There are many articles that have been written about the Customer Lifetime Value, and how to calculate the estimated value. Ultimately, the hope is to maximize the amount of money derived from each customer, while also minimizing the acquisition and retention costs. But what happens when the opposite starts to happen? For Sprint, this happened in 2007.
I’m sure we have all had a prospect or client that needed more than their share of hand-holding. They call, text, and email multiple times a day. At some point it needs to be realized that the client may represent a large value, but the amount of time and effort that has to be spent on that client exceeds their lifetime value.
There are two options to alleviate the issue. First, establish limitations and expectations upfront. It is not always best to give the customer everything they want. They usually know what they are getting away with, and will continue to do so. The second option is, “It’s not me, it’s you.” Yep, it’s time to fire the client. It’s never fun, and I have had to do it in the past. Not all business relationships are not a perfect match. Maybe it’s time to start spending 80% of your time with the top 20% of your client book.