Should a customer be valued based on the revenue they have provided in the past? The short answer is “no.” First of all, customer relationships should not be valued based on revenue and second, they should be valued on future profits they can deliver. Why should a company wait until it becomes an acquisition target to understand the value of its customer relationships asset? It should not. CEOs and CFOs, as well as investors, should demand it.
In this article, we focus on customer relationships and offer core benefits a company can achieve by developing and maintaining a dynamic metric that represents the value of its customer asset.