How to increase customer lifetime value

August 16, 2020.
Indigo paper shopping bag to illustrate customer lifetime value

Here are some of our recommendations for building a better customer experience and increasing customer lifetime value.

Customer lifetime value: Acquisition vs retention

We know it’s cheaper to retain existing customers than acquire new ones. However, despite the fact that the probability of selling to an existing customer is 60-70% compared to 5-20% with a new prospect, 44% of respondent organisations are still focusing the lion’s share of their marketing budget on acquisition.

So let’s look at how organisations can make the most out of refocusing their efforts to retention tactics and improving customer lifetime value.

Increase Your Customer Lifetime Value

Average Time Needed: 1 day


According to the Econsultancy Realities of Online Personalisation Report, 94% of businesses believe that personalisation ‘is critical to current and future success’.

Amazon is a great example of a company that’s fully embraced personalisation. No two people are likely to see the same version of the home page when they log in as the products shown are tailored to previous purchases or searches.

Smaller organisations can use simple personalisation techniques in their marketing without making a huge initial investment. Segmenting your email data list by preference is a great place to start and will enable you to tailor your communications to your different customer groups.

Don’t charge for returns

Hefty return fees for ecommerce organisations can put customers off if they’ve had to send something back. Online shoe retailer Zappos found that people who regularly returned items were some of their best customers over time as they purchased multiple options of the same, high price products.

Identifying how your organisation can absorb a cost, or go the extra mile, for your customers can pay dividends when it comes to retaining their business and increasing customer lifetime value.

Stick to your word

If you’re an e-commerce business, you’ll understand the importance of giving precise delivery times and sticking to them. Wasting a customer’s time or failing to meet the expectations you set are fast ways of reducing the likelihood you’ll win repeat business.

Good communication is essential to retention based marketing activities as we all want to be kept informed, irrespective of the type of business you’re in. If you can surpass customer expectations on a regular basis, you will not only win repeat business, but also attract new customers through word of mouth.

Reward loyalty

Offering loyal customers some kind of reward or exclusive offer is an extremely powerful way to strengthen affinity with your organisation and boost customer lifetime value. This doesn’t need to be a big grand gesture. It could be something as simple as responding to a tweet from a customer talking about your product or service, or simply sending them an offer exclusive to them.

Excellent customer service

A study by Zendesk found that consumers rank quality (88%) and customer service (72%) as the two biggest drivers of loyalty. In a bid to reduce costs, many companies make it difficult for customers to actually speak to someone on the phone.

Email or a contact form are often not the preferred option and limiting the channels through which your customers can contact you can actually be damaging.

Customers need to feel like they’re able to reach out to individuals are exemplified by the prolific use of social media as a customer service tool.

Improve email customer service

According to recent research, email is the preferred customer service channel for 44% of consumers. If you are going to utilise email as your primary channel for communicating with your customers (whether it’s an email update or a company newsletter), ensure you’re giving your communications the best possible chance of success by designing them around your customers’ needs.

For help with your marketing strategy and increasing your customer lifetime value, contact us via email at or call 01787 388038 to speak to one of our friendly team.

Dr Gemma Mackman

Dr Gemma Mackman

Research Director

Dr Gemma Mackman is co-founder and Research Director of the Mackman Group. Her professional career has given her a broad knowledge of business practices, an appreciation of good customer service and experience of a diverse range of sectors. Gemma is also a member of the Market Research Society and has completed research training provided by the Economic and Social Research Council.

More About Gemma
What Our Clients Say
We strive to create visually distinctive brands positioned intelligently and designed strategically. Our team works hard to bring our client's visions to life, and we are proud of the projects we have worked on over the years.

Our News & Blog

The latest News and Views
How can we help? 
Get in touch today and start your next project.
Telephone 01787 388038
Start A Project
crossmenu linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram