The ABC's of business numbers.
Published 20060828 by Olivier Blanchard | E-mail this post
Wow. I just tested three business owners and managers this afternoon, and all came up with shrugs and deer-in-the-headlights looks when I asked them these simple questions:
1. Do you know the average annual value of a customer to your business?
2. Do you know the cost of a customer complaint to your business?
3. Do you know the total cost to your business of resolving a complaint?
4. Do you know the cost of acquiring a new customer?
Assorted answers from my little test group:
"Am I supposed to know that?"
"Maybe the accountant knows."
(Shrug.) "No clue."
According to the actual survey, here is the breakdown:
Do you know the average annual value of a customer to your business?
Don’t know: 87.1%
Do you know the cost of a customer complaint to your business?
Don’t know: 90.3%
Do you know the cost of acquiring a new customer?
Don’t know: 91.4%
Those numbers kind of blew me away. Anyone with a marketing budget - which is pretty much just about everyone who either owns, runs or works for some kind of business - ought to have at least some idea of how much each new customer costs, right?
Anyone? Anyone? Bueller?
Seriously, folks. This is something we all ought to know.Hat tip to Spike and my zipcode neighbors at BoF for the heads-up on this small portion of Strativity Group's survey (via Fast Company).