Customer metrics and organisational alignment for maximising customer equity

Abstract

This paper discusses customer equity scorecards for tracking new and veteran customers' performance and recommends a marketing organisational structure where marketing is charged with maximising customer equity. It discusses the analytical underpinnings of the scorecards used to track the dynamics in the customer base and defines the roles and responsibilities of the marketing line and staff divisions, and how they are expected to interact and support each other. With such scorecards, marketing can be held accountable for customer cash flows and must, therefore, focus on activities that directly enhance these cash flows.