Long Time Value of A Customer

Business owners want to have the ongoing patronage of their customers. Properly implemented marketing and advertising activities will initiate a new customer’s first transaction or patronage. But what is most important is how much potential revenue will that customer generate over the years of doing business with their company.

 

 But how do you calculate an approximate Long Time Value of A Customer? A typical calculation is:(Average Profit of a Sale) x (Projected Number of Annual Transactions by a Customer) x (Projected Number of Years a Customer will do business with you). While there are variations that can be used to calculate the Long Time Value of a Customer, this uncomplicated method is effective and reliable for measuring the profitability of a customer.

 

If a business owner feels that the amount of monies regularly invested in Marketing & Advertising activities to acquire customers is less than the Long Time Value of those customers, then they are making money. And as the Long Time Value of each customer increases, the more you can invest to acquire new ones.

The more total customers you acquire, the more revenue you make.

 

What Other Benefits does the Long Time Value of A Customer bring to a business?

A satisfied customer becomes a great & productive “word of mouth” advertiser for a business. They bring profitable new customers through referrals. And they can have Social Media reach that can help; i.e. Facebook, Twitter, Instagram, etc. When they have positive feedback to share about a business, they’ll likely post on a popular online review site.

 

“We believe that consistent targeted direct mail Post Card advertising can motivate and remind local consumers to do business with you regularly. Direct Mail Advertising with High Impact, Oversized Post Cards should produce results you can measure and profits you can count on.”

 

                    Direct Mail versus Digital/Social Media 

Using social media often results in a great deal of digital clutter. It’s why readers often scroll mindlessly through their Social Media newsfeeds, never truly processing what they’re looking at.

Direct mail has a far longer shelf life than Digital media. Consumers are more likely to notice a physical piece that they hold in their bare hands. Direct mail doesn’t compete for your attention in the same way digital content does.

For a business owner, an investment in direct mail is more straightforward than on social media, where you’re paying variable costs based on impressions, clicks or other metrics. You can control who your mail is sent to.
When it comes to cutting through clutter to deliver a productive message and making a lasting impact, targeted direct mail to local consumers outperforms its digital counterparts.