Increase your Customer LTV using AI
Learn actionable strategies to enhance lifetime value of customers. Focus on leveraging AI for customer insights to identify upsell and cross-sell opportunities.
Hey, Welcome to this week’s edition of “Future of Prospecting” Newsletter by “Evabot”.
We have been researching Generative AI Technology for the last 18 months and have been astounded by the use cases it brings in Prospecting through Hyper Targeting and Personalization. For Sales leaders and Revenue leaders, the main challenge with AI-led Prospecting is “How and What not?”
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What's your LTV?
If you're scratching your head, it’s important to keep reading…
Lifetime Value (LTV) is a critical metric for boosting revenue, margins and profitability. It’s the total revenue a customer generates during their relationship with your business.
It can be calculated using:
One-time ticket size
Monthly ticket size multiplied by the number of months the customer stays
Annual ticket size multiplied by the number of years the customer stays
Average Usage multiplied by unit price multiplied by frequency of transaction
For B2B sales leaders, increasing LTV is essential.
Why?
It’s about maximizing revenue from your existing customer base without always having to chase new ones.
Why focus on existing customers?
Higher Conversion Rates: According to Invesp, the odds of closing a sale are 60-70% with an existing customer, compared to just 5-20% with a new one. (Source)
Revenue Contribution: Research indicates that existing customers can account for up to 72% of a company’s revenue. New customers typically contribute only 28%. (Source)
LTV Equation
LTV = Average Purchase Value × Purchase Frequency × Customer Lifespan
Let’s explore how revenue teams are focusing on LTV and how AI can enhance your upsell and cross-sell approach to increase LTV.
Means of Increasing LTV
Increasing your customer Lifetime Value (LTV) can be approached in several effective ways.
Here’s how you can do it:
1. Increase the Period of Recurring Subscription
Continuously focusing on new ways of creating value can extend the lifespan of customer subscription. Here are some top ways to achieve this:
Add-ons: Offer additional features or services that complement your main product.
Freebies: Provide occasional free items or services as a thank-you for their trust in you.
Resources and Best Outcome Guides: Share valuable resources and guides to help customers get the most out of your product.
Partner Integrations: Integrate with other popular tools or services that your customers use.
Expert Assistance: Offer access to experts who can help customers achieve their goals.
2. Increase the Ticket Size
Encouraging customers to increase their subscription through additional offerings can also boost LTV.
Upsell: Promote more expensive versions or premium offerings of your product.
Cross-sell: Suggest related products or services that complement their existing purchase.
Partner Offerings: Integrate partner products or services with your solution to provide additional value.
By focusing on these strategies, you can effectively increase the revenue each customer generates over their lifetime.
How are they increasing LTV right now?
Revenue Leaders are focused on increasing customer Lifetime Value (LTV). Here’s how they’re doing it currently:
1. Asking every customer and identifying needs.
- Revenue teams are proactive in gathering feedback from all customers to identify the latest pains and ongoing engagement.
- They use this feedback to identify new opportunities for upselling and cross-selling.
2. Using customer data and insights
- Revenue teams analyze customer data to identify the right customers for upselling and cross-selling.
- They look at purchase histories, interactions, and feedback to determine who is most likely to respond positively to new offers.
3. Customized offers to Customer Needs
- Revenue teams customize their upsell and cross-sell offers based on each customer's specific needs and goals.
- By understanding what their customers prioritize and what challenges they face, companies can present solutions that truly add value.
4. Offering Bundled Deals
- Bundling multiple products or services at a discounted price is a common strategy. This makes it easier for customers to buy more while feeling they are getting better value.
5. Leveraging Sales Automation and Intent Signal Tools
- Companies use sales automation tools to streamline the upsell and cross-sell processes.
- These platforms provide insights into customer online behavior and help identify opportunities, automating the delivery of personalized offers.
What are the challenges?
Increasing customer Lifetime Value (LTV) isn't easy. Here are some common challenges businesses face:
1. Loyalty to other Vendors
- Existing Relationships: Sometimes clients are already working with other vendors and are hesitant to switch.
- Reluctance to share Needs: They might not mention their needs, making it difficult to offer relevant solutions.
2. Lack of Awareness
- Unfamiliarity with your Expertise: Clients may not know about all the services and products you offer.
3. Generic Questions
- Broad Inquiries: Asking too generic questions often fails to uncover specific needs and pains.
4. Timing Issues
- Too Early: Bringing up additional products or services too soon can annoy the customer.
- Too Late: Waiting too long might result in missed opportunities as the customer's needs evolve.
5. Lack of Relevance
- Mismatched Offers: Proposing products that don’t align with the customer's needs can damage trust and credibility.
- Customer Trust: Ensuring your offers are relevant is crucial to maintaining a strong relationship.
Navigating these challenges requires a strategic approach, focused on understanding and meeting your customers' evolving needs. It's about timing, relevance, and building trust to drive long-term value.
How can AI help?
Here’s how AI is helping in increasing LTV:
1. Account Research
- AI scans thousands of reports, earnings calls, news, social media, and other relevant sources to keep track of customer pains. This helps in identifying pain points and opportunities that can be solved through additional offerings.
2. Intent Signals
- AI tracks customer engagement with your brand assets like blogs, resources, webinars, exclusive content, and even 3rd party sites.
3. Alerts
- Get an alert as soon as AI detects any relevant insight or intent signal related to your product / service offering.
4. Confidence and Trust
- Insights from AI provide Account Managers with a heads-up on what to discuss in meetings. This builds confidence and trust with customers by addressing their specific needs and interests.
5. Scoring Accounts
- AI scores accounts based on insights, highlighting the best fit for cross-sell or upsell opportunities. This ensures your team focuses on the most promising accounts.
6. Call Notes and Email Notes
- AI generates detailed discussion and email notes based on account insights.This helps maintain clear and relevant communication with customers.
7. Signals to Marketing
- The marketing team receives signals to add high-priority customers to upcoming campaigns. This ensures focused efforts on upsell or cross-sell offerings for the next 7-15 days.
By leveraging AI, you can stay ahead of customer needs, build stronger relationships, and drive higher LTV with precise and timely actions.
How are we implementing AI in Our Workflow for Upsell / Cross-Sell Opportunities?
At our company, we’re using our own AI i.e. Evabot AI to supercharge our upsell and cross-sell efforts. Here’s how we’ve integrated it into our workflow:
Customer Tracking
List Management: We add a list of our customers for AI to monitor.
Continuous Monitoring: Evabot AI scans through 10k reports, earnings calls, news, social media, and other relevant sources to gather insights.
Prioritizing Customers
Insight Analysis: Evabot AI prioritizes customers based on the insights related to upsell and cross-sell opportunities.
Alerts: Our Account Management team gets an alert about high-potential opportunities.
Scoring Insights
Customized Recommendations: AI scores insights for each customer. This helps us hyper-personalize communication with relevant insights for additional offerings.
CRM Integration
Seamless Updates: Evabot AI integrates with our CRM to automatically feed in call and email notes with relevant account insights.
High Priority Flags: It updates our Outreach and CRM flags to mark high-priority customers for upsell or cross-sell.
Strengthening Relationships
Engagement Triggers: AI triggers account managers to engage with customers on LinkedIn through comments, messages, and thought leadership posts.
Building Trust: These interactions help strengthen trust and relationships with our customers.
By implementing Evabot AI in our workflow, we are able to precisely identify and act on upsell and cross-sell opportunities. This approach not only boosts our revenue but also enhances customer satisfaction and referrals.
Would you like to evaluate “Evabot AI” for increasing LTV, account prioritization, account research and personalization? Book a meeting on the button below.
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