#11 Customer Lifetime Value, Customer Culture
Welcome to the 11th edition of my customer strategy newsletter. The five topics this week are:
The NPS Forum on LinkedIn
The largest Net Promoter System group on the web is the 22,800-member ‘NPS Forum’ on LinkedIn. I noticed that its owners had not posted anything in the last couple of years and seemed to have lost interest. I asked them to make me an administrator of the group. That has now been done, as of this morning. The group is here. I would welcome your advice on how to make it into an interesting place for people to learn about NPS and share their experience. I will probably make the first changes next week, based on whatever input I have by Monday.
Lifetime value of a customer
No matter what customer experience improvement system you use, knowing how much a customer is worth to you is important. With the exception of companies that only have a small number of large customers, doing P&L accounting by customer is rare. It is also quite hard to do accurately, as whatever method you use to allocate overheads by customer is somewhat arbitrary. Your finance leader is a critical ally in the work.
Lifetime value calculations are easiest for businesses that depend on renewal of annual contracts. You can use past renewal rates to predict the future. Renewal rates depend on how much the customer likes you, of course. There may also be money-losing contracts that you would rather not renew. I cover a variety of such concepts in my latest blog post: How to calculate the lifetime value of a customer. Link below.
Our latest blog posts Older posts are of course still available on the blog page.
Notable customer experience items from other sites
Posts by Adrian Swinscoe
I have been reading more and more of what Adrian writes for Forbes and on his own blog. I have written about customer culture in the past, and that is one of his focus areas. His article How Middle Managers Can Boost Employee Engagement and Customer Experience is a good read and one of his most popular. Adrian says one of his favorite articles is How The Customer Experience Vision Gap Is Holding Many Organizations Back. Once again, it is mainly about corporate culture. Apparently, Peter Drucker did not actually say “Culture eats strategy for breakfast”, but the sentiment is still a good one. If you like what Adrian Swinscoe writes, his blog is here.
The 25 Worst Customer Service Stories To Train The Best Customer Service Reps
I wish I could say I did not laugh at a lot of these, but I did. My apologies. The article from Kate Nasser is here.