Low Prices Equals Low Value Customers | SMH Branding

Most marketing strategies are attracting low-value prospects which results in low profit margins and less customer retention. Why? You see we attract what we set out to attract. If anything in your marketing funnel is price-oriented, then guess what? You’re naturally going to be attracting low-value prospects.

In the beauty industry low value customers are the ones that only shop at your store only when there is a huge discount or when you offer a free product promotion. They are also the same ones that email you every other day about the status of their order. And if their service is not up to their expectation than they will often leave negative reviews on your products. Low value customers require a lot of time, stress and energy to make a sale with a very low profit margin.

You might be saying that’s fine because business is so slow that low-value prospects are better than no prospects but sometimes they are not worth the headache.  If you talk price, you’ll get price based customer, if you talk benefits, you’ll get benefit based customer.

The key in attracting high value customers is to have everything you do with your marketing to be focused on helping the customer with their needs and allowing them to build confidence in you and what you provide. The customer must know how this product is going to help them in their daily need.

Price should never be a tool you use in prospecting.

To turn low quality customers into high quality ones, it is crucial to have an understanding of exactly what value are you looking for. One way to segment your customers is by their lifetime value. Compared to the many other measurable customer attributes that you can find in your customer analytics. 

You can gauge lifetime value by how long you expect the customer to stay a customer; how much money do you want that customer spend, and how often; what it costs to keep that customer loyal; and the average rate of churn throughout your customer base.

Once you’ve singled out your idea high value customers you can to offer them the best service! Your brand should do everything in its power to keep those customers around and keep them spending. All this effort is less costly than investing the time, energy, and money to convert new customers up the ladder.

But how do you turn a low quality customer into a high quality customer. Here are three strategies that you can use to impact customer value:

1. Sales: Increase per customer sales

You should try to sell more to your existing high value customers. The most common tactics to do this used here are cross-sell and upsell.


Cross-selling is selling new products or services to your existing customers. This works because the customer already know the benefits of using your brand and, more importantly, you know their purchase history. As a result, you can target your offers with more precision. In addition, you can share the benefits on why these two products should be purchased together to close the deal.

Cross-sell examples include:

  • The ubiquitous “other people that purchased this (the product) has also purchased this (a new product)”
  • Selling make-up brushes at a discount with an eyeshadow kit


Upselling is increasing the value of the specific sales interaction. This works because the customer is already in buying mode and, if packaged correctly, they will be ready to spend more with your company.

Upsell examples include:

  • "Save an additional (x)% off if you spend..."
  • "Free shipping after $ (x) spent"

How might you apply this thinking to your beauty brand?

2. Loyalty: Retain customers longer

The second way to increase customer value is by retaining customers for longer as known as customer retention.

While the multiple varies wildly depending on who you’re quoting, we know from running Facebook, Instagram and YouTube ads that it costs a lot less to retain a customer than to acquire a new one. That makes it very worthwhile to invest in retaining the right customers.

There is a range of tactics that you can use to retain customers longer:

Customer Education

Customers often leave because another brand has shown them a similar product or service which has a feature you do not have.

The the problem is you may have the feature – they just don’t know it. That is why you must present all the customers needs in short and concise way.

If you have an even moderately complex product,  it can be well worthwhile provide on-going education to customers about it by posting on your blogs, YouTube videos and email funnels.

Improve your customer experience

Customers often leave because the experience they receive from the supplier is not up to their expectations. To help keep the focus on the needs of the prospect, make sure you’re asking them questions that get them to expand upon what their problem is.

When you start your beauty brand it is important ask as much as possible for feedback on the product that you are selling. Understanding those expectations and continuously improving your customer experience to meet them is a key driver of long-term customer loyalty.

3. Stop marketing to low value customers

Lastly, you can lower the cost to serve your customers. This again comes in many forms but two important ones are:

Ensure that you are not continuing to market to customers who cannot or will not buy more of your products and services. You can remove these customers from your email funnel and save big when it comes to sending out email blasts.

In conclusion

Remember if you are forced to use discounts to attract prospects, then you haven’t figured out how to distinguish yourself from your competitor. And differentiating yourself through benefits leads to high-value customers.

When you focus your prospecting approach in this manner, the end result is you’ll find yourself dealing with even higher-value customers moving further away from price as a marketing tool.

 Do you need help building your brand? Take my free course on How to Build a Brand in 30 Days?- Click Here

1 comment

  • A good read! I totally agree. Thanks for posting this!


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