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Working out your customer market value will only reveal a fraction of the picture. The larger scene is revealed when you understand the value of your customers to the market place and your share of their wallet, says Julian Berry.
Customer value (see jargon buster, page 26) is rightly regarded as a key component of CRM. However, it is only one of a range of measures required to develop and optimise your customer management strategies.
In highly fragmented markets, such as retailing or financial services, where the customer may have a wide portfolio of suppliers, the customer value alone can only provide part of the picture. You need instead to understand the value of the customer to the market place (or customer market value - see jargon buster) and your share of their wallet (see jargon buster). After all, it's difficult to develop a customer when you already have a large share of their wallet.
Understanding share of wallet helps you decide which customers may be worthy of further investment and what marketing strategies may be appropriate for the different groups of customers. For example, …