A recent independent study highlights the gap between organisations’ ability to track Customer Lifetime Value (CLV) and their application of this metric in marketing strategies, urging marketers to embrace AI technologies for enhanced consumer experiences and growth.
Independent Study Urges Marketers to Prioritise Customer Lifetime Value in AI Era
11 June 2024 – New York – A recent study commissioned by Zeta Global highlights a significant gap between the ability of organisations to track Customer Lifetime Value (CLV) and their actual application of this metric in forming marketing strategies. Conducted by Forrester Consulting, the study published on Monday sheds light on how businesses could maximize their strategic potential by effectively utilising CLV, especially in the context of evolving AI technologies.
The study, titled “Marketers Must Shift Their Understanding of Customer Value to be Forward-Looking,” surveyed decision-makers in the US and UK concerning their current practices around customer engagement. While most businesses acknowledge the importance of CLV – with 81% confident in their ability to monitor it – a mere 37% actively incorporate it into their strategic planning. This discrepancy points to a missed opportunity to leverage forward-looking, data-driven insights essential for enhancing customer experiences and driving growth.
David Steinberg, Co-founder, Chairman, and CEO of Zeta Global, outlined the critical nature of shifting towards AI-driven models that can transform marketing strategies. “This study highlights a fundamental problem with digital marketing as it has been practiced for the past 20 years: the slow movement of data leading to a KPI dashboard that is backward-looking,” Steinberg noted. He added, “Generative AI represents the cornerstone of modern marketing strategies, enabling a shift from retrospective to predictive analytics to improve consumer experiences and marketing returns.”
Key insights from the study underscore the need for a re-evaluation of how CLV data is integrated and deployed:
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Strategic Application of CLV Metrics: Even though 81% of organisations can track CLV, only 14% fully utilise these metrics to inform marketing investments and execution. This indicates a critical gap in the strategic use of valuable data.
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Increasing Importance of Profit Margin Metrics: As businesses move away from traditional vanity metrics that reflect past performances, CLV and revenue per customer are expected to gain prominence in strategic decision-making.
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Necessity for Technological Integration: 83% of respondents highlighted the importance of aligning their Martech (marketing technology) ecosystems to bolster business success. This entails integrating various technological tools to create a cohesive strategy.
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Need for Departmental Alignment: Only 19% of organisations reported full alignment across functions, with the marketing departments often being out of step with data science and analytics teams. Such misalignment can hinder the effective use of CLV data.
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Focus on Predictive Metrics: A forward-thinking approach is likely to increase marketing’s influence on business strategy, with 53% of respondents anticipating higher effectiveness through the application of predictive profit metrics.
The study’s findings point to a significant opportunity for businesses to refine their use of CLV metrics within an AI-driven framework, potentially offering greater returns on marketing investments and enhanced consumer experiences.
As organisations adapt to the rapid advancements in AI, the emphasis on predictive metrics and integrated technological solutions becomes ever more critical. By aligning internal departments and leveraging sophisticated data insights, businesses can ensure they remain competitive in an increasingly dynamic market landscape.
For a deeper dive into the insights and recommendations from the study, the full report is available for download on Zeta Global’s website.
About Zeta Global
Zeta Global is an AI-powered marketing platform designed to streamline customer acquisition, growth, and retention through advanced AI and comprehensive consumer signal processing. Founded in 2007 by David A. Steinberg and John Sculley, Zeta Global’s platform aims to simplify complex marketing by offering a unified solution for identity, intelligence, and omnichannel activation. Headquartered in New York City, Zeta Global serves enterprise customers across various industries worldwide.
