Once you have set up your Customer Lifetime Value Model you can start building audiences that support your business goals. Customer Lifetime Value and Churn are for many businesses important KPIs that you need to follow closely. Here, you find inspiration to five audiences that might be useful to you when keeping track of your business KPIs.
The list is solely meant as inspiration, and we encourage you to start experimenting with audiences that are suited to your purpose and business.
1. Customers with high historic value who are in risk of churning
This might be your most important audience. It will show you customers, who have been of high value historically but are now in risk of churning. These customers have shown loyalty in the past, and it could be of high value for you to keep them from churning. High churn risk is defined by a low Predicted Alive percentage.
You need to define the amount that you consider high value and what you consider high risk of churning. In the example below, the value is set to DKK 1.000.000, and less than 25 % likelihood to ever buy again is considered high risk of churning.
2. Customers who have only bought once
This audience will contain people who have bought in your shop one time only. Along your re-targeting initiatives it is good to know how many people it amounts to. Especially because they can turn into returning customers over time.
3. Customers with high historic value and high predicted alive percentage
This audience could be considered your most valuable customers. They have already spent a lot of money in your shop, and they are not likely to stop any time soon. You might consider giving customers in this audience special treatment when communicating with them.
In this example, we consider DKK 1.000.000 a high historic value and a Predicted Alive percentage of greater than 90 % desirable to our business.
4. Shoppers who are exceeding their personal buying frequency
You want your customers to increase their buying frequency, and with the Inactivity Score from the CLV Model you can keep an eye on who are getting close to or exceeding their buying frequency average. By setting the Inactivity Score to 100, customers will enter the audience on the day they reach their personal buying average. But by setting it to 90, you will be able to reach out to people before they reach their personal average, and you can encourage them to buy sooner, which over time will increase their buying frequency.
(Note: The Inactivity Score is in this screenshot by mistake called Re-buy score)
5. Most frequent shoppers with highest value last year
Looking at customer behavior during the last year will give you an audience of people who have you top of mind right now. You might want to communicate more frequently to them or create incentive to leave a review or recommend to friends. The likelihood that these customers are happy with your services is high.
Here, we consider 30 days or less between orders as frequent and a total of more than DKK 10.000 spent the last 365 days a high value The numbers come down to your shop and the nature of your customer base.