Increasing customer profitability in a challenging economic environment
Companies often make considerable efforts to retain customer interest by offering more and varied services to existing customers, seldom keeping an account of the cost aspect of same. In the process of being customer focused, they channelize their endeavors towards blind customer fixation, thereby disturbing the delicate balance of customer satisfaction and business returns.
The answer to the aforesaid dilemma lies in measuring customer profitability at an individual level for accurate and valued insights into the revenue generating groups which can greatly enhanced by using a customer profitability scorecard. Such a tool can help in the roll out of feasible and practical pricing policies go a long way in managing the customer profitability at the core of any business strategy adopted for increasing company turnover.
Early detection and awareness of the unprofitable cluster will facilitate the business in drawing up an implementable cost benefit analysis and reduce the losses in the long run.