Define customer value
Together we define how customer value is calculated for your business model and which data it requires.
Services / Customer Lifecycle / Customer value and KPIs
Customer value and KPIs: Steering the lifecycle with measurable targets
Without a shared understanding of customer value, every phase remains a local optimization. Marketing measures conversion, service measures satisfaction, sales measures revenue, and nobody sees whether the customer relationship as a whole is becoming more valuable.
ProNexum helps companies define customer value, set key figures per phase and anchor targets that several functions share.
On this page
What it is about
This is about how a company can tell whether the lifecycle works. It includes a customer value that connects acquisition, retention, development and win-back, key figures per phase and targets that fit the goals of the customer strategy.
Customer value is the yardstick for the phases. It shows which customers justify investment in retention and development, when a falling value should trigger an early warning and which win-back efforts are economical.
Customer value is a definitionHow customer value is defined depends on the business model, for example via revenue, contribution margin or expected value over the length of the relationship. What matters is that all functions use the same definition.
Interface to customer strategyWhich segments a company prioritizes and what value it expects from them is set in the customer strategy. This page is about how customer value and key figures are steered along the lifecycle phases. To customer strategy →
Typical mistakes
Key figures per function instead of per phase
Each function optimizes its own number. Nobody sees whether the relationship as a whole becomes more valuable.
Customer value without a shared definition
Different functions calculate with different values. Prioritization turns into a debate about numbers.
Too many key figures
Measuring everything steers nothing. A few key figures per phase with clear ownership are enough.
Looking back instead of steering
Reports show what happened. Steering needs targets and signals that trigger action.
Our approach
Four steps to key figures that steer the lifecycle.
Select key figures per phase
We choose a few meaningful key figures per phase and transition and check whether they can be measured reliably.
Derive targets
We derive targets from customer strategy and economics and align them across functions.
Anchor steering
We set the reporting rhythm, owners and thresholds at which measures are triggered.
Results
In the end you have clarity, responsibility and key figures for the phase.
- One shared definition of customer value
- Key figure set per phase and transition
- Targets that functions share
- Thresholds for early warning and measures
- Reporting rhythm with clear owners
A typical example
Illustrative example
Problem
A company measures conversion, satisfaction and revenue in three functions with three reports.
Solution
It agrees on one definition of customer value, selects two to three key figures per phase and sets the decline in customer value at which the early warning applies. Since then, marketing, sales and service talk about the same numbers.
How the phase connects with others
Customer value and key figures connect the four phases, from acquisition and onboarding to win-back. How the right measure reaches the customer at the right time is covered in orchestration and data.
FAQ
Frequently asked questions
Which key figures belong in the customer lifecycle?
A few per phase are typical, such as conversion and activation rate, repurchase rate, value development per customer and churn or reactivation rate. Which ones fit depends on the business model.
How is customer value calculated?
There is no single answer. Common approaches use revenue, contribution margin or expected value over the length of the relationship. We choose the approach that fits your data and decisions.
How does this differ from the goals in customer strategy?
Customer strategy defines which customers are acquired, retained and developed, and to what end. This page covers how progress is measured and steered along the lifecycle phases.
Does this apply to B2B as well?
Yes. In B2B, customer value is often viewed per account, with longer cycles and several stakeholders. Key figures and targets are then managed per account.
Do you want to steer customer value jointly?
We would be glad to discuss with you how customer value and key figures can be anchored in your lifecycle.