You need valuable customers. Small business owners can win big with the right customers. Higher value customers create greater profit for your company, less work for your staff, and more to referrals to feed business growth. Focusing on lifetime customer value is a great way to grow your small business.
What is lifetime customer value? This is the value that the customer will bring to your business over time. Suppose that you have a retail store and there is a customer who comes in once a week and buys a $5 item. Do they provide a high lifetime value? Most people would say no, because these people do not see the big picture.
If you simply look at the revenue brought in by the one person, this individual's lifetime value is low. Yet, this person could be the key to more customers: referrals and more sales. You might need to help them create this possibility.
You can help this loyal customer create a high lifetime value for you.
Build a relationship with them and find out a bit about them. Why do they frequent your store and what is important to them? For example, the man who comes into your bakery every Friday might have four daughters at home. The value of catering four weddings could be pretty significant.
So, it really is a matter of perspective. A $5 a week customer might be provide you $260 gross revenue a year, or if treated properly, $20,000 over a lifetime. Focus on the lifetime customer value and provide your customers more information, support and encouragement to increase their value to you, while meeting their own needs.
A strategy of increasing the lifetime value of your customers is a great strategy to grow your small business.
Could you use more tips like this to accelerate the growth of your small business? Achievement thinking is a powerful concept that Mark Mikelat, the founder of Building Aspirations ( http://www.BuildingAspirations.com ) uses to coach his small business clients to double or even triple the size of their businesses. You can learn more and take advantage of a free strategic analysis at http://www.BuildingAspirations.com/BusinessSuccess.html Also, you can view his books on Amazon.com.