Customer Profitability
This debate is beginning to seriously concern supporters of modern management techniques. The principles of the profitability of the offer, meaning the product or prcduct line, are widely known. By taking into consideration several elements that afe relevant to the customers themselves (the importance of the price, problems in dealing with certain customers, the services expected by others, etc.), it is legitimate to wonder whether establishing customer profitability is not the required complement to, or the intelligent substitute for, product profitability. Research has shown that there are large differences in profitability from one customer to another (Turnbull and Zolkiewski, 1997). In particular, we have already shown that investments for a given customer are important and they must be offset over time. Keeping customer loyalty is less costly than gaining new customers. Different customers do not generate the same amount of cost from their supplier, and therefore the selection of customers is important to the overall profitability. The principle of establishing customer profitability.
The comparison of the different levels of 'marketing contribution' from several customers enables us to have an additional view to that of the profitability per family of offers or products, and consequently to orientate the company's commercial strategy.
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