Blog
Category: Metrics
Great article on retention economics
On 04, Aug 2009 | In Metrics, ROI marketing | By Marcia K
Most people look at retention as something they measure annually – which misses the opportunity to respond to early warning signs in your installed base. So when I read this article over on Chief Marketer I got suitably excited … because it is right on in pointing out how to measure retention using two metrics that are much more immediate: dollar retention rate replacement rate Dollar retention rate A customer who spent an average of $1000/year drops to $50/year. Is the customer retained? She didn’t leave, so traditional retention measures would show no churn. Clearly this doesn’t capture the erosion in value. Instead, use “dollar retention rate,” which measures the percentage of revenue retained over …
Metrics – best practices
On 21, Jun 2004 | In Metrics, ROI marketing | By Marcia K
It’s been said many times: “you get what you measure.” The choice of which metrics to use is a strategic one and should be made with care. Do not measure results based on volume alone e.g. the number of leads generated, number of new customers acquired. Volume alone tells you very little about either efficiency or effectiveness. The most meaningful metrics are those that get to the value of the customers you acquired in a given program. Examples include ROI and LTV. If your company does not have the infrastructure to measure ROI or LTV, you may need to rely upon other metrics. A best practice is to balance your metrics to include data on …
