🎓 Definition

CLV defines the value a customer will deliver to the Retailer during her lifetime, either from a cashflow perspective (sales) or profitably (margin) perspective.

There are several ways of calculating CLV, and one of the most detailed and well-explained approaches can be found in this article from Maryna Sharapa.

Measurement 

Definition 

Benefit 

Projected Sales Value or Projected Margin Value 

The amount of sales value or margin value that a customer will deliver during her lifetime as a customer. 

SEGMENTATION 

Identify the most valuable customers globally 

PLANNING & BUDGETING 

Determine the amount to be invested for Customers based on their level of importance to the Budget 

PROMOTION 

Planned promotions of Housewife Basket Items are a sure traffic driver. They should be accompanied with more premium items to balance the margin mix. 

Customer Lifetime Value (CLV) is a parameter that is customizable to user decisions.

🧪 Example of Customer Lifetime Value

For example, Store A sells maternity clothing and also toddler clothing, you might find that your pregnant customers have a low CLV because they only shop with you for a few months and the nature of the items are used temporarily. On the other hand, mothers with toddlers stay with you for 2 years (and probably shop with future kids as well) so, their CLV is higher.

❓What is CLV used for

•  To understand how your Loyal Customers interacted with your business, predict how they may interact with you in the future and how much revenue Retailers tend to make from a single loyal customer.

•  By estimating the value of a customer over their lifetime, Retailers can determine how much they are willing to spend to acquire a New Customer.

•  To tell Retailers how much loyal customers are likely to spend during their time shopping, which can help Retailers find the right combination of short-term and long-term marketing strategies.

•  To identify your top loyal customers based on their spending habits, a technique also known as ABC Analysis. This will give you more focus as you look to grow more profitable relationships with your current and future customers.


🖥️ Make it happen in Ulys CRM

How to access Customer Lifetime Value (CLV) in Ulys:1 Simple Steps

Step 1: Select Customer History Menu from the Menu Bar

And here it is. Customer Lifetime Value for each Loyal customer is displayed on the CLV column.

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Learn more about Customer Lifetime Value (CLV)
Loyal Customers
New Customer
ABC Analysis