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Saturday, March 12, 2016

Customer Loyalty

What does loyal customer mean?
  - Someone who makes repeat/regular purchases
  - Someone who purchases across product/service lines/categories
  - Someone who refers others
  - Demonstrates immunity from going to competition.

Calculate:

  • R: Recency
  • F : Frequency
  • M: Monetary Value
And then Customer Life Time Value (LTV)

Value Pyramid of Customers/ Where is the opportunity to create loyal customers?
  • Know your best customers: Who buys high order value? Who is a repeat buyer?
  • What is the expected value in your segment?
  • What is it about your service and product right now that makes the customer buy?
  • Where does top percentage of your revenue come from? (Ticket size, geo, category, sub-cat, brand)
  • What are they buying, When are they buying, How are they buying?
  • When looking at top buyers - do look into returns and other data silos.
  • Has the value of purchase/order value grown over the time?
  • A) What are their unsolved problems? B) What are their headaches? C) What keeps them up at night?
  • Make it easy for them to try or buy your new products and services.
  • Are you doing Birthday/New Year promotions card? Do you use this opportunity to force feedback?
  • "What is one thing we could have done better?"
  • Seek out employee feedback. Make sure you empower employees.
  • Communicate the vision of promotion to the front line.
Create such a visualisation:

Total Revenue                         80% of Revenue
XXXX                                      0.8R

CUST ID         REVENUE        80% REVENUE
1                         
2
3
4
5
6
7
8                         R                        0.8R

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