CUSTOMER VALUE OPTIMISATION: THE KEY TO SUSTAINABLE GROWTH FOR YOUR ECOMMERCE STORE.

When it comes to optimising your eCommerce store, there are a lot of buzzwords and acronyms to keep track of: SEO, PPC, CTR, ROI, and so on. If you need to look any of these up, let's be study buddies 📚

One of the most important concepts to understand is CVO, or Customer Value Optimisation.

Let's explain what Customer Value Optimisation is, why it's more important than traditional conversion rate optimisation (CRO), and how you can use it to achieve sustainable growth for your eCommerce store.

WHAT IS CUSTOMER VALUE OPTIMISATION?

At its core, Customer Value Optimisation is all about maximising the value that each customer brings to your business over time. While conversion rate optimisation focuses on increasing the percentage of website visitors who convert into customers, Customer Value Optimisation takes a broader view looking at the entire customer lifecycle, from acquisition to conversion, retention, upselling and beyond.

The ultimate goal of Customer Value Optimisation is to increase the customer lifetime value (CLV) of each person who interacts with your brand. This means not only getting them to make a purchase, but also encouraging them to come back and buy more over time.

By focusing on Customer Value Optimisation, you can create a virtuous cycle where your customers become more valuable to your business, and your business becomes more valuable to your customer with every interaction. Everyone wins.

WHY IS CUSTOMER VALUE OPTIMISATION MORE IMPORTANT THAN CONVERSION RATE OPTIMISATION?

While conversion rate optimisation can be important for helping maximise short-term revenue and improving your website's performance, it doesn't lead to sustainable growth over the long term.

In fact, focusing too much on optimising for conversions can sometimes lead to a one dimensional view of your business that ignores the bigger picture and actually hurts both your top and bottom line.

Customer Value Optimisation, on the other hand, forces you to take a more holistic view of your eCommerce business. By thinking about the entire customer journey, you can identify areas where you can create more value for your customers and ultimately build a stronger, more profitable business.

HOW CAN YOU IMPLEMENT CUSTOMER VALUE OPTIMISATION IN YOUR ECOMMERCE STORE?

Implementing Customer Value Optimisation requires a shift in mindset as well as a few specific tactics. Here are some steps you can take to get started:

1. Understand your customers: The first step to optimising customer value is to understand who your customers are, what they want, and what motivates them to buy. Use tools like customer surveys, website analytics, and social media listening to gather insights about your audience.

2. Focus on customer experience: Providing an exceptional customer experience is key to building long-term loyalty and maximising Customer Lifetime Value. Make sure your website is easy to navigate, your checkout process is smooth, and your customer service is top-notch.

3. Invest in retention: Retaining existing customers is often more cost-effective than acquiring new ones. Use email marketing, loyalty programs, and other retention tactics to keep your customers engaged and coming back for more.

4. Upsell and cross-sell: Once you've acquired a customer, look for opportunities to upsell and cross-sell them on complementary products or services. This can increase the value of each transaction and boost Customer Lifetime Value over time.

5. Continuously test and iterate: Customer Value Optimisation is an ongoing process, not a one-time project. Continuously test and iterate your strategies to optimise for maximum customer value over the long term.

Customer Value Optimisation is a powerful approach to eCommerce optimisation that can help you achieve sustainable growth and build a thriving business. By focusing on maximising the value of each customer over the long term, rather than simply optimising for short-term conversions, you can create a virtuous cycle of customer loyalty and profitability.

If you haven't already, consider implementing Customer Value Optimisation in your eCommerce store today!