• Best CPA Networks
  • Best Cost-Per-Sale Affiliate Networks
  • Best Pay-Per-Call Networks
  • mThink Digital
  • Thought Leadership
    • White Papers
  • About
    • Content Marketing
    • Content Strategy
      • Web Content
      • Social Media Strategy
      • Webinars & Video
      • Thought Leadership
    • Performance Marketing
    • Portfolio
      • Revenue Performance
      • Accenture
      • Microsoft
      • Java Detour
      • Our Process
    • Contact Us

mThink

Blue Book Logo

BlueBook Logo

The Trusted Name in Performance Marketing

ROS Leaderboard

  • Home
  • Blue Book
    • About Blue Book
    • Blue Ribbon Panel
    • Interviews
    • Research Methodology
    • Back Issues
    • Advertising
      • Website Creative Specifications
      • Newsletter Creative Specifications
  • Best CPA Networks
  • Best Cost-Per-Sale Affiliate Networks
  • Best Pay-Per-Call Networks
  • Best European CPA Networks
  • Best CPA Networks for Affiliates
  • Best CPA Networks for Advertisers

Customer Lifetime Value Is The Most Important Metric You Are Ignoring

October 11, 2018 by Kate Hagan, Clickbooth

customer lifetime valueYour Affiliate Marketing Longevity

In the affiliate marketing industry, cost-per-acquisition has always been king. It’s the metric that tells us how much it costs to drive a sale, and how much can be spent in order to close that sale.

But what if there was a different metric? One that gave a deeper understanding of the customer journey and of which customers are the most profitable? Did the customer purchase the upsell offered after the initial purchase? Did they subscribe to receiving your product for months at a time? Did they make a related purchase for a new product?

All these questions can now be answered with the help of new technology and advanced analytics tools that are accelerating the evolution of the affiliate marketing industry. The analysis and valuation of consumer behavior beyond the initial click can be aggregated into a single metric known as Customer Lifetime Value (CLV), and it may be the most important metric that you are ignoring.

Customer Lifetime Value

A simplified way to think about a customer’s lifetime value is the dollar amount gained from their “lifetime” of engagement with you. Depending on your product, this lifetime could be short or long term – analyzing your data will give you a good idea of what an ideal customer lifetime value is. How many customers made a repeat purchase? How long did a customer continue to stay receptive to your product offerings? Answers to questions like these will help you quantitate the average “lifetime” for your ideal customer.

A tracking platform can help you pull the necessary data on each of your customers by assigning all of a buyer’s purchases to an anonymous individual ID. Examining an average of your customer behaviors will provide insight into which ones contribute most to profitability and thus make a huge difference in your marketing efforts.

Using CLV to Optimize Across Platforms

If you’re utilizing multiple affiliate platforms to drive traffic to your campaigns, CLV analysis is a great way to compare the performance of each platform. It’s one thing to know the amount of traffic received from an affiliate platform, but it’s arguably even more important to know the quality of the traffic and how profitable it is over time. Analyzing this CLV data will help you determine if your expectations are on target, too low, or too high, and whatever the outcome, it is much better to be able to make informed decisions rather than just flying blind.

CLV allows affiliate managers to see the true value of their entire channel and which affiliate partners drive the most loyal and profitable traffic. This information can then be used in the  creation of promotions to reward the most profitable lifetime customers and encourage them to keep returning.

Applying Machine Learning to CLV

Thanks to machine learning advancements in affiliate marketing, customer lifetime value analysis can now be used to discover related products that your customers are likely to purchase. Using accumulated data on previous purchase combinations and on typical customer behaviors, you can now identify related items that a given individual customer may be more likely to buy.

This is called association analysis, and it’s a genius way for brands to proactively position themselves up for increased sales. Having insight into exactly which types of products to market together, or in sequence, is likely to lead to the greatest chance of a customer making multiple purchases.

Moving Forward

Over time, your customer lifetime value data becomes extremely powerful. When CLV is high, it will tell you where to continue pushing your efforts. If it’s low, it may well be a sign that it is time to reevaluate the products and partners you work with.

As with all metrics, it’s important to remember that, while collecting CLV data is important, it is not the end all be all analysis solution, however with the volume of granular data that affiliates and affiliate partners now have access to, there is every reason to focus on the big picture of exactly which customer behaviors drive most profit.

About Clickbooth

Clickbooth is a technology company that takes a programmatic approach to traditional performance marketing resulting in zero risk and higher returns for clients. The company’s proprietary performance exchange provides advertisers looking for new customer acquisitions access to the largest distribution network of online marketing experts, specializing in display, social, native, search, email and contextual traffic. Affiliates using the platform see 30% higher EPCs and let the platform handle optimization, cap management and offer testing for them, allowing them to aggressively scale their businesses. Visit us at www.clickbooth.com.

 

 

 

Related posts:

  1. Secrets To Growing A Boutique Network – Pt II Two weeks ago we spoke with Chris Patrick of MonsterAds...
  2. 3 Vital Insights to Know about the Cross-Device Shopper’s Purchase Path Consumers today are device and channel agnostic, and seamlessly switch...
  3. 2017 Investments, Technology and Fraud Interview with Adam Weiss, General Manager and SVP for Rakuten...
  4. The 4 Biggest Internet Trends Affecting Affiliate Marketing Trends Affecting Affiliate Marketing Kleiner Perkins partner Mary Meeker is...

Filed Under: Blue Book, Featured, Revenue Tagged With: affiliate marketing, affiliate networks, customer lifetime value

Search

ROS Col 2 Top

ROS Col 2 Mid

ROS Col 2 Low

Subscribe to our newsletter!

* indicates required

ROS Col 2 – 4 Misc

ROS Col 2 – 5 Misc

ROS Col 2 – 6 Misc

Recent Posts

  • How Financial Marketers Can Boost New Customer Growth on an Affiliate Model
  • Crypto Griftonomics And Influencers In Affiliate Marketing
  • Don’t forget about click-to-call: the most underrated vertical for social media traffic
  • Why The Speed of Relevance Can Help You Win
  • Why Should Marketers Invest In Pay Per Call?
  • CFPB Issues Warning About Contractual Gag Clauses and Consumer Reviews
  • New Blue Book Top 20 CPS Affiliate Network Results
  • FTC Rules With Civil Monetary Penalties for Deceptive Earnings Claims and Targeted Marketing May Be Forthcoming
  • New Blue Book Results: Top 20 CPA Affiliate Networks For 2022
  • FTC Rules With Civil Monetary Penalties for Deceptive Earnings Claims and Targeted Marketing May Be Forthcoming
  • Top 4 Ways To Make Your Call Campaigns More Successful
  • Perform[cb]’s New Mobile App For Partners Is A Game Changer
  • Shaping the Perfect Matchmaker for Content Creators
  • Removing Barriers for Influencers and Content Creators
  • 8 Easy Ways To Refresh An Email Campaign

About mThink

mThink is a specialist digital marketing company based in San Francisco. We focus on media buying, Facebook marketing, direct response, social and mobile. In addition mThink produces the annual Blue Book Rankings of major performance marketing networks. Read More »

Baseboard

Copyright ©2022 · mThink. All rights reserved.
3053 Fillmore Street, Suite 325 | (415) 787-0250
Disclaimer | Privacy Policy