifiers of customer longevity:
- Less time with customer service and therefore less money spent on education
- Less expensive to market to for retention
- Increased self-motivated engagement
- Product choice margin: higher-quality customers tend to choose the higher profit margin products, and this makes them more valuable
Net Promoter Score and Lifetime Value
“It’s important to treat customers differently according to their behaviors as customers. There are some direct correlations between how profitable a customer is for your company and their NPS (net promoter score), which is how likely they are to recommend your company. This is directly correlated to how much they are spending and how valuable they are. This is the virtuous circle of improvement. These metrics are linked, and you should be collecting data and comparing it with other metrics to understand how to influence the customer.”
Encourage Engagement with Super-Customers
“When you find those customers who are really influential, you want to think about how they can help give you feedback and also spread messages to other customers or potential customers. These don’t have to be promotional programs; instead, you might offer them early access to a new feature so they can help you improve the product.
“This will also help you know your customers better, which means you can better personalize your product, which can then scale to other users or customers to help you sell more to those who aren’t not necessarily at that influencer level.”
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Find Mike Poyser on Twitter @mikepoyser, or connect with him on LinkedIn.
B2B Nation is a podcast for B2B sales and marketing professionals, featuring expert opinions and advice on the most important topics in the industry. Check out our other episodes on SoundCloud, or follow us on Twitter: @Technology_Adv.