The true purpose of a business, Peter Drucker said, is to create and keep customers. "Customer value" has several definitions. I use the 1 to mean the total lifetime value of a company's customer base. Companies can increase this value by 2 more customers, earning more business from existing ones, keeping them longer, making their experience simpler through digital improvements and so on. 3 leaders have long understood the importance of concentrating on customer value rather than pursuing short-term profits or quarterly earnings, and they've become enduring customer loyalty leaders in the process. It's worth noting that a number of loyalty-leading companies are able to 4 shareholder pressure, or avoid it altogether, because they are founder-led, customer-owned, or not publicly traded.
Companies can 5 customer value in a variety of ways: To increase 6, enterprise software companies sometimes charge corporate customers change fees that can raise the total cost of ownership to as much as three times the original price. To reduce operating costs, restaurant chains sometimes 7 frozen and precooked ingredients in place of fresh and made-to-order food. The resulting profits may look good on the income statement. Such strategies may even lead to short-term earnings growth. But they also 8 potential customers and encourage disloyalty.
Given the importance of customer value, leaders should track it as much as they track other key assets (资产), such as buildings, machinery, and marketable securities. They also should reveal it in their quarterly and annual earnings releases so that investors can make 9 judgments about company performance and how it compares with that of industry peers. But most companies 10believe that measuring customer value is too difficult or costly. They continue to rely on a centuries-old accounting tradition that emphasizes physical and financial assets, and neither income statements nor balance sheets offer much 11 into the value of a company's customers.
As investors wake up to the importance of customer value, however, many growth-stage companies now direct investors' attention to12in growing the value of their customer base. Some public companies increasingly report various types of customer value metrics (指标). One of the UK's top energy suppliers E.ON,13, reports year-over-year customer counts in its financial report. "As a customer-focused company," E.ON noted, "we see customer value as crucial to our success."
This is a start, but because there are no customer-value reporting standards or requirements, investors still have a(n) 14 picture. The minority of companies that do provide customer value information decide for themselves what to disclose. 15, firms may calculate customer metrics differently or change them to tell a desired story, or simply stop reporting them if they fail to go with the company's preferred narrative.
