Insiders guide to basic CRM strategy. How to deliver Customer Lifetime Value (CLTV)

This diagram shows you the 5 most important aspects of creating and managing customer lifetime value (CLTV). 

Wakabayashi CLTV

Here's how you use them to be successful and what to watch out for:

1) Undecided customers:
These people are often referred to as very "top of the funnel". They may find you by search or other organic means. They are the widest audience and contain mostly unqualified leads. They are expensive to convert and represent the most difficult group work with to develop lifetime value.

2) Targeted consumers:
Big data, little data, heck...any data, can help you quickly identify patterns in your existing consumers or social media followers to create a profile or "look alike" profile that creates a smart target to start driving engagement from people who want to connect with what brands have to offer. If you're looking for a big data solution then Datalogix is a great place to start and if your looking for something a little more mainstream then FullContact is good group to consider.

3) Potential customers:
Sales teams and B2Bers like to call these folks "qualified leads". Regardless of what you call them, they are the group with the highest rate of conversion and represent the best lifetime value. The best way to find and engage with these audiences is through standardized social media acquisition programs from groups like Wayin , HelloWorld or PrizeLogic.

4) Acquired customers:
If you've done your work right and been savvy about capturing these golden opportunities, then you've paid about $1 per lead. From here you'll want to cultivate an annual calendar of smart, consistent content that is delivered in a consistent cadence and provides relentless value. Fail to do this, and you're CLTV will suffer - and so will your ROI. The best ways to manage this situation is with something from Oracle like Eloqua or Responsys Working with an alternative CRM than Oracle? Fear not. Salesforce and Exact Target teamed up to offer the same solutions. Adobe is not far behind with their integration of the old Neolane system.

5) Archived customers:
This is where it gets tricky. Remember those customers that cost $1.00 to acquire? It's now costing you $1.00 per year to carry them and you're 1MM acquired customers is feeling like a heavy weight line item on your marketing budget. That's why we have to measure the "lifetime value". Not every customer is equal and you'll want to archive any CRM/Customer records that are not producing significant annual ROI.  Simply put, you want to keep the best customers and optimize their experiences so that they purchase regularly and you want to stop spending marketing dollars on customers who don't want a relationship with you. 

Easy Right? Maybe not. If you have questions. Drop me a note. I'm happy to help.

The top 5 things learned at Shop.org Retail’s Digital Summit

1)   JOURNEY MAPPPING IS EVERYWHERE

More companies than ever are moving toward “Human Centered Design” and “Consumer Journey Mapping”. This is great news because it’s exactly how consumers get the best experiences and retailers make the most money together. #winwin.

Shout’s out to Allan Kempson’s talk: “It’s all connected – the secrets of  customer journey mapping”. Allan schooled us on the importance of tuning into customers, winning political support and showing how Journey Mapping boost sales.


2)   DIGITAL RETAIL FINALLY MEANS DIGITAL IN THE STORE
Digital is getting into the retail game in major ways. (Http://www.adobe.com) Adobe is breaking new ground, changing the way consumers are served in retail dressing rooms using an interconnected view of your personal preferences, social medial behavior, inventory and fashion.  This changes everything: (http://www.adobe.com/industries/retail.html)

3)   SMART IS STILL BETTER THAN BIG WHEN IT COMES TO RETAIL
Savvy retailers like Sur La Table (http://www.surlatable.com/) are taking advantage of the latest techniques in online reputation management to reinforce top notch experiences to customers.  During Kevin Ertell’s talk we learned about several new forms of customer-generated content that are becoming crucial to the shopper journey. Yep that’s +1 for the customer journey!

4)   KNOWLEDGE IS POWER, ESPECIALLY IN THE HANDS OF STORE ASSOCIATES
How does a 100+ year old company rapidly transform into a digitally savvy retailer? Mike Amend EVP Omnichannel from JCPenney shared with us how building unique experiences through combining products and services helps consumers see the brand in a new light.  Beyond that JCPenney is arming store associates with actionable insights from digital data. That’s not all. Their smart consumer journey carries customer relationships across media from physical to digital. #smartmarketing #digitalstrategy


5)   SHOP.ORG IS STILL BRINGING US UNEXPECTED GAMECHAGERS
New technologies like Pointillist (http://www.pointillist.com/) are entirely changing the retail marketing game by helping retailers connect consumer engagement and behavior across multiple touchpoints. The good news is that we can all finally get rid of that leaking sales and marketing funnel we’ve been carrying around since St. Elmo Lewis invented it in 1898.

This years conference brought together a wide range of intelligent minds to shape the future of retail.

 

Speakers included : Michio Kaku (http://mkaku.org/) the genius behind String Theory, Jill Balis the feisty CMO from the Grommet (https://www.thegrommet.com/) , Becky Gebhart from Lands End (http://www.landsend.com/)  and a crowd favorite from UncommonGoods David Bolotsky. (http://www.uncommongoods.com/)

 

We heard many different views on the future of retail and had the opportunity to see how many leading brands are breaking new ground, paving the way and changing the game.

 

Overall the event was a strong success and Michelle Bowman @Mbowman1122 and I, @dwakabayashi really enjoyed the shop.org twitter takeover during Mike Amend’s Key note. We’re both looking forward to next year!