The Customer Lifetime Value Solution by HVG
Is your team missing a massive opportunity, by not understanding CLV?
How does this solution work?
It's a self-refreshing dynamic solution built for WooCommerce and Shopify where we connect real sales-data to Google Cloud and visualize a CLV analysis.
What is CLV?
Customer Lifetime Value is a KPI usually used by Marketing Teams that allows you to measure revenue from customers over a longer period.
But as with everything in life, there's more to it.
What can you measure with a CLV analysis solution?
A lot of things, let me list what you can measure with HVG's solution:
Total Unified Customer ID's
First Time Customers
Returning Customers
Total Revenue
Total Orders
Avg. Customer Lifetime Value
12 Months Avg. Days Between Last 2 Orders
12 Months Med. Days Between Last 2 Orders
Purchase Frequency Per Year
How many orders the average customer will make per year.
Side Note: My favorit data from this report, Dynamic RFM
A dynamic RFM report for last 365 days AND all time.
RFM stands for;
Recency
How recent someone made a purchase VS the total order data
Frequency
How many orders someone made VS the total order data
Monetary
How much revenue someone made VS the total order data
For this solution, we're looking at the last 365 days of order data.
We split the year (365 days) into 5 groups, and call this r_score (Recency Score).
Group 1 = Orders Made 0-73 Days Ago
Group 2 = Orders Made 74-147 Days Ago
Group 3 = Orders Made 148-221 Days Ago
Group 4 = Orders Made 222-295 Days Ago
Group 5 = Orders Made 296-365 Days Ago
We split all the customers and count their total orders made last 365 days into 5 groups, and call this f_score (Frequency Score)
Customer Group 1 = Top 20% Customers With Most Orders Placed Last 365 Days
Customer Group 2 = Top 21-40% Customers With Most Orders Placed Last 365 Days
Customer Group 3 = Top 41-60% Customers With Most Orders Placed Last 365 Days
Customer Group 4 = Top 61-80% Customers With Most Orders Placed Last 365 Days
Customer Group 5 = Bottom 20% Customers With Most Orders Placed Last 365 Days
Once you have all of these groups, you are able to see what (and how many) customers, have generated how much of your total Revenue, and it allows you to see customers that are maybe loosing loyalty due to many days since last order made.
If you want to have a 3x3 Matrix for Email and SMS instead, we recommend starting with this one, that is also dynamic and self-refreshing:
Engaged
Cooling
Dormant
Crossed with High, Mid or Low value customers.
Average Order Value By Order Number
AOV. on Order 1, AOV. on Order 2, etc.
Median Order Value By Order Number
Average Days to Previous Order
The amount of days on average for a customer who made Order 2 vs when Order 1 was made.
Median Days to Previous Order
A funnel that shows how many customers become Next Order Customer
For example, how many Order 1 customers, become Order 2 customers?
As seen in the screenshot, 25.42% of Order 1 customers, become Order 2 customers, and 46.35% Order 2 customers become Order 3 customers.
Amount of Revenue and Orders, per month that came from Returning VS First Time Customers
Want to activate CLV in your marketing strategy?
If you're interested in finding out how to activate CLV in your marketing teams for acquiring New Customers at a breakeven rate, feel free to reach out.
We've also created a Google Sheet that you can make a copy out of that will tell you exactly how long and how much profit you can make of your budget if you are able to generate New Customers at the breakeven based on you profits.
Just add all numbers on the green cells and you'll be able to see when you will make a profit and how long you need to wait for the profit!
Book a call
If you want us to help you out with everything, book a zero-expectations call and let's see how we can properly scale your business together with the right data!