• How much are your customers worth?

How much are your customers worth?

If you want to build your customer base, increase sales volume, allocate your resources strategically and work more efficiently, you need to define the value of each of your customers. If you don’t already have this information, this article will help you to build an accurate picture that can change the way you work.

Customer lifetime value

If you understand the lifetime value of each of your customers, then you can be sure how to prioritise your company’s time and money. Once you understand a customer’s current lifetime value, you can begin to determine whether this value can be extended with further investment.

Many of your clients will be susceptible to churn, particularly when new technology enters the market, so you need to know who these clients are and understand how you can keep them close.

The customers you determine as having the highest lifetime value are the ones you can apply the most time and budget to. Many of these customers may be open to trying new products and services and may be able to refer their network to you. They may also be able to provide testimonials and case studies which will help you to build your online content and attract new customers.

Cost of new customers

The old marketing mantra states that it costs a lot less to acquire new customers than it does to retain current ones, but in the world of online marketing that’s not always the case. If some customers are a drain on your staff time and resources, they are likely to be in the 80 percent of customers that provide the bottom 20 percent of your revenue. The cost and length of acquiring new customers can vary, so understanding the cost of new customers requires an analysis of your marketing strategy and the return on your sales and marketing investment.

An important thing to remember when reviewing your marketing results is that social reach and engagement are only adequate measures if they’re related to click-throughs and clear customer conversion.

By understanding your marketing ROI you can be sure that you’re effectively balancing your marketing budget to achieve optimum new customer acquisition alongside increased sales volume through repeat business from existing customers.


In summary, understanding the value of your costumers will help you to shift your sales, marketing and customer service efforts to maximise your return on investment. By doing this you can achieve more efficient, cost-effective working. If you need some help to define and quantify the value of your customers, Larato can help.

Here’s what one of our recent customers said about us:

“Larato has deep insight in the technology markets and sales strategy development. The Larato team creates provocative and fascinating insights on market dynamics.”Sales Director, Network Division, Zayo

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