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Your Customer Lifetime Value Score (CLV) & Why it Matters

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Your Customer Lifetime Value Score (CLV) & Why it Matters When Shopping

Did you know that YOU have a score?

Have you ever wondered why you never receive coupons from your favorite bargain-shopping retailer? Or why you have to wait so long to speak to a customer representative on the phone? It may have something to do with your CLV score, also known as your Customer Lifetime Value. Not sure what this is? Keep reading.

Your CLV is is basically a score that represents how “valuable” you are as a customer to a business; it essentially gives businesses a look at the benefit of acquiring and keeping you as a customer.

According to The Wall Street Journal, your CLV is important because it can determine the coupons or perks you’re offered, the prices you pay for select services, and even how long you wait on hold to talk to a customer representative!

Who knew!? 😱

What You Need to Know About Your CLV Score - shopping online

If you’re the type of customer who regularly purchases goods and services from a particular business – and in turn generates more revenue for the company without coupons to drive sales – you likely have a high CLV score with that business. However, if you make too many returns, shop only occasionally, and are constantly contacting customer service with a complaint, your CLV score may be low.

Check out this comment from a Hip2Save reader:

“I’m a loyal Bath & Body Works shopper, but even after repeated requests, they won’t send me coupons. I only buy at the December sale to stock up on Vanilla Bean Noel, so that’s probably why I don’t get Bath & Body Works coupons – I must have a low ‘Consumer Lifetime Value’ score.” – Lena

Target Pickup Order shopping bags

So how does a business determine your CLV score?

Unfortunately, it’s traditionally very difficult to calculate. But without getting too technical, it can be calculated by multiplying a customer’s Average Order Value (the average amount of money that you spend every time you place an order) by their Purchase Frequency (the average amount of orders you place).

Consumer Value = Average Order Value x Purchase Frequency

Then, a business will take a look at the average customer’s lifespan, which is the length of time that a business’s relationship with a customer typically lasts before they become inactive and stop making purchases permanently. This will vary from business to business and is based on different factors.

Collin Shopping at Old Navy

As just an idea, the following factors may go into developing a customer’s CLV score for a clothing retailer:

  • Your age
  • Marital status
  • Education
  • Home ZIP code
  • Shopping patterns (when are you most likely to shop? weekdays or weekends?)
  • Shopping behaviors (do you only buy on markdown or do you pay full price?)
  • Likelihood to make returns

With that in mind, how are we (as coupon-savvy shoppers) supposed to shop and retain the highest CLV score? With coupons – or without? Should we buy items on clearance – or pay full price? Should we shop mostly on the weekdays – or head to the store on the weekends?

CLV Score - Piper carrying shopping bags

The best piece of advice I can offer is to shop with balance.

But at the end of the day, know that so long as you’re meeting your needs, those ghost coupons or slightly longer wait times just aren’t likely that big of a deal.

What do YOU think?


Join The Discussion

Comments 49

  1. JD

    I understand why a business uses this and it clearly comes with online shopping, but the perk of easy buying and shipping to your door also comes with that “big brother” cloud.

    • A

      This isn’t necessarily related to online shopping. Your data can be collected in store from credit and debit card use. Also through member accounts.

  2. Dana

    Just being completely honest here. My saving money is more valuable to me that coupons and offers from a score.

    • Dana

      *than

  3. Renee

    Is this why I get CVS coupons in my email weekly for a couple months and then never get a coupon again for rest of the year? I miss my email coupons!! But I guess I’m not exactly helping them make a profit so they’re like no more coupons for her! 😞

  4. NN

    I think I’m totally okay with a low CLV score if it means I’m not spending money and filling my life / house with things unnecessarily. Doesn’t matter much to me. Life goes on.

  5. K

    Wow who knew?! I’m sure my score is low cause I use coupons and shop mostly the deals. Oh well, I’d rather save my money than have a better score for something I never knew existed😜

    • Angela

      Same!

  6. Lo

    Ehhhh I’ll keep my low score if it means I get the items I want at the price I want. I don’t really make complaints but I do return and buy clearance and sales. And if I’m on hold I just use speaker phone and go about my day.
    Kind of seems like a gimmick for the few times you may need customer service

    • Tia in FL

      Seriously. Why would I ever buy something at full-price just to get some coupons I may never use? I don’t really feel like I wait on hold a long time the very few times I need to make a call. I could see this being a factor with airlines or maybe hotels (business travelers may get quicker service vs someone who travels once a year) but I can’t imagine this is really that important.

