Manhasset Minuteman Press

What is the value of a customer? What profit can they bring this week? This year? Over a lifetime? It may seem like a simple concept, but many small businesses have no idea what a regular customer is worth to their business. This creates two problems: Uncertainty about effective marketing. What is the number of new customers you'd like to attract and what is an appropriate budget to do that? Defining a customer value will guide your marketing strategies! Ambivalence regarding customer retention. With a metric for measuring customer values, you can navigate appropriate parameters for retaining them or expanding their business. Research shows that increasing customer retention rates by merely 5% increases profits by 25% to 95%! Customer Lifetime Value While there are many complex formulas for calculating a Customer Lifetime Value (CLV), a basic approach is to break calculations into five digestible portions, like this: Average Order Value (AOV) . On the

Cash flow is important in the lifespan of any business, but one of the key things to understand is that it's about more than just "money in versus money out." It's a valuable look into the bigger picture of what you're doing, and by having a handle on this aspect of your finances, you can take advantage of business opportunities when they arise. First, you need to understand how every element of your business relates to this cash flow concept, including marketing. To that point, marketing has a very specific relationship with cash flow that you're going to need to be aware of moving forward. Hone Your Budget Yes, it's true that marketing costs can often seem unpredictable. However, working hard to hone your marketing budget can make these unexpected situations easier to deal with. To get started, sit down and think about your upcoming marketing efforts in relation to your other expected cash inflows and outflows. You can't afford to th