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Defining who is a customer.
We all talk about our customer base but how do we define who
is a customer for measurement purposes. Unless your business consistently has too
many customers, this is an important figure to track.To measure and compare I would suggest an easy method to define
who is a customer to be a person who has been to your shop 2 times in the last 12
months. This is an arbitrary definition but can be used for making comparisons.This method, in its simplicity, does not tell you if the
customer is a good customer, or how much they spent but simply that they
visited your shop and came back a second time.I have been using this method for 3 month in my son’s 15
month old shop to track the potential for growth.I would like your comments or suggestions.
Lowell Nigoff
I owned Lowell’s Bluegrass Automotive (Toyota/Lexus) from
1979 to 2008 when I sold the business as well as the property. I am now helping
my son Brian with the operation of his shop, Brian’s Bluegrass Automotive (all
brands) in Lexington KY. -
4 Replies
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Lowell, I have usually gone with 3 or more ROs since a lot of one time customers had 2 RO’s – added A/C dye and came in for a recheck a bit later, etc. We start an RO for almost everything.
I also use the one year time period, but with the longer service intervals 18 months might make more sense. -
I realize this might be a little slow in commenting but it is most important to measure and look for increases or decreases. The method one uses to measure is not as important.
Lowell
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We our looking at this right now , We had a lot of clients that have only been in once in a year.
Understand at my shop we our very rigid doing inspections and selling needed work so sometimes a client might not need to come in as often as a shop that just repairs per concern of the day.
My belief window is Two times a year average and this depends on your mix of clients age , use age , age of car , fleet service etc.
I also sent out cards to all client personalized in a envelope , addressed to the client.
We have found many had moved , We now our getting ready to call the clients cards that came back for address reasons , to see if we can retain them.My belief window has been not when the last time they were in as more important , will they come back in and our we touching them at least three times a year to let them know we still our here for them.
Would like to know if I am on the right track also [ No Magic Stick ] Thanks Dan R.
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I think it’d make sense to look at this a little differently.
What exactly are you trying to measure?If it’s defining who a “customer” is, I would include a dollar amount with that to make sure you’re including every “edge” case. For example, why not every customer with at least 1 R/O and total dollars spent over $60 or $100? Isn’t that a customer?From another perspective, isn’t everyone a customer?What’s the purpose of knowing how many “customers” you have? If you’re looking for growth, it could be a number of things. Unique customers in 12 months, unique customers vs avg. R/O, or simply repeat business – % of customers that had already been to your shop in the preceding XX months…Define what growth is to you. Usually it’s a mix of repeat & new customers. What about X thousand total customers, broken down into repeat (last 24 months) vs new (never in the database), growth year-over-year, and overall revenue growth?
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