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How to calculate LTV with multiple monetization strategies?
Let's say you for example you are a social network that is subscription-based (1), and sells ads (2) and has a B2B2C marketplace component (3).
Are you creating Facebook?
In my opinion, you need to ask yourself what is the likelihood that your user/customer is going to drive revenue across all monetization channels. To use your example above, all users will pay a subscription fee to be a member of your social network, but maybe only 25% of them will purchase/sell products in your marketplace. I would find an LTV for each of the monetization strategies and then combine them to represent a total number per customer.
Haha no. You don't have to be a Facebook to do this. Quuu is a good example, its a marketplace content curation. Pay to promote your content, subscribe to get free content. You can be a user on both sides.
I think the % chance on purchase/sell products in marketplace is needed. Was initially curious how accurate this needs to be. I assume roundabout is the only way.
1. Subscription and marketplace are easy to calculate.
2. Sell ads: Calculate an average cpm / cpc and correlate the revenue per impressions / clicks generated per user.
Advertising revenues are hard to predict as they fluctuate according to the quality of your inventory, the verticals you focus on and the volume of traffic your network generates.
Ads revenues are also intimately linked to the quality of your social network and what incentivize the users to come back and "consume" ads.
Totally. Thanks Laurent. One other attribute to consider is not all user-groups inside this social network will be the same. Consider job-seeker in IT jobs vs. job-seeker in Manufacturing.
Is there any info on how to segment and break this user-group-LTV down based on the ad revenue?
Those are user attributes that you need to "track" so you can build segments.
Then you will have the ability to build reports by "groups" and have an idea of the value of those groups.
Imagine what facebook is doing.
They have all the groups you can think about.
I can only assume that they have analytics of what each group generates in term of EVERYTHING;)
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