The Value of a Customer. Why You Are Special and Why Does It Matter.
The Driver of All Marketing Efforts
You need to determine what the value of a customer is to your company. Answer the following questions:
How much will the average customer spend with you per year?
A = _____________
If you provide quality service and products, how many years can you expect to keep a customer ?
B = _____________
What is your gross profit, as a percentage of revenues?
C = _____________
The value (V) of a customer is:
V = A X B X C
We learned with our network consulting company that the average life of a customer was about 2 �½ years and the average yearly expenditure was around $10,000. With a gross margin of 35%, each client was worth $8750 to the company.
$10,000 X 2.5 * .35 = $8750
If you haven't used this simple formula before, it can totally change how you view customer acquisition, retention and customer service. Normally you'll want to spend about 10% of current or projected revenues on customer acquisition. This formula allows you to accurately project what a customer is worth to you over their customer life cycle.
A valuable concept to learn and leverage is to go to great lengths to keep a good customer. The simplest and least intensive marketing efforts are those that you do for existing customers. Stay in contact, educate them on the excellent services you have provided them and the value proposition that you offer.
Close Ratios
The next important parameter is to calculate your close ratio. This means for every prospect you talk to, how many become customers? We had a close ratio of around 25%. With the above example, assuming a marketing budget of 10% of gross revenues per customer, we had $1500 to work with. With a 25% close ratio, that meant we could spend on average $375 for every prospect we talked to ($1500*.25=$375).
This is a very useful tool for making decisions around how much time to spend on proposals, contact, lunches and other prospecting activities.
Bryan Brandenburg has published 5 books as well as a number of articles both in print and on the internet. He has published almost 30 software programs both for consumers and business. More information can be found at www.vmmg.net
Article Source: http://EzineArticles.com/
Why &you are special'?
Why and how does it matter?
Things you can say to yourself to feel great and special always.
Why &you are special'?:
You are special. Just like your fingerprint is unique, you are a unique person with a special purpose. No one is born to do the things you were born to do.
You are special because God made you special.
"You made all the delicate, inner parts of my body and knit me together in my mother's womb. Thank you for making me so wonderfully complex! Your workmanship is marvelous--and how well I know it." (Psalm 139:13-14 NLT)
A great philosopher James Allen wrote in his book &As a Man Thinketh' -
"As a being of power, intelligence, and love, and the lord of his own thoughts, man holds key to every situation, and contains within himself that transforming and regenerative agency by which he may make himself what he wills."
Do not compare yourself with others. There is no need to compare yourself with another person. If you look around, there may be many people who excel in your field. You can learn from them, but do not let them intimidate you. Never, ever compare yourself with others whether you feel they are superior to you or inferior to you. Do not let that hinder your genius. Be your best and that is all what matters. When you are at your best, everything you do is a masterpiece. You do not have to prove anything to anybody.
You have the same three-pound brain like everybody else, which is capable of doing wonderful things. There is a story about C.V.Raman, a genius who won the Nobel Prize for Physics: One of his students was once experimenting with an X-ray tube of 1-kilowatt power. The student felt depressed when he came to know that a scientist in England is experimenting on the same problem with a 5-kilowatt X-ray tube. With a smile, Raman suggested his student, "The solution is very simple; use your 10-kilowatt brain on the problem." You too have the 10-kilowatt power brain and you too can use it for your own special purposes. The whole world of opportunity is open to you. Think of all the wonderful things you can do and enjoy.
Why and how does it matter?:
By realizing that you are special, you can make a difference in the world, you can have an impact on your surroundings. The successful accomplishments of your goals and dreams lead to greater contribution to yourself, your family, and the world.
By being your best, you can make a great impact on the society, like Thomas Edison, Henry Ford, or C.V.Raman. You have the unique qualities and exceptional genius. Imagine the impact the world can experience by having hundred Edisons.
Take action. There was a young man who was an artist. He used to get discouraged thinking that, may be there are other good artists who are better than he is. Few of his friends encouraged; few others discouraged him. He went ahead and participated in the competition anyway. When he won the award, a guy commented, "This does not mean that you are the best. There may be other good artists, who did not participate in the contest". May be true, but participation was important. By not participating, you lose your chance to be successful.
By taking action, you bring your unique credentials to the table. You make the world a better place to live. Step out and do something.
"The difference between what we are capable of doing and what we do, can solve most of the problems in this world." - Mahatma Gandhi.
There is enough for all of us. There is an abundance of good things and abundance is available to you. By keeping in mind that you are special, you will have abundant supply of opportunities and ideas to excel in your chosen endeavor.
Things you can say to yourself to feel great and special always:
Take a piece of paper and write down the following self-affirmations. Keep the paper with you always and read it whenever you can, minimum two times a day. You will experience a difference, because spoken words are so powerful.
- God made me special.
- I am a lot stronger and more powerful than I think.
- I have unlimited potential.
- All the power is within me; I can achieve anything I set my mind to.
- I am abundant. My life is abundant with good things.
- Every day, in every way I am becoming better and better
- I strive for excellence in everything I do.
- I deserve the best.
You deserve to be successful. You deserve to be great.
About The Author
Vinayak Bhat is a software consultant and a business owner. He is one of the editors at Success4Sure.com, which provides the excellent tools and resources to help you in realizing your goals and dreams. You can find many free articles, e-books and successful home business tools at http://www.success4sure.com This article may be freely reprinted and distributed in its entirety only, providing this entire byline.
Article Source: http://EzineArticles.com/
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