Peppers & Rogers Group combines a global perspective, deep expertise in customer strategy and decades of experience serving top companies. Read our latest insights and thought leadership on the customer economy.
Return on Customer
Executives who grew up in the world of mass media, and -- despite the freshest thinking they can muster -- still ask, when confronted with the new technologies: "How can we use social media to increase sales, increase reach and frequency at low cost, and "create buzz?" It's the wrong question to ask.
As the adage goes, you can't manage what you don't measure. So, it's important for companies to apply customer experience metrics such as customer satisfaction and Net Promoter Score (NPS) to help determine how and whether customer programs are making a business impact. But just as some companies don't go far enough in applying customer metrics to gauge their progress, some companies tend to go overboard with these measurements.
When we plan our budgets, we shouldn't think only about capital. Customers are a far more scarce and valuable resource that we need to manage just as closely.
We try to use our monetary budgets wisely. If we miscalculate and need to replace some financial investment that didn't work out as we'd hoped, and we can show we have a smart business plan with a good offer and customers who want it, then we can get more money by borrowing from a bank, or getting the budget increased. But if we use up a customer, then we can never replace her; we may be able to get another one, but we should have had two. And there are only so many customers available for the products and services you and your competitors offer. Once we use them up, we're out of business. Think about it: The only reason you have a business is because you have customers. If you don't have customers you don't have a business, you have a hobby.
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