Customer lifetime value and segmentation is this week’s episode of the I Hate Numbers podcast.  Last week I kicked off with part one I will be continuing from part one my exploration of customer lifetime value by looking at

  • Firstly CLV and net CLV calculation
  • Secondly, customer segmentation
  • Thirdly, customer retention.

These topics are important for anyone looking to improve their business profits, deliver a positive customer experience, or simply improve their understanding of their customers.

By segmenting customers according to their lifetime value, businesses can focus their attention on those customers who are most likely to generate long-term profits.  Customer retention is essential for maintaining profitability, as it costs much less to retain a customer than it does to acquire a new one.

By understanding these concepts, businesses can set themselves up for success in the long run.

Customer lifetime value is a number that tells you how much profit a customer will bring your business over the course of their “lifetime” with you. To calculate this, you’ll need to look at your customer’s average order value, how often they purchase from you, and how long they stay with you as a customer.

Customer segmentation is a way of dividing your customers into groups based on shared characteristics. This can be helpful in understanding which customers are most valuable to your business and how best to communicate with them.  Take a look at this video for a visual of segmentation, accreditation goes to Hubspot for the table.

Customer retention is important because it costs much less to keep a current customer than it does to acquire a new one


So in conclusion, Customer lifetime value and segmentation is an incredibly powerful number helping you focus on the right customers and increase profits. In order to set this power free though, you need to do a little bit of work up front segmenting your customers correctly and then track their CLV over time.

It’s not rocket science, but it does require some effort.  If you are willing to put in the work however, the rewards can be great.

Are you ready to start harnessing the power of customer lifetime value?  Then listen to find out more.   Check out my I Hate Numbers YouTube channel,  Subscribe to I Hate Numbers now so you don’t miss an episode.  My book, I Hate Numbers will change your relationship with numbers and money, in a good way.  Check out what people have saidbuy the book and make your own mind up, you won’t be disappointed.