This is not about evaluating your customer, also not about appreciating your customer but what is your customer worth to your company?
It’s an extremely difficult question to answer. What are the costs to create a customer, what about marketing, sales activities, support, and on the income side naturally the margin added to the product or service delivered?
One of the tools to use is the Customer lifetime value:
The present value of the future cash flows attributed to the customer during his/her entire relationship with the company.
Like with many of these type of theories they are simple and straightforward, but let’s be honest , are we indeed managing this properly or are we just happy with the next “win”.
I think we can all agree that when we do know how to manage the Customer lifetime value, we are creating a sustainable organisation.
What do you do to create a profitable next new win? What do you do to target correctly? How to organise the sales process efficiently? Let’s learn!