    • Kayla

      Same here. I make returns to Ulta and Target on a regular basis (the items always new in package, I just change my mind a lot) but I definitely buy more than I return. I’m always very polite in store and only call customer service if a coupon was missed.

      • Ana

        I called Target over the holidays and she gave me an $8.00 gift card because I’m such a valuable customer! 😀 She probably looked at my Target account, haha

  7. KS

    With many companies having the online chat option, I feel like the wait times are much better for contacting customer service!

    • Lo

      Yes! Love online chat plus you have a record of the conversation since some email it to you.

  8. A

    I have a feeling many here have a low score since I’m always seeing comments about complaints to customer service. They’ll probably complain about this too. Lol

  9. Judy Trac

    I always buy things on the cheap and return stuff if I feel like it’s too expensive. I have to be cheap behind close doors so I can pretend like I have money to my friends lol. Gotta keep that reputation

    • gary

      So you essentially waste your own time ?!?! Hmmm…sounds like a reasonable idea 🙄🙄😂😂

      • A

        Sounds like a headache!

    • coulter

      Sounds like u need new friends

      • Shannon

        Seriously, if you have to impress them are they really your friends?!

    • M

      I actually brag about getting cheap deals 😍

  10. Patricia Goff

    I never return items because I use coupons and sales to get the lowest prices. I usually give it to family and friends (it is still new by the way). It isn’t worth my time in returning it.

  11. Mamma

    Thinking of having something similar for businesses as well. BLV(Business Lifetime Value)
    There are many business who make money with fake advertisement 75%-90% off by raising the MRP. Few businesses have very poor Customer services and return policies etc.
    CLV won’t help businesses because that way they will never win unhappy or new customers. Remember, there businesses run because of customers and NOT the other way round.
    Just my 2cents

    • gary

      If only the businesses remembered that too..

  12. Jamie46178

    I would assume that this is tied to your credit/debit card, phone number / email address / loyalty cards. So, if you don’t join in those programs and refuse to share your email / phone, and pay in cash (obviously for in-store only) I would assume they can’t collect data on you?

    • Luz

      If you’re using a smartphone and/or accessing internet via other devices, data about you is being bought and sold regardless of what you do/do not sign up for, what information you volunteer, and how you pay in-store. Smartphones are data collecting devices, tied to all the personal data any company could ever want from you.

  13. Dealzgurl

    I knew that stores keep close track of returns–I have a friend who is the Return Queen, lol. But she does spend a lot of money so it probably balances out. I seldom do returns but I’m definitely a bargain shopper so I will probably always have a low score! 🙂

  14. Jane

    I just started receiving Bath & Body Works coupons again. I also just started buying from them too do definitely a connection as I hadn’t shopped there in two years. I bought quite a bit around Christmas and used the coupons. Just yesterday I received another set. I’ll gladly use them (they’ll save me quite a bit) and hopefully get even more. MY CVL score is worth it to me if it’s gonna get me a steady stream of coupons – I’ll always save quite a bit that way and then get more coupons to do it all over again 😉

    • Jane

      “so definitely”

  15. M

    I prefer to shop as I please. I remember reading complaints about people who shop somewhere all the time, maybe Target or staples, and never get coupons that some others get that hardly shop there at all. Groupon seems particular about who they send the email discounts to. On my first CVS card I was getting great coupons & discounts and shopping frequently. At some point, all of a sudden, I was getting 2 coupons a week out of the machine, no percents off. That went on for a while. I finally asked a CVS associate for a new card. Doing a bit better with it. Doesn’t make a lot of sense to me. My CLV can be on the floor but I will continue to shop as I do now.

    • Christine

      That happened to me, too. I got really good at rolling rewards across several transactions and after a year of that, I didn’t get any coupons except for the ones that everyone got. I also tried getting new cards but that didn’t really work anymore. I use my Mom’s card now and she gets tons of them. I don’t shop there or Walgreens much anymore but I still love CVS and will go there before I go to Walgreens.

  16. kerRI

    I cant believe its recommended to buy from a business at full price just so in so many words “they like me better”. I can promise if i knew of a specific company i frequented often that blacklisted me this way i could/would without hesitation blacklist them.

  17. redmanrulz010

    I wasn’t able to read the article but I think that giving perks/coupons/shorter wait times based on CLV scores could actually backfire against companies. If I have to wait an extra 10 minutes or so to talk to customer service because I have a lower CLV, I may be less inclined to continue my business with them in the future. But if you give me some perks or good customer service, I would likely be more willing to continue purchasing from a company that treats ALL of it’s customers well.

