Lately I have had more than one discussion on the lifetime value of a customer. While there a few businesses that are one shot programs like wrongful death attorney’s, most other businesses have a long term value and benefit if they can maintain a customer relationship. Every owner I talked to wanted more customers, and agreed that the customers they have are the most profitable. So when I wanted to add a customer relationship program to the mix, why do they hesitate?
It is a very interesting phenomenon and attitude among business owners. All of them will track how many customers are added to their “list” but they rarely track how many leave. Online marketing is an interesting field because the total list is always a moving target. If we forget about the existing customers for even a minute, they fall off the list faster than we can hit the refresh key.
So why is it that an owner will spend a small fortune on online advertising and not a penny to engage the existing list and make sure they don’t go anywhere else? I don’t know. The Harvard Business School has a pretty cool calculator to estimate the lifetime value of a customer.
