Businesses have short-term and long-term objectives. In the short term, marketing departments are responsible for developing the necessary intelligence, systems, and processes to drive the company's viability and profitability. This article explores the four phases of B2B marketing maturity, goals, and strategies to decrease the cost of acquisition and increase effectiveness.
The first phase, market introduction, focuses on generating interest, leads, and customers through campaigns. All efforts are directed to filling the lead funnel and building an effective sales capability.
The second phase is developing a measurable, repeatable onboarding process. The third phase revolves around customer satisfaction and retention, with the fourth phase focusing on customer lifetime value (CLV). The CLV metric is the most important as it is the measure of the span of the customer's relationship in years and dollars.
To calculate CLV, one needs to take the yearly marketing and sales costs and divide by 12, then divide by the number of prospects that converted to customers within the month. Businesses can decrease the cost of acquisition by increasing the effectiveness of marketing and sales. This is done through qualitative research to understand what prospects are looking to buy, having an ideal customer profile, and building playbooks that bring the best thinking to every rep.
It is also important to understand the customer churn rate and allocate resources to customer marketing. Lastly, businesses need to calculate their CLV to get a clear picture of their growth and to determine what they need to do next.
Originally reported by Martech: https://martech.org/clv-the-metric-that-means-money/
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