When I discuss customer lifetime value (LTV), I regularly call it the most important marketing metric you are probably not accurately tracking. In an world where consumers demand omni-channel interactions, loaded with digital experiences, there is a lot of data for marketers to process. Here are three applications for social media marketers to use LTV:
Measure the Impact of Social Interactions.
When someone calls out your brand for good or bad, you want to respond. Link customers’ social profiles to their customer profiles, and track groups of customers that you interact with over social channels. Watch the LTV of these groups and measure the total lifetime value change before and after these interactions. BONUS: Subgroup these interactions by social media representative, and see which of your team members are generating the most and least value in their roles. You can even create bonuses for high performers.
Prioritize Ad Spend on Highest LTV Networks.
Depending on your business, your customer profile, your focus on one channel over another, different social networks will naturally bring different value customers to your store. Even within a social network, the methods you choose to use for targeting will deliver different value customers. Sum up the LTV across each social media campaign in order to determine which campaigns are driving the highest LTV customers. Then, allocate your social media ad spend away from the low-value campaigns while doubling down on the high-value campaigns.
Connect User Data to Find Signals of High and Low Value Customers.
By providing additional value to customers that link up social media accounts, you can learn a lot about them. Aggregate user data about your highest value customer quantile and your lowest. Spot patterns that may help you learn better ways to find more of the customers that contribute the most value to your organization.