Ask most retailers which metrics they’re using to determine advertising strategy, and they’ll respond with one or more of the following: revenue, profit, or ROAS. For some retailers, though, strategy is best designed around an entirely different metric—customer lifetime value.
Of course, relying on customer lifetime value metrics doesn’t mean you can ignore revenue and profit entirely! The key is to set profit targets that will enable you to also maximize customer lifetime value.
The best way to do that?
By using New Customer Contribution Margin Targets. Let’s take a look at these targets, and how to use New Customer Contribution Margin to maximize long-term profit!
New to lifetime value metrics? Our colleagues at Glew have put together a fantastic, in-depth guide to understanding why lifetime value metrics matter for campaigns, which metrics to use, and how to effectively measure them. Read it first, then come back to see how you can leverage these metrics to drive additional profit!