HOW TO: Measure the true value of a customer
We investigate the difference between return-on-investment and return-on-customer
Ask any marketer what sums up their profession over the last couple of years and you’ll get pretty much the same answer; return on investment (ROI). But while ROI is a tangible and valid metric, it isn’t the only one that should be considered.
‘Return on customer’ (ROC) is an alternate metric, one that helps to measure the true value of a customer. While ROI certainly has its own role to play, by just using this measurement you’re basing everything on earnings. But are purely accounting numbers a true representation? Customers are a more valuable metric than just money.