Customer Lifetime Potential - Part 3
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Transcript of Customer Lifetime Potential - Part 3
©2013 Zilliant Incorporated, All Rights Reserved Worldwide Make Your Numbers™
Customer Lifetime Potential Measure and Deliver Maximum Profitability
©2013 Zilliant Incorporated, All Rights Reserved Worldwide
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With over 20 years of experience, Penny has worked closely with sales organizations to align revenue and product objectives with market needs. She has defined, developed and executed global marketing and product initiatives for manufacturing and distribution companies enabling sales teams with tools and programs to exceed market and corporate expectations.
About the Author
Penny J. MerianDirector of Product Marketing
Table of ContentsA. The Direct Costs of Taking No ActionB. The Hidden Costs of Taking No Action
1. Customer Churn2. New Customer Acquisition3. Future Revenue Loss4. Reputational Costs
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©2013 Zilliant Incorporated, All Rights Reserved Worldwide
The Direct Costs of Taking No Action
November 2011
August 2012
$92K annual revenue - recovery Average spend $11.2K/month Spend dropped to $3.6K/month
Opportunity cost: $41K revenue potential
55% decrease in 9 months
Identified $51K annual recovery Average spend $6k/month Spend dropped to $1.8K/month
©2013 Zilliant Incorporated, All Rights Reserved Worldwide
4The Hidden Costs of Taking No
Action
A marketing prediction of the net profit attributed to the entire future relationship with a customer
It’s used to judge the appropriateness of the costs of acquisition of a customer
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©2013 Zilliant Incorporated, All Rights Reserved Worldwide
Customer Attrition Cost
95%Amount of increased profits that can
come from boosting customer retention by as little as 5 percent
Source: Bain & Company
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©2013 Zilliant Incorporated, All Rights Reserved Worldwide
Customer Acquisition Costs
CUSTOMER ACQUISITION COSTS
=TOTAL SALES AND MARKETING COST
NUMBER OF NEW CUSTOMERS
6 TO 7Number of times more costly it is to
acquire a new customer than retain an existing one
Source: Bain & Company
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©2013 Zilliant Incorporated, All Rights Reserved Worldwide
Future Revenue Loss
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©2013 Zilliant Incorporated, All Rights Reserved Worldwide
Bad Reputation Costs
“It takes 20 years to
build a reputation and five
minutes to ruin it. If you
think about that you’ll do
things differently.”
~ Warren Buffett
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©2013 Zilliant Incorporated, All Rights Reserved Worldwide
Power of Science to the Art of Selling
Interested in learning how SalesMax can help you
maximize CLP?
Speak with a member of our team today at (512)
531-8503
©2013 Zilliant Incorporated, All Rights Reserved Worldwide
Zilliant provides B2B companies with data-driven guidance, enabling smarter pricing and sales decisions to help businesses make their numbers. The Zilliant optimization platform uses advanced science in its price optimization applications to enable companies to overcome the massive complexity in their businesses. Our flexible SaaS model allows customers to quickly and confidently improve their financial performance by integrating into existing systems and processes. Learn more about how Zilliant helps companies price more profitably and sell more effectively at www.zilliant.com.
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