Lifetime Value

Creating a customer value framework, which includes calculations of Customer Lifetime Value (CLV), is an initiative that is extremely valuable to the Digital Executive.

This also is a part of obsessing over Customers. When you spend time understanding the value of your Customers and creating a framework for increased value, you are the “real” digital executive.

We all need to understand where to focus our limited sales and marketing dollars. We also need to inform our digital initiatives for a better customer experience.

Seth Godin nails it. This is huge but greatly overlooked.

If an Apple upgrade breaks your phone and you switch to Android, it costs Apple more than $10,000.

If you switch supermarkets because a clerk was snide with you, it removes $50,000 from the store’s ongoing revenue.

If a kid has a lousy first grade teacher or is bullied throughout middle school, it might decrease his productivity for the rest of us by a million dollars.

Torrents are made of drips.

The short-term impact (plus or minus) of our work or our errors is dwarfed by the long-term effects. Compounded over time, little things become big things. [I riff on some of this in the new interview I did with Larry King.]

Source: We’re still clueless about lifetime value | Seth’s Blog