    • Amber (Hip Sidekick)

      Oh darn! Did this post not load up for you to read it? If so, be sure to let us know of any issues so that we can check it out! collin@hip2save.com

  18. gary

    A bit of a shame on you H2S. We count on you to give us deals in the same way businesses count on you to generate more business. When they see you even “suggest” buying when goods arent on sale, it hurts us in the long run. Yes i realize you are just translating a story with all the facts but as a saving site we need you to laugh at such an idea just as we do. Like another reader said, to buy things for more money in the hopes of getting coupons is an outrageous suggestion

    • Mary (Stellar Sidekick)

      Thanks for sharing Gary. We just thought it was interesting that there are scores out there like this, and wanted to share, but we agree that it’s not important enough to change the way we all deal shop!

  19. coulter

    Oh well plain and simple, no coupons or sales or deals, i dont shop there. No reason anybody at all should pay full price for anything. Too many stores, big box & online, to not find a deal.

  20. Sandy

    I wonder what’s my CLV score at Shutterfly 😂 with all those freebies (that are not free)

  21. Christine

    I stopped getting Bath & Body Works coupons after I changed my address. For awhile I thought someone in my office was swiping them. I’ve signed up again two or three times and no luck. I do wait for the best deals and rarely do the B3G3 deal. IMO, their signature line is tired and I already have a lot of the stuff that I do like from their signature line. They also keep putting out the same stuff over Christmas (peppermint, apple, etc) and I’m tired of that stuff, too. But, I do like shopping there and I love the B$10 get a free item because I can get a couple of the new items to enjoy and then go back to get something else the next time they have a good sale.

  22. A

    I don’t step foot in Bath Body Works unless I have a “free” item coupons. I’ve gotten two this past holidays, I also don’t shop at Bed, Bath, and Beyond and I’ve gotten coupons from them for 20% off and even one for $10 off $30, but didn’t use either one of them, I should of use the $10 off but too lazy to stop in b4 it expired. I’ve also occasionally get $10 off $10 from JCPenny and I only shop there if the coupons are mailed or giveaway in store. Also, signed up for VS Pink awhile back, gotten two emails $10 off coupons and only use them and not buy anything else. I’m thankful for the free coupons but I don’t care if I get them or not. I don’t shop at CVS often, but when I do for pharmacy and scan my card I always get a long sheet of coupons. Most times I don’t even use any of the coupons. Bottom line it is a marketing gimmick to get you into their store to spend more. Of course all you penny pinchers know that right?

    • KS

      Last I knew, Bed Bath and Beyond will accept expired coupons 🙂

      • Candy

        Yes they do and they also accept Buy Buy Baby coupons, current or expired. I LOVE Bed Bath Beyond❤️

  23. gailio

    Lol, my husband and I often laugh at the very different offers we get from Starbucks, Panera, & Dunkin Donuts- this must be why! Very true that all apps, stores, etc. collect lots of info on everyone (if you ever look at all the stuff you give them access to when buying an app). We also “pre shop”/compare prices using an incognito tab to make it harder for stores to keep tabs and adjust prices. Very interesting topic. Definitely we trade privacy to get good deals, coupons, etc. Also maybe clearing cookies frequently helps?

  24. ebg

    Seems like every store values different customers. Some stores send coupons to customers that frequently shop there and other stores slow down their coupons to frequent customers and instead send out the good deals to those that barely shop there to entice new customers.

    • TM

      I find what you said as correct. I used to get all the Victoria Secret coupons, they said sign up for their cc and you get more coupons, uh, it did the opposite. I don’t shop there as much and am getting more coupons. But now they are closing some of their stores, coupons may not be as frequent or at all.

  25. Sue

    Thanks for sharing this info. I felt that something like this has been going on for a few years now. Now, with algorithms combined with the information they have on us online, I find all of this a bit unnerving. I am in my fifties……Isn’t using age as a factor (I realize why they do) age discrimination? Even using marital status seems a little sketchy. Anyhow,I know this seems a little out there, but with Sears and many other stores closing, or teetering on bankruptcy, a low clv might be scary if fewer and fewer stores exist. Are we as purchasers losing out power? I hope not. But, to me as more and more stores close, in a way we are losing our power. However, I do agree with others that feel that buying things “on the cheap” is still the way to go. LOVE THIS WEBSITE!!!

  26. Sue

    ………..And we’ll always have the Dollar Store!!!!!!!!!!!!!!!!!!

  27. Sue

    ……………and we’ll always have the dollar stores!!!!!!!!!!!

  28. Sue

    But, we’ll always have the dollar stores!!!!! Where we all get treated the same : )

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