How To Measure customer Value

Personal Development

By Kay Fitzgerald
Published November 14, 2020

Customer value is  the measure of your customers preference for a product or service

Customer value will determine whether your customer feels they received value for what they paid for the product or service

We normally measure value using three scales:

- Market share
- Customer share
- Customer lifetime value

Scales

Three

This relates to how many high-value customers does the company have from the marketplace.

Share

Market

How much of the "spend" of the high-value customers do you actually have?

Share

Customer

How long will the customer stay with you and how much are they worth to you over that time?

Lifetime Value

Customer

Let's Now introduce two metrics used to assess customer value

Most valuable customers, or MVC, are the customers that are the most profitable for the company.

Customer

Most Valuable

Most growable customers, or MGC, are the customers that may have little value at the moment but have considerable potential.

Customer 

Most Growable

How long will the customer stay with you and how much are they worth to you over that time?

Lifetime Value

Most Valuable

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