The Value of a Lifetime Customer

Ken Evoy, Founder and CEO
SiteSell Inc.

The Lifetime Value of a new customer is the amount of profit that a new customer will bring to your business over his/her lifetime of dealing with you. Here is how to determine that value.

Even if you are only selling a single product, even if you are not selling any product or service right now... that Lifetime Value is usually in the hundreds and very often in the thousands of dollars! If you are selling higher end goods or services, the Lifetime Value of a new customer can amount to tens of thousands of dollars.

Suppose you are a pure infopreneur (i.e., no product or service for sale). Let's say that your Theme-Based Content Site provides excellent information about the Caribbean island of Anguilla. You generate income...

through Google ads
affiliate programs, and
finder's fees/referrals to local businesses.

Who are your customers in this simplest of all business models? They include everyone who...

clicks on an ad
buys a product through an affiliate program, and
who purchases from your offline referrals (earning you a finder's fee).

Beyond that, "potential Lifetime Customers" are those who sign up for your e-zine, subscribe to your RSS feed, and so forth. This is a powerful opportunity to reach thousands of people on a repeated basis, which results in even more lifetime customers.

Naturally, you get a lot of repeat traffic because your site provides such excellent content. So you can expect each new customer to provide hundreds of dollars of income over the years of dealing with you, merely through the occasional click on your Google advertising and your other monetization models.

This alone is excellent and can amount to thousands of dollars per month. But wait, it can get much better...

Now you add an e-book for sale... Perfect Days in Anguilla. It outlines a series of scheduled vacation days, from breakfast to nightcap, that deliver a "perfect day"... depending on whether that day is to be adventurous, relaxing, etc. You sell it for $19.95 and, of course, it OVERdelivers.

This is not difficult because this is a topic you KNOW. The book merely extends what you deliver on the site to "the next level," adding fresh information and packaging it all in a new and uniquely useful, salable manner.

Existing customers buy... and new ones do, too.

Next... you produce a DVD on Anguilla (easier than you think). It only costs $3 to make but you can sell it for $29.95 easily. And with the traffic you generate (since you have a SBI! site), you sell thousands.

And naturally, you update that DVD every year. Repeat sales, year after year.

Soon you offer consulting services, perhaps even move to Anguilla and offer your own tour services.

See where this is going?

The value of a Lifetime Customer is often in the thousands of dollars. And that is before you factor in the word-of-mouth "buzz" that s/he creates, spreading the word about you to friends and neighbors offline, and to others online in forums and chat rooms, etc., which brings in more and more customers, who in turn tell their friends (and so on).

Now...

Take the value of each new Lifetime Customer (call it $1,000 for purposes of this discussion). Multiply it by hundreds of new customers that your business adds, per year. Factor in the entirely new income streams that you add, over time (discussed elsewhere on the site).

Your SBI! site delivers the Content, which delivers the Traffic, people who then become PREsold, and whom you then Monetize (i.e., convert into Lifetime Customers). You're well on your way to building a real business with real equity... one that you own.

Only the logical, natural, powerful SBI! process of C T P M delivers the ability to generate high numbers of PREsold visitors who become Lifetime Customers.

And that is why SBI! owners gleefully proclaim that "SBI! is a bargain at any price."