April 18, 2022

Future Value, Measured Two Different Ways

Here's our example from yesterday.


Here's some of the raw data from the cohort that purchased 26+ times, life-to-date.

Next 12 Month Net Sales:

  • $1,072 for Low-Margin History.
  • $961 for Avg-Margin History.
  • $943 for High-Margin History.
So, on the surface future value looks better for the low-margin cohort.

Now we move on to 12-month gross margin dollars.

  • $433 for Low-Margin History.
  • $532 for Avg-Margin History.
  • $573 for High-Margin History.

We see a different story, don't we?

Two different metrics, two different outcomes.

Which customer would you prefer to Develop?




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