How To Master Customer Value Optimization: A Complete Guide
Chris is the Head of Operations and a Growth Marketer at Lean Labs who enjoys strategizing and writing content that drives results. When not typing away, Chris is exploring nature with his two daughters, wife, and dogs.
Getting traffic is tough.
Getting traffic to buy something is even harder.
Worse, the struggle is constant. How can you continuously draw traffic that converts without blowing your entire budget?
The answer is customer value optimization.
With this structured sales funnel, you can increase the number of customers buying from your business, their number of transactions, and their AOV.
It may sound too good to be true, but with proper planning and the right product, you can enjoy the same rewards.
Mastering Customer Value Optimization
When it comes to nurturing customers along their journey, everyone handles it differently.
The traditional way of doing business involves a salesman walking the customer through and providing all the support. Think of the car dealer asking what you're interested in, showing you options, highlighting features, and then making an offer.
In our digital age, businesses can create products, launch a robust inbound marketing program, and wait for customers to decide what they want.
With CVO, you get the best of both worlds.
Customer Value Optimization is a process that creates a sales funnel to maximize your ROI for all marketing. No matter the channel, CVO enables you to provide your customer with the right amount of nurturing, increasing your chances of securing that lead and purchase.
Take DigitalMarketer.com for example. They provide content over a wide range of marketing areas like paid traffic, content marketing, and split testing. When a customer reads an article they like, there's a free product related to the topic at the end, like DM's Blog Post Swipe File.
If the customer opts-in for that product, it tells the company that they have potential for a purchase. That specific product leads them down a particular path and into a similar, but arguably more valuable product.
If the customer purchases that plan, they'll be offered access to Digital Marketer's entire site. That's their core offer and if you buy into that, you'll be offered associated products like their software and courses.
Every step is broken into a different stage, and we'll provide you with examples that companies have used to achieve successful results.
While CVO is an exceptional strategy that 90% of successful online businesses use to some extent, it can take a lot of planning to master. It’s important to engage every stage of the process with precision, which starts with understanding each use case.
The 7 Stages of CVO
CVO is mad up of 7 stages to guide customers towards making a purchase.
Determine Product/Market Fit
The first, and arguably most important stage is determining whether the product is right for the target demographic.
This can be done by solving your customers' problems. Start with their state before buying your product. They’re frustrated or discontent with their issue. They’re looking for anything that solves their problem.
Your product is the solution. With it, they can move beyond the problem and into a more fulfilled state.
Once you’ve identified the best way to do that, you need to decide what it’s worth. The larger the problem, the more people are willing to pay.
After you’re certain the product fits your market and you’ve established your pricing, it’s time to move on to the next stage.
Choose a Traffic Source
Your main traffic sources dictate how you engage with customers.
These can be advertisements, social media platforms, organic search, blogging, or your email marketing campaigns. Regardless of how you’re trying to attract customers, plan around your budget and focus on the main goals: Driving traffic to your CVO funnel.
When you select your source, make sure you have adequate means of tracking data to learn what's working and what's not. If you can't do this, it'll be difficult to identify if your product fits the market.
Lead Magnet Offer
Per Digital Marketer:
“The Lead Magnet is an irresistible bribe that gives a specific chunk of value to a prospect in exchange for their contact information.”
A lead magnet is free. It can be a white paper, checklist, content upgrade, swipe file, or hundreds of other products.
It costs you some time to throw together, but by earning a customer’s contact information, they’ve officially entered your funnel.
To maximize effectiveness, the lead magnet needs to be as specific as possible. While you may miss out on some potential customers, the ones that download your lead magnet are those most likely to purchase your product.
Create multiple lead magnets focused on different segments of your target audience.
The tripwire is the first exchange of actual money.
The idea is that if you can get someone to spend a small amount with your business, $1 to $20, you can break through the hesitation that comes with making a first purchase and draw them to your larger ticket items.
The easiest way to do this is to sell your products at a loss. A tripwire needs to be irresistible. By making its value obvious, you tap directly into your customer’s wallet.
Like Columbia's famous example above, you're giving customers a taste of what you offer, without it being watered down. If you're providing a trial of your flagship product, the customer needs access to everything, not just a few features.
This is your crown jewel. It’s the product or service that people come to you for.
The key action at this stage is to prove that your product/service is worth the investment. By now, your customers have had at least 2 transactions with your business. The odds of them buying in are higher than ever.
Many companies will take this money and reinvest in marketing, drawing in more customers. Don’t worry, the money doesn’t stop here. Your real income stream comes from the next stage.
These are products that couple well with your core offer.
For example, if you sell guitars, your profit maximizers are the extra strings, picks, and cases. They’re items that customers want to enhance the experience that comes with your product.
If these other products don’t bode well with your core offer, another option is a membership. Memberships are ideal for companies looking to build a community with a recurring revenue model. Offer courses, workshops, or ebooks, to provide value.
Finally, the last stage of CVO is bringing customers back.
A return path can include exit offers, loyalty programs, content marketing, or ad retargeting. The goal is to drive customers towards the start of your funnel, allowing them to purchase a tripwire or another offer they didn’t initially.
After a customer has opted in, ending your emails with a CTA that restarts the process is one of the best ways to reengage your customers. After that, your funnel gets back to work, providing more value to your customers and more profits for your business.
CVO and Your Inbound Marketing Strategy
Customer Value Optimization ties in well with inbound marketing.
