Lifetime Value

Big business look at the lifetime value of a customer. If for example an average customer were to spend $100,000 with you per year for the next 10 years, then would you be prepared to spend $100, $1000 or even $10,000 to get new customers like this? What makes them a good customer for you? Have you asked them? What do you do that makes them come back to you? In the business computer field customers normally replace their computers every 3 – 5 years because of new software or hardware or wanting the reliability of having new systems. Why is then that some businesses don’t take this into account when you enter their business or phone them? I was looking for a new ride on mower today and I went into a business that sells ride on mowers and walked around their store. The sales person was serving another customer and so I keep looking at what was on display in the shop and in front of the shop. When the sales person was finished serving the other person he disappeared behind a wall and started chatting (not about work stuff) to another person. I waited for a period of time for the sales person to reappear but that didn’t happen. So, I left the shop and drove away. I am sure that there is another mower shop that is prepared to provide some service and take my money. In this case they did something - pissed off a customer (me) and I left. Just how much did their chatting and lack of service cost them? How hard is it to say “I’ll be with you as soon as I am finished here”? They could have had me as a new customer and a few thousands of my dollars and don’t forget the ongoing servicing of the mower as well as any other equipment that I need to look after my little 5 acres.