Core Customer Metric Always, All Ways?
Core Customer Metric…What thoughts, images, ideas or feelings come to mind when you see or hear Core Customer Metric?
What exactly is a Core Customer Metric?
A Core Customer Metric is a key measure of how strongly customers embrace your brand, and how committed they are to continuing to buy from or to do business with you.
Ideally, a Core Customer Metric (CCM) is the most accurate measure of your customer base. A Core Customer Metric should serve as a leading indicator of downstream business results, and also furnish a key measure of overall organizational health and progress. An accurate Core Customer Metric is critical as it should help drive your customer strategy and growth plans.
How does your organization determine it’s Core Customer Metric? Do you think that it is the most accurate measure? Could there be another Core Customer Metric that is a more accurate predictive measure?
Many experts would agree that a Customer Loyalty measure should provide the best Core Customer Metric. But is a one number metric enough? Net Promoter Score (NPS) has recently attracted a lot of attention, and criticism, for its one metric simplicity. NPS is based on asking “The Ultimate Question”, “On a 0-10 sale, How likely is it that you would recommend (Company X) to a friend or colleague?” and then subtracting the % of 0-6 ratings from the % of 9-10 ratings.
Many would argue that while the “would recommend” question is a good question and has been used for years, it may not be the most accurate or predictive measure of customer loyalty based upon your specific market structure, customer type, business goals etc. As an example “share of next ten visits” proved to be more strongly correlated with actual customer loyalty behavior than “would recommend” measures in the study in this article.
Perhaps in some cases customer loyalty might not even be the most appropriate Core Customer Metric for your organization. Customer attitudes, experiences and behaviors must all be considered and new Customer Experience metrics are providing valuable insights.
In your search for your ultimate Core Customer Metric, you might even consider determining your top Core Customer Metrics and build a Core Customer Index, to perhaps then calculate a Core Customer Score.
But it all must start simply in first determing which Core Customer Metric is best for your specific organization and goals. It begins with a best practice approach, like at the end of the article above, to knowing what is best to measure.
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One Response to “Core Customer Metric Always, All Ways?”
January 16th, 2008 at 12:57 pm
Composite measures are often more useful than a single-item score. These types of core customer metrics often reflect the complexity of your business and the customer’s evaluation of what’s important to them.
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