Customer Portfolio Management
Creating Value with a Large Leaky Bucket of Customers
Reeks: Management on the Cutting Edge
Fred Selnes ; Michael D. Johnson
- How
- to
- create
- value
- with
- all
- the
- customers
- in
- a
- portfolio,
- from
- the
- stronger
- relationships
- that
- increase
- profit
- margins
- to
- the
- weaker
- relationships
- that
- increase
- scale.Which
- would
- you
- rather
- have:
- a
- smaller,
- watertight
- bucket
- of
- loyal
- customers
- or
- a
- larger
- leaky
- bucket
- of
- both
- loyal
- and
- not-so-loyal
- customers?
- In
- Customer
- Portfolio
- Management,
- Fred
- Selnes
- and
- Michael
- Johnson
- argue
- that
- for
- most
- companies
- and
- organizations
- the
- larger
- leaky
- bucket
- is
- more
- valuable.
- While
- loyal
- customers
- are
- generally
- more
- profitable,
- the
- weaker,
- or
- “leaky,”
- relationships
- in
- a
- portfolio
- provide
- scale
- economies
- and
- a
- source
- of
- future
- loyal
- customers.
- The
- basic
- principle
- behind
- customer
- portfolio
- management
- (CPM),
- they
- explain,
- is
- to
- view
- a
- company’s
- market
- strategies
- as
- long-term
- investments
- in
- the
- strength
- of
- relationships
- over
- an
- entire
- portfolio
- of
- current
- and
- future
- customers.This
- book
- helps
- business
- leaders
- understand
- when
- and
- how
- much
- to
- focus
- on
- acquiring
- customers,
- how
- to
- defend
- and
- leverage
- those
- relationships,
- and
- how
- to
- convert
- some
- of
- these
- relationships
- into
- stronger,
- more
- profitable
- ones.
- The
- authors
- present
- an
- implementable
- framework
- for
- CPM
- that
- involves:Case
- studies
- and
- examples
- that
- include
- Amazon,
- Apple,
- IKEA,
- and
- dozens
- of
- other
- companies
- are
- used
- along
- the
- way
- to
- illustrate
- effective
- portfolio
- management
- principles
- and
- growth strategies.
