In its study, The ‘Wallet-Share’ War: Measuring Customer Value and Profitability, Aberdeen surveyed 280 companies across industries to understand how they approach customer profitability. The findings, unsurprisingly, say that best-in-class companies share the use of analytical and precision marketing tools to measure and increase customer value and profitability. While no “magic bullet” emerged as a way to manage customer value effectively, the study identifies four measurements that when analyzed together show a useful customer picture: customer retention rates, customer turnover/churn, return on marketing investment (ROMI), and customer acquisition costs. More than 7 out of 10 have implemented or are planning to implement solutions to identify and segment high-value customers. This includes customer dashboards, real-time analytics, and both descriptive and predictive statistical modeling. The study mentions Australia Post as an example of a company leveraging customer value metrics. It uses both financial (revenue) and non-financial criteria (mail volume, length of contract, cross-product purchases) to profile and group its top customers. With this insight, the organization offers flexible pricing and personalized messages to its best customers. Senior managers are responsible for the customer experience and customer profitability remains a top executive priority. Read more from 1 to 1 magazine.
Filed under: CRM, Innovation, Loyalty, Measurement, Response
