Each client’s customer, marketing efforts, products, are different. It takes advanced analytics and machine learning to understand and predict preferences and behaviors. A system that makes it easy to activate those insights in ways that help brands acquire more high-value customers, accelerate loyalty within the customer base, and intervene when customers begin to veer off their expected purchase journey. When it comes to measuring your CLV, you should consider these variables for the most accurate results. In this session, we’ll touch on data hygiene, client examples, what it takes to accurately report and measure CLV.
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Holistic View of Consumer Data Across an Integrated Media Strategy to Accurately Measure CLV
1. The 2020 Customer Lifetime Value Summit
Holistic View of Consumer Data Across an Integrated Media Strategy
to Accurately Measure CLV
2. 11:00 – 11:45am PT 12:30 – 1:15pm PT
TINUITI PRESENTS:
Maximize CLV Using Email Marketing
Today’s Timeline
BLUECORE PRESENTS:
Transforming Shoppers Into Lifetime
Customers
11:45am – 12:30pm PT
TINUITI PRESENTS:
Holistic View of Consumer Data
Across an Integrated Media Strategy
to Accurately Measure CLV
The 2020 Customer Lifetime Value Summit
3. 3
● Session recording and slides will be sent out
● Log back in anytime with the same link
● Resources available as handouts
Eyebrow Text
Today’s Logistics
Persephanie Arellano
Webinar Coordinator
7. 7
Customer Lifetime Value (CLV) Overview
How to identify the most profitable customers?
How to segment profitable customers?
How much to spend to acquire customers?
Optimization &
Simulation across
scenarios
Develop, train
and test models
Collect, explore and
analyze data historical
transaction behavior and
trends, promotional
activity, seasonality, and
other external factors
such as economic
conditions and weather
patterns etc..
Define objectives
and plan
CLV
$
Customer Lifetime Value is a monetary value that represents the amount of revenue or profit a customer will
give a company over the period of the relationship
8. 8
CLV Business Impact
34% of the marketers they surveyed were “completely aware of the term CLV and its connotations.”
24% of respondents felt their company was monitoring CLV effectively.
Source: The State of Customer Lifetime Value Report, Criteo
We are happy to know you, and happy to grow you.
Increase Demand
Generation
Estimate prospective clients CLV and strategically
improve targeting to increase the conversion of high
value leads
Improve Marketing
Optimization
Measure the impact of marketing on demand across
channels and by campaign. Optimize conversion cycle by
determining the loss in value across each stage.
Actionable
Consumer Insights
Know the value of your customers and their churn risk,
create value segments, understand their profile and CLV
across channels
Reduce
Marketing Cost
Determine the amount of money that can be spent on
acquiring and retaining a customer
9. 9
Data Requirements
Transaction Activity
Channel Level Interactions
Customer Tenure
Revenue
Margin
Purchase Frequency
Churn Risk
Campaign Level Interactions
Product Purchase details
Conversion Journey
Demographics
Age
Income
Home Value
Lifestyle
Psychographics
Geographics
10. 10
Data Hygiene Process Data Requirements
Plan and identify data type
and sources need for the
analysis
Ongoing Monitoring and
Tracking
Continuous data quality testing
Data Discovery
Explore samples of these
data sources to determine
attributes need for the
analysis
Data Cleansing &
Transformation
De-Duplicate
Replace Missing
Standardize
Normalize
Establish data governance
Verify and Enrich
Compile, Analyze
and Explore
Merge datasets and explore
data to understand the data
profile and asses overall
data quality
11. 11
Know the Value of Your Customers
Prospects CLV
Future CLVHistorical CLV
Time
Value ($)
Customers CLV
1 2
3
12. 12
Tinuiti CLV Offerings
Estimate the net profit attributed to the entire future relationship of a current and prospective customers
RFM
Cohort analysis
Product Affinity
Cluster Analysis
Buyer Segmentation
● Explore and profile customers
transaction behavior
● Segment buyers into groups based on
their shopping behavior
● Identify who are your best customers
● Determine which customers have a
high risk of attrition
Historical CLV
Future CLV (Predictive)
CLV Estimation Model
● Calculate an expected lifetime value for
customers based on their margin and
survival rate or churn risk
● The expected lifetime value will allow
us to create value segments where
customers will be ranked into High -
Low groups
CLV Propensity (Predictive)
Prospect CLV Estimation (Predictive)
CLV Prospecting
● Estimates CLV of prospects based on
their similarity to current customers
based on demographics, clickstream
activity and/or conversion activity.
● Will identify prospects that are most
likely to have a high CLV based on their
demographic attributes or sales
conversion activity
13. 13
Buyer Behavior Overview
Explore buyer transaction behavior trends
Time Since Last
Purchase
Average
Transaction Value
Purchase
Frequency
14. 14
Above average
recency,
frequency &
monetary
values
Top segments - maintain and grow
● Champions - best customers
● Loyal Customers
Segments that need nurturing
● Potential Loyalist
● New Customers
● Promising
● Needs Attention
Most likely to churn
● Former Loyalist - opportunity
to re-engage
● At Risk
Potential
Loyalist
0.4%
SAMPLE OUTPUT
Spend good money.
Responsive to promotions
Lowest recency, frequency & monetary scores
Made big purchases and
often, but long time ago
Bought recently, buy
often and spend the
most
Bought more recently, but
not often
Above average
recency, frequency
& monetary values
Recent shoppers, but haven’t spent much
Buyer Segmentation
Segment, profile and rank customer value
15. 15
Historical CLV Estimation Approach
Active
$100$75
Customer Lifetime Value
Total Margin
Customer
Tenure
Acquisition
CostX -
18. 18
CLV Prospecting
Estimate the net profit attributed to the entire future relationship of a prospect
Predict the CLV value of a prospect based
on similarities to known customers using
demographics, conversion activity and/or
clickstream activity
Prospect CLV
Estimation
● Estimated value can be used to
optimize how much marketing dollars
should be spent to acquire a
prospective customer
Determine the likelihood of a prospect to
look like a customer across the High to Low
CLV segments using demographics,
conversion activity and/or clickstream
activity
CLV
Propensity
Model(s)
● Probability scores at the individual level
● Scores will be ranked into deciles to
identify target audiences
19. Key Takeaways
Plan your annual ad budget and acquire higher Value
customers using CLV to know how much it makes sense to
spend on acquisition
Use Value-Tier Segmentation and measure ad
performance using CLV to know how much of your total
revenue is provided by 5% or 10% of your customer base
and get a full picture of ads that are most effective across
your base
Secure Future VIPs by using CLV to prevent churn of
current VIPs and using predictive analytics to target new
customers who are likely to be high value in the future