What’s the most precious asset your fitness franchise can have? Members! Customer centric marketing strategies allow you to connect to the right customers in your target market, then test and optimize to grow loyalty, brand trust, and Customer Lifetime Value (CLV). As a business owner, you know how hard companies work to attract and retain customers. Another piece you should focus on in your business success formula is to increase customer lifetime value.
Customer Lifetime Value (CLV, for short) is a metric that tells you, as a business, what a customer is worth over the lifetime of their patronage with you. Obviously, the higher the CLV, the better for your business.
CLV is an important metric because it costs less to keep existing customers than it does to acquire new ones. In fact, increasing customer retention rates by just 5% can increase profits between 25%-95%. With that in mind, it’s easy to see how improving the value of your existing customers is a great way to drive growth.
You might ask, “How do I increase CLV?”
Don’t worry. You’re not alone. In this blog, we’ll go through a few of our favorite customer-centric marketing strategies designed to increase CLV and help your fitness business bottom line.
How to Calculate CLV
First things first, let’s talk about how to calculate CLV. Generally speaking, CLV is a customer’s average purchase value times their average purchase frequency rate times the average lifespan of that customer with your business.
Here are five quick steps to calculate CLV for your business:
- Understand average purchase values. This is the amount of money a customer or member spends on each transaction. Once you’ve got that number, divide one year by the number of purchases within the said period.
- Calculate the average purchase frequency rate. This is how frequently customers come back to buy from your brand. Divide the number of purchases they make by the number of unique customers who purchased from you in the same time period.
- Calculate customer value. Multiply the above numbers to calculate the customer value.
- Assess the average customer’s lifespan. Next, look at the number of years a customer has been purchasing from you and find the average for all your customers.
- Calculate lifetime value. Finally, multiply customer value by the average customer lifespan to determine your customer lifetime value.
5 Customer-Centric Marketing Strategies
Whether you’re just getting started or already established, if you’re looking for ways to make your existing customers more valuable, these customer-centric marketing strategies can help:
1. Segment Your Content
If you’re not segmenting your content already, now is the time to start. Content segmentation allows you to personalize your content as much as possible for your gym’s various demographics and to provide tailored content and suggestions that make them want to spend more money with you.
To get started, segment your members based on profitability.
Begin segmenting the list by category, like members enrolled in personal or small group training, couples, etc. Next, segment your list by CLV.
This will give you a few targeted groups for whom you can create and distribute engaging content.
2. Reinvest in Your Customer Service
It’s impossible to overestimate the value of customer service. If you want to increase CLV, you’ve got to make it a pleasure to do business with you.
With that in mind, here are a few ways to make your customer service as customer-centric as possible:
- Offer multi-channel support. Look at which channels your customers are using the most, and be sure you’re offering support on those channels. In general, we recommend offering a combination of phone, email, live chat, and social media support options.
- Respond as quickly as possible. Today, 46% of all customers expect companies to respond to support requests in 4 hours or less. Despite that, the average response time is 12 hours! Outpace your competition by responding as quickly as possible to customers. Not only will you resolve issues before they become significant problems, but you’ll also earn more loyalty and trust from your customers.
- Monitor your social channels. When customers have a complaint or a question, many of them turn to social media, and after they make a post on your page, 84% expect a response within 24 hours. Make sure you’re there for your customers by offering prompt, comprehensive responses as quickly as possible.
3. Reward Referrals
Referrals are an incredibly valuable source of new customers for businesses, so you want to make sure to reward them.
Consider offering a rewards program for members who refer other members to your facility. The rewards could take the shape of discounts on monthly memberships, credits toward services, or other perks.
4. Deliver Value-Packed Content
Currently, 60% of marketers create at least one piece of content daily. The question is: how valuable is the content?
If you want to make your customers as loyal and valuable to your brand as possible, you’ve got to give them some value in return. Fortunately, content is an excellent place to do this.
If you’re sending drip emails to your customers, make sure they emphasize the value of your product or service. If you’re writing blogs, be sure they educate and inform your customers and add value to their existing personal training or small group services.
No matter what you do, keep this mantra in mind: deliver value with every piece of content you create.
5. Build Relationships
Did you know weak relationships are responsible for about 16% of average customer churn? Combat that and keep your customer base strong and valuable by authentically investing in relationships. Use these 7 Keys To Create a Strong Personal Training Experience.
Also, build relationships in your community that support your membership interests and are mutually beneficial.
Get to know your members and tune into their expectations and feelings. Survey them regularly to find out what they like and what they want more of. Resolve issues quickly and keep looking for ways to build value.
These tips seem simple, but they’ll go a long way toward improving your CLV.
Better CLV Means More Opportunities for Your Facility
If you want to ensure the success of your business, focusing on CLV is one of the best ways to do it. Fortunately, these five tips make it easy to increase the lifetime value of your customers and build a strong, engaged, and loyal customer base for years to come.
Learn how the Alloy Personal Training Franchise has one of the fitness industry’s leading client retention rate of 97%, longest client longevity of 36 months and highest CLV.
Article by: Suzanne Robb
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