Consumer Value Optimization: practical tactics for brand growth
Every successful brand that you see and know of has its strategies to grow its businesses, but what is shared among all of them is that they all focus on Customer value optimization (CVO)
A study from Forrester shows that brands that lead in customer experience outperform their competitors by around 80%, and another study from Microsoft suggests that 96% of consumers disclose that customer service is a crucial factor in brand loyalty.
Undoubtedly, customer value optimization is a deciding factor for the success of a business.
At Pearl Lemon, we don’t think quick hacks and blindly following “industry best practices” are what’s needed to increase a website’s conversion rate.
We think the only way to boost your conversion rates is to take the time to understand your visitors and then give them what they need through a better experience.
In this article, we will learn what CVO is and discuss practical tactics that you can employ to upgrade the value your brand offers to customers.
What is customer value optimization (CVO)?
Take an example of serving a customer who has come to a restaurant for a meal. After taking their order, you get your CVO on. Ready for it?
“would you like a drink in the meantime?”
“Yes, please,” they answer.
By doing that, you have optimized the customer value at that moment.
CVO is more like maximizing your profits with minimal hard effort.
CVO ensures that your customers receive all the goods and services they need from you during a given transaction. They receive extra value, and you get extra profits.
CVO primarily focuses on optimizing the customer lifecycle to improve brand loyalty- and create potential clients for life.
Some of the core aspects that are vital for CVO are:
- Lead magnet offer;-It takes valuable information in exchange for contact information, usually an email address.
- Tripwire offer;-It offers low price products for quick-volume conversion.
- Core offer;-Is sells high-priced products at attractive offers.
- Profit maximizer;-involves using side products to maximize the transaction value of new customers.
- Return path;-is centered around bringing back existing and new customers into the sales funnel, especially those who left in between the purchase process.
Practical strategies you can use to implement CVO in your business strategy
Here are some of the tactics you can employ to optimize customer value.
#1. Attract the right audience
Targeting the right audience is the first step towards marketing your products or services, excluding targeting bulk traffic.
Your focus should be on the quality of customers instead of the number o customers.
Let us look into the three categories of customers every business has.
- Low-value: these are customers who bring in little to no profit for your business, and they tend to buy products at excessive discounts.
- Medium-value: these are customers that form the majority of buyers. They may not bring in significant profits, but they are high in number.
- High-value: these are customers who are worth approaching because they bring in the highest profits to your business. You can identify such types of customers and optimize their overall experience with CVO.
#2. Employ suitable advertisements.
Once you identify the right audience, you can select the different advertisement channels to promote your products and services while valuing your customers.
Here are some of the ways you can do this.
- Branded search ads.
- Google shopping ads.
- Affiliate marketing etc.
The market has a supply of similar products and services like yours. Your biggest concern should be why customers should you over the rest out there?
#3. Embrace a security-first approach
Security is critical for consumers; they ask for responsive applications, fast network performance, and a secure experience when providing personal data to eCommerce websites.
That’s why it is vital to gain customers’ trust to build relationships, trust, and loyalty. For example, eCommerce stores like Amazon offer complete website security and privacy by offering strong encryption to user data.
Encourage users to use longer passwords, with a combination of upper and lowercase plus numbers and special characters.
Taking measures like switching to HTTPS and being PCI DSS compliant can ensure that your website is safe for money transactions. Such measures improve the UX resulting in higher scales.
#4. Offer low-ticket items to incite buying.
Valuing customers also means presenting them with choices. By advertising or displaying low-priced items, you offer them options, thus inviting them to start buying.
Making such offers might not always be profitable for you, but it is worthwhile as ;
- It Earns you new customers.
- It Gives them a customer experience with you.
- Ensures brand visibility and presents a possibility of being referred to other people.
Once they develop a business relationship with you, they will become comfortable enough to buy your core products at any price.
#5. Be relatable
Give details about your products/services in a relatable way to your customers. Telling it all won’t be helpful if they will not understand it in the end.
Your ads or information you give should be explicit, straight to the point, and precise. Any message you give out should be about how your product practically benefits your customers.
#6. Call your audience to action.
Not everyone who visits your page will start buying right after registering. Many of your prospects will add their desired items to the cart but never complete the purchasing process.
You have to create a sense of emergency, and you can do this through calls-to-actions. Examples include:
- Only a few left!
- Limited offer!
- Put the number of hours left before the end of the deal etc.
In creating urgency, you are giving the prospects a limited time to think about their choices. This idea works.
#7. Feature top-selling items
It would help if you displayed the items that are in high demand first. By doing this, you are indirectly informing the prospects that:
- You are a trusted source.
- You are selling quality products, and you are suggesting the best products.
- Your site is popular.
This single action alone targets many goals at a time. You are helping them, earning their trust, and encouraging them to stay on your site.
#8. Exploit profit maximizers
Core products, in most cases, are highly-priced, which might not interest the buyers. This is where you need to employ profit maximizers.
Many companies sell their core products at lower prices, then earn their profit by selling complementary products.
For example, a pizza can be the core product for any pizza house out there, but it is not the only thing they profit from. Fries, nuggets, sodas, and toppings are other items that can increase their profit.
Customers can build long-term relationships not just for the core product but also the secondary items that come with it.
#9. Share your product reviews.
Sharing product reviews is a fantastic way of showing that you value your customers. When a customer sees the product reviews, it gives them a clear understanding of what they are getting into.
By sharing product reviews, you assist them with:
- Comparing the various products available.
- Making a final decision.
- Proving and asserting your authenticity.
Reviews come in many forms; they could be ratings, texts, or both. You can always ask your customers to review your products; this is an effective way of sounding authentic.
#10. Offer "live chat or talk to us" options to assist customers.
People will leave a site when they get confused. The reason could be anything from a lot of options to choose from or to non-satisfactory product descriptions.
You can avoid this by providing online assistance and help. A live chat or talk to us option can be of great help.
A simple message like “Hi, how can I help you?” can be a friendly gesture that pushes them to make the right decision.
Currently, many brands are using these features as service tools, and they are innovatively using them.
#11. Initiate follow-ups for abandoned purchases
Abandoned purchases are a common thing. People can show interest in buying and then suddenly go back on their plan. Many create their wishlists, others carts but never complete the transactions.
A simple reminder can bring them back to the site and encourage them to complete the transaction.
You can initiate follow-ups through:
- Email marketing
- Exit time offers
- Loyalty programs
- Retargeting ads
Different companies use different methods to follow-up, but with this method of CVO, you are telling your customers that you care and are still thinking about them.
Ready to get started?
Pearl Lemon focuses on understanding what drives, halts, and persuades your users, so your site can be tailored to offer them the best experience possible.
We move past standard conversion rate strategies and use our innovative proprietary techniques to boost conversions in real life, not theoretically.