Customer Lifetime Value is a prediction of all the value you will derive from a relationship with a customer or segment.
We make a good estimation of the potential value over a period of time, for example: "the potential value of this customer in the coming 12-months is $200".
Let’s take a basic example of serving an ad for clothing to two customers: Sarah, a single 24-year-old female, and John, a 32-year-old male with a family.
Sarah costs $9 to acquire while John costs $12 to acquire. Both engage with your ad and immediately purchase a $10 t-shirt. If you were focused on just low cost or immediate value, you would move to find more customers like Sarah.
However, when monitoring purchase behavior over time, Sarah never again engages with your brand, while John continues to purchase over time – in the coming weeks purchasing in total $50 of clothing for her family, and becoming a lifelong customer.
John is 33% more expensive to acquire than Sarah, yet John purchases 400% more and thus generates 28X greater ROI than Sarah. Predictive Lifetime Value ensures you continue to find and remarket to profitable, lifelong customers like John.
Datatrics uses Big Data and Predictive Analytics to combine all your data into useful insights and sales opportunities. We're on a mission to make the power of Big Data and Predictive Analytics available for all online retailers, that's why we designed an accessible SaaS platform.
We love to work with both small and large e-commerce innovators including Schiphol Group, Siemens, Giant, McGregor and many more retailers.
Know your customer, offer them more relevant content and increase sales.
Algorithms and visualizations that give you Smart and Predictive insights.
Connect all your data-sources, add external data and apply our Magic Data Trics.
You may also be interested in our other Trics: