Lifetime Customer Value Wins the Game Over Time

How can marketers balance short- and long-term ROI goals?

Achieving short-term marketing goals without sacrificing the long term can appear to be a paradox, particularly when the marketing organization regularly confronts the hard edge of quarterly and year-end objectives for return on marketing investment (ROMI). If you don’t focus on the short term, there may be no long term. Yet, a myopic focus overlooks where the game is typically won: lifetime customer value and the ability to drive revenue.

The answer to this puzzle, as is often the case, is both nearer and further away than you expect. The data you already collect tells the story of the people who buy from you and those who don’t. But, too often, the chapters are written across disparate marketing silos, and the marketing team is unable to access or decipher the entire story.

Buyer transaction information, for example, typically sits in systems isolated from social sentiment and web and mobile behavior. To deliver on short- and long-term goals, marketing needs to connect to and analyze multiple data sources—together, in real time—to make sense of the entire customer journey.

Optimize and strategize

Consider: You launch an email campaign. To assess and optimize it, you’ll likely look at open rates, click-throughs, unsubscribes, conversions, and cart abandonment.

But these metrics by themselves don’t help uncover new revenue opportunities and improve ROMI. Buyers may simply be responding to bargains. So, look deeper: How does buyer behavior vary across channels and devices? Did your campaign create any social buzz to drive additional reach? How did the campaign impact not just your top line but also your profit margins?

If you ask questions relating to a short-term horizon, you get shortsighted answers. In contrast, data points revealing a longer-term view support strategic decisions relating to longer-term ROMI. Without the more complete view of the customer journey, strategic decisions devolve into short-term tactics with thin results.

To avoid this, analyze buyer behavior and campaign results from a bottom-up perspective to optimize the short term, yet keep an eye on the big picture to enable long-term success. Here are some guidelines:

  • Start with the right metrics.

There is no single metric that can be meaningfully interpreted when viewed in isolation. It’s the interrelationships between the metrics that give a true view into what’s happening. Therefore, consider diverse information, not just from individual campaign channels such as email, but also from CRM systems (e.g., return rates); social and mobile (e.g., virality); as well as financial systems providing revenue and profitability metrics.

  • Use marketing analytics to understand not just what consumers do, but why.

A holistic view requires looking at buyer interactions across paid, owned, and earned media. It also requires segmenting buyers to understand which segments have high-growth potential by evaluating trends across segments. It’s not uncommon to allocate the lion’s share of marketing resources to mature segments at the expense of small, but high-growth areas. You might want to attract buyers with a high virality potential to drive down cost per acquisition. Buyers who write reviews and make recommendations change the equation—sometimes improving campaign ROI.

  • Add predictive capabilities to your arsenal of solutions.

It’s essential to leverage predictive analytics to discover the critical levers of change. Predictive analytics involve analyzing large volumes of data, from multiple channels of buyer engagement, to discover trends and hidden relationships. Therein lies the key to identifying the essential drivers to desired outcomes. Predictive analytics not only provide you with a crystal ball, but the insights quite literally help you change that future to one that is more favorable.

Consumers leave behind a trail of breadcrumbs, telling you what motivates them to buy your products, when, and in which channels. But the mass of data is of little value unless you unlock that insight and deliver back what is personally compelling to your buyer. Short- and long-term success comes down to relevance; conveying the right message at the right time to the right buyers. So it’s up to you, the marketer, to use these data breadcrumbs to synchronize your selling cycle with customers’ buying cycle, delivering the relevance they demand and deserve.


Pelin Thorogood, Anametrix

Pelin Thorogood, CEO and a board director of Anametrix, has been immersed in new media marketing and analytics for nearly 20 years. In the mid-1990s she helped launch one of the first mobile B2B applications while at Peregrine Systems (since acquired by HP). Her creative and scientific approach to solving marketing challenges originated from her time at Cornell University, from which she holds a bachelor’s and two master’s degrees. Her ties to Cornell continue to this day; she serves as Executive-in-Residence for the Johnson Graduate School of Management. When she isn’t working, Thorogood spends time outdoors with her two young children, plays tennis, or rejuvenates through yoga. If anything, this vibrancy reflects one of Thorogood’s favorite fictional characters, Anne of Green Gables. “I love her passion, joie de vivre, and frankness,” she says.

Check out the other answers:

Related Posts


E-commerce Finalists Dolce Gusto Agency: OgilvyOne Frankfurt Client: Nescafe ECD: Michael Kutschinski Hybird Shop, A Global E-Commerce Site…
Read More