Customer Loyalty Strategy Using Customer Lifetime Value (A Case Study of Jamu and Herbal Products SME).

Jamu is a traditional Indonesian medicine that has become part of the culture. The increasing demand for traditional medicines, especially Jamu in Indonesia due to the COVID-19 pandemic, provides opportunities for the traditional and herbal medicinal business. The increase in demand leads to the emergence of new traditional and health product SMEs, at the same time, online purchase transactions have also increased, encouraging SMEs to switch to e-commerce. This study aims to determine the segmentation and value of each customer segment using CLV and develop strategies for each customer segmentation in order to increase customer loyalty. The K-Means Clustering method is used to segment customers into several clusters and the CLV value is used to determine the value of each customer segment with Recency, Frequency, and Monetary (RFM) variables. Cluster deployment using the Customer Value Matrix (CVM) was also carried out to ensure cluster characteristics. Secondary data obtained from sales transactions. Analysis of product sales is carried out using the Association Rule method which produces one of the strategies in Customer Development. The research resulted in 5 clusters for customers with 13 strategies for the whole cluster. The cross-selling strategy is the recommended strategy. [ABSTRACT FROM AUTHOR]

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