Even without a strong ROAS, there’s still a way to win in the long run.
The key to doing so?
Having tidy customer lifetime value metrics.
The “Mona Lisa” eCommerce model reminded me just how important LTV is.
Not just given the fact that you do not need to spend on these customers once you’ve got them through the door…
But also that a compounding returning customer base can EXPAND your profit margins over time if you play your cards right (read this for context)
LTV is king.
You need to be doing everything you can to focus on it.
Here’s what is needed for lifetime value maxxing:
1. Superior product quality
The easiest and most obvious way.
With a superior product that solves genuine problems, once you’ve acquired your customers, it’s pretty hard to lose them.
Just focus on making sure your positioning and backend foundation (ie solid subscription app, replenishment email flows and tight fulfilment game) is on point, and the rest should take care of itself.
2. Multiple SKUs
If you ain’t in the consumables space (think supplements) and don’t have a monthly subscription option, you simply need to have MORE products on offer for people.
This is what we plan to do with Ordinary Mushrooms.
Releasing MORE products for existing customers.
Sell customers on your mission, and every additional product you release will be that much more likely to be scooped up
3. A combination of both
One of our first-ever clients we had here at Frisson Media (who have since successfully exited the space) had the ultimate LTV maxxing recipe:
- Very good product quality
- A LOT of products (including limited edition runs and seasonal drops)
- A brand that people genuinely wanted to rally behind and support
The result?
A loyal recurring customer base that would buy almost anything we would drop.
This is the best way to operate without the stress of relying on new customer acquisition.
Don’t neglect your previous buyers.
They’re the best people to sell to.
For a marketing team that can help you compound your customer base, click below:
Lachlan