Loyal Customer Essay

Title: How to Identify and Keep Your Most Powerful Customers
Introduction
The most important part of an organization’s growth and success is its customers. A loyal customer of an organization is the one who cost less to serve, usually pays more than what other customers do and entice more customers through their personal account i.e. word of mouth. If you also agree to these three claims, then it is the right time to revisit them thus finding about them being true. This research reveals that loyal customers have experienced their worth to the organization and look for premium services. They also feel that services given to them should be cost effective and they would only do positive publicity if they feel that organization has been loyal

There is a simple answer to this. In short words loyalty equals profitability. It is a general phenomenon that if you are loyal to somebody then he or she should be loyal to you. In the similar way when company wants customers to be loyal with them, then they have to do the same with its customers. Keeping this phenomenon in mind an organization maximizes its backward looking metrics like:
1. Share of wallet (SOW)
2. Past customer value (PCV)
3. Recency, Frequency and monetary value of Purchases (RFM)
However it is not important the loyal customer management would lead you to profits. Loyalty and profitability link can be advocated simultaneously. It can be achieved by maximizing and measuring CLV i.e. customer life value. Using CLV exemplar helps companies in making logical decisions about customers and various presumptions to retain and acquire, and additionally ordain the level of reserves that can be bleared on several micro-segments.
Customer lifetime value (CLV)
Customer lifetime value means the value of customer determined over his or her lifetime. In many cases it is calculated as three years. This time period is based on three reasons which are:
1. Customer life

For intersecting customers, business owners should use customer lifetime value metrics. In this para we would get to know how customers can be intersected on loyalty basis by using customer lifetime value approach. The answer to this question is the loyalty is not the only point of focus with loyalty profitability is also to be considered. A loyal customer is the one who comes back to you gain and again. He or she would never leave you for any other company or brand. Even though your products and services are highly priced or low in costs the customers get attracted to your company only. These customers bring in profit which thus shows their loyalty towards our