he perennial cry from CEOs around the globe is that they are focused — above all — on their customers. It is their highest priority, the critical mission of their companies. Every decision emanates from understanding what customers need and want ... then delivering it. You may have even said this yourself.

When you think about it, your customers are your company’s biggest asset. They should be managed like any other asset, with a keen eye to growth, development, and profitability. Elementary, right? So why aren’t more companies more successful at managing their customer base with a long-term vision and plan?

Organic customer growth drives long-term profitability. Yet it is rarely given as much attention as quarterly sales goals. This is where the lip service to customer commitment often falls apart, because what is actively sought, measured, and rewarded doesn’t always line up with what’s good for customers — or for your company in the long term.

For example, consider this company: a business-to-business enterprise that focused on the number of customer accounts rather than the acquisition-and-loss flow or the quality of those accounts. The sales team was led by a former fighter pilot who sent the sales force out for what they actually called “speed kills.” They were fired up to get as many customers as they could, as fast as they could. But they weren’t keeping track of the value of business that each new customer would bring. To them, one unit was one unit.

Customers had become widgets.

Each speed kill carried the same weight on the white board used to measure success. The sales team exceeded its goal for new customer accounts that year, but sales became a drag on profits — which actually declined. This is because sales didn’t focus on the profitability of customer accounts, just the number of them. And no one actively identified, prioritized, and eliminated issues driving profitable customers out the door.

Without up-to-date information about profitable versus non-profitable customers and an eye to identifying and tracking what is keeping your best customers in the fold or driving them away, CEOs and business-line executives are unable to manage customers as assets. As the leaders of each business unit report and recommend customer actions separately, CEOs often react to the immediate issue on the desk rather than focusing on larger or more universal problems that erode customer loyalty and customer profitability on the whole.

The good news is, as event managers, you are in a unique position to add to your CEO’s and executive team’s understanding of the five key customer metrics that foretell your company’s success. Your access to customers — face to face, several times a year or more — gives you unparalleled insights into what matters to them most, how their needs are evolving, and what they expect your company to do for them. By reporting your event program’s results as they relate to customer profitability, you’ll be among the vanguard leading the charge to keep customer profitability at the center of your company’s strategic planning efforts. And when annual budgeting and planning time rolls around, you’ll be able to easily show the impact that effective events have on retaining and growing the best kind of customer — a profitable one.

The Five Metrics Your CEO Needs to Know

When working to understand the customer-profitability end game, five key measurements will help you see the patterns and trends that tell a powerful story about your customer assets. The metrics establish a common language for your executive team that places customers front and center in how they ask about — and talk about — the state of your business. They are a potent first step to kick-start or reenergize a faltering customer focus.

The metrics work because they clear through the clutter usually encountered in the drive for customer experience and profitability, including 1) inconsistencies in defining, reporting, and managing the state of your company’s customer relationships, and 2) focusing on survey administration and negotiating survey scores rather than driving action and accountability. These metrics give leadership five questions that command customer accountability inside their organizations. Be ready to answer them in event-program terms.

1. Who are our new customers? Your company should be as interested in the volume and value of your incoming customers as it is in short-term sales goals. You may find that you are tracking incoming customers across several company areas — with conflicting definitions of what it means to be a new customer, and how those customers are classified within your company. The part that’s not likely tracked at all is the quality of incoming customers. This is especially important as the market becomes increasingly more saturated and new, profitable customers are harder to come by.

When reporting your own program’s successes to management, first work with your marketing-analytics team to identify which of these new customers also encountered your company at one of your events — either before or shortly after their first purchases. Are there particular events that pop up most often among this customer group? How will you build on those successful events as customer-acquisition tools in future years? How can your events strategy help segment and support your newest customers, moving them more quickly into growth mode?

2. Who are our lost customers? Pair this question about lost customers with the one above about new customers to lay out the true situation for your company. You must reconcile “customers in” with “customers out” to know how well you are doing with managing customers as an asset of your company. In addition to knowing which customers left, you need to know the reasons they don’t care to do business with you any more, so you can drive change across the business. Without this information, the organization misses a massive opportunity to galvanize people into taking corrective action.

When examining lost customers, explore their history with your events. Did they attend more than, the same as, or less than your retained customers? If they attended at a lesser rate than your loyal customers, report to management what plans you will put in place to draw more of these at-risk customers to your events. Will you create an event tailored specifically for this at-risk group? What will it include? And how will you report what you learn about your at-risk attendees back to the rest of the company in actionable terms?

3. Which customers renewed at what rate and why? This requires defining and understanding patterns that indicate loyalty based on continuous purchase habits. You must ask for reasons your customers are staying with you, to ensure that you know what you are delivering to customers that they value — and to ensure that you are well aware when these reasons shift or begin to erode.

Events are an ideal place to get inside your customers’ heads, both overtly and analytically. You can survey customers, of course, to find out what’s driving them today, where their pain points are, and how your company is — or isn’t — addressing them. Track seminar attendance for trends in topic interest, and cross-reference that topic interest against customer purchases. Are there correlations you can draw and report? Looking ahead, how can your event strategy reward and sustain these growing customers?

4. What is our profitability and revenue by customer group? Getting to this classification of customers is not a trivial project. Your goal should be driving efforts that cause your costliest customer groups to decline and those most profitable to grow. Getting this data in line to achieve a clear view of accountability around customer profitability patterns will take some time, but stay the course. It will optimize your ability to manage customers as an asset of your business.

Show your executives how your events have and will continue to support this important objective. Will you scrub your invite lists for costly customers, while ensuring profitable customers are given every opportunity to attend?

5. What is our referral rate in each customer segment? If your customers are willing to stick their necks out to vouch for you, they have become your marketers. Keeping these customers, growing them, and developing other customers like them should be your highest priority. If you can track the rate of referrals in general and by customer group, you’ll be able to estimate your future revenue stream based on historical patterns before you spend another dollar on marketing.

Companies completely focused on customer profitability will learn how referral rates differ by customer group and reasons for not referring. They will rigorously apply this learning to constantly adjust and improve.

As a referral reward, events can be a powerful incentive. Show your management how events can be used both to reward customers who refer to you, and as a source of those referrals.

managing customers is not negotiable

According to a November 2004 Harvard Business Review article titled “Bringing Customers into the Boardroom,” customer-management issues being elevated to the board level are on the decline. Among the large U.S. companies surveyed for that article, more than one-third said their boards of directors spent less than 10 percent of their time on customer-related or marketing issues.

But your company’s success hinges quite literally on your customers, and their contributions to your bottom line. Managing the value and trend of profitable customers is not negotiable.

You can use the five metrics as a tool to define, quantify, and connect the dots for your peers, management, and CEO as to how your events program contributes to managing customers as a key asset of your company. Perhaps most important, these metrics breed perspective: keeping the focus on high-priority customer issues, showing how events are a critical component of customer acquisition, retention, and profitability, and garnering the investments you need to continue your efforts to help find, keep, and grow the right customers for your business.

So remember, it’s not enough to simply have these metrics in hand. It’s what you do with them that matters. To make the metrics stick, and to use them to steer your event strategy and your business, you need to bring them to the top of your reporting priority list and keep them front and center as your personal mantra. e