With inbound, leads already have an idea of what they want, and the problem that your company could help them solve. They’re looking into options and your content allows them to walk themselves through the steps.
With every article, apply a lead magnet that starts customers along the correct route of your sales funnel.
Understanding the stages of CVO, and how they optimize your sales process is great, but not always enough to establish a thorough plan.
With the following tools, you can create a sales funnel that provides extensive value to your customers while running on its own:
1. Digital Marketer’s CVO - Course
Digital Marketer’s Customer Value Optimization Certification Course is the best place to begin.
Digital Marketer sets the standard for how to build your funnel. The course provides the best overview into understanding the creation of a funnel, and how to optimize along the way.
More so, the course offers everything you need to help align your terms and ideas within your business. Through their ideology, you can streamline offer creation, ensuring the goals of each stage of the funnel are properly placed.
Even better is that they use real world examples throughout the class, showing you what works and what doesn't. They provide you with a list of the best tools around the internet to make development of your funnel easier.
The course covers some of the finer aspects of the CVO process, like retargeting and the value of adding a pixel to every page of your site.
If you only choose one resource to work with, this is the one that has it all.
2. Ryan Deiss - Influencer
When it comes to learning about CVO, who better to follow than the man who coined the term.
Ryan Deiss is the founder of Digital Marketer and well known for his work in the field of - well - digital marketing.
His bio, from Digital Marketer, highlights a few of his achievements:
- Invested over $15,000,000 in marketing tests
- Generated tens of millions of unique visitors
- Sent out over a billion permission-based emails
- Run over 3,000 split and multivariate tests
He teaches many of the certification courses from Digital Marketer himself. He is also a popular speaker and presenter, and can be found at many of the marketing world's biggest events.
Check out this video of Ryan presenting on funnel optimization:
3. "Invisible Selling Machine" - Book
A perfect add on to the CVO course, this book focuses on email marketing and incorporating CVO into your email strategy.
"Invisible Selling Machine" takes an in depth look at the process and establishes practical use with examples of what works and what doesn’t.
For a small investment of about $20, "Invisible Selling Machine" is loaded with information to move your email marketing campaigns to the next level.
4. Perpetual Traffic - Podcast
Perpetual Traffic is a podcast hosted by Keith Krance and Ralph Burns from Dominate Web Media, as well as Molly Pittman of Digital Marketer.
They provide weekly episodes on digital marketing, paid traffic, and integrating customer value optimization into your sales plan.
Their advice is actionable and gives you the surrounding knowledge to put it into play immediately.
The best part? You can listen to it anywhere, anytime.
5. Digital Marketer Engage - Facebook Group
Digital Marketer Engage is a Facebook group filled with hundreds of likeminded business owners and marketers.
Access requires a membership with Digital Marketer, but once you’re in, you’re able to poll peers for advice and read about the successes of others. Fellow marketers will share information and advertisements that didn’t work, helping others avoid the same mistakes.
The group is great resource for taking your CVO to the next level.
6. DigitalMarketer.com - Blog
What good would a resource be if it didn’t include a place for constant content?
Digital Marketer’s Blog provides you with great articles covering all of the best practices. The $15 million that Ryan Deiss has spent testing marketing techniques? This where the results are published.
Along with customer value optimization, you can read up on paid traffic, and other marketing skills. Everything is designed to build on your CVO process, increasing your ROI.
7. "DotComSecrets" - Book
Russell Brunson started running businesses while in college and within a year after graduation, he'd already sold over $1 million in products.
Owner of Click Funnels, a software company that helps establish marketing funnels, his products and coaching have resulted in thousands of businesses mastering CVO.
In "DotComSecrets," Russell spells out the secrets to his to his success and how you can achieve the same results. Even better is that he offers it for free. All you need to cover is the cost of shipping.
With customers having gained over 12 million email opt-ins and over $63 million in sales, there's no reason to pass up this opportunity for knowledge.
8. "Product Launch Formula" - Book
Jeff Walker's Product Launch Formula is a guide to get the most out of your offers.
As a stay-at-home-dad turned entrepreneur, Jeff learned the secrets to launching new products. In his book, he details the formula he's developed to replicate that process with any product online. No matter what size of business you're managing, his formula works.
Jeff's lessons couple perfectly with customer value optimization, giving you an advantage when developing your funnel.
9. Marketing In Your Car - Podcast
If his book isn't enough, Russell Brunson also runs a podcast to share all his marketing secrets.
Although he strays back and forth between topics at times, the information he provides is well worth your time.
Marketing in Your Car covers everything from email marketing to monitoring KPIs. Every topic covered gives you additional insights into strengthening your funnel. The advice is actionable and he uses real world examples to prove why you need to incorporate his findings to your CVO process.
10. "Value Proposition Design" - Book
"Value Proposition Design" is a different kind of marketing book. Written with illustrations to help clarify every lesson along the way, it's one of the easiest books to pick up with no marketing experience.
The book covers everything from creating customer avatars to establishing your marketing plan. It's a one-stop-shop for getting your business and products off the ground.
All of the tips and information built into the book set the groundwork for your strategy with the customer value optimization process. Purchase this book for a leg up on your competition.
Now that you've gotten all of the resources you need to master CVO for your business, let us know how you've applied the strategies to improve your marketing and sales process. Leave a comment below!