Customer lifetime value (CLV) is really important to companies and their stock prices. It measures the amount of money a typical person will spend so long as they remain a customer.
Today, after 20 years with the same company, I’m switching cell phone providers. Before explaining why, let me do some math. I’ve paid an average of $150 CAD per month during my CLV, including my kids’ phones. That means over 20 years I paid $36,000 in cell phone services. That’s a big CLV.
OK, so why am I switching?
It’s not just that I think their corporate governance is questionable or, in my opinion, they treated some of their employees unfairly (one in particular that I really admire). I’m not switching just because I don’t like what I see. I’m switching because my $36,000 ended up in their bank account paying for results that I don’t like.
When my money is used to fund things that offend me, then I actually end up paying to make my life less happy, less opportunistic, even less safe…
Is your money used to fund things that make your life less fair? Or even less safe? Or that just makes you shake your head with frustration?
Here are some things that really offend me these days.
- Don’t value my privacy.
- Contribute to the erosion of trust in society.
- Neglect their cyber security resulting in breaches of my personal information.
- Share or sell my data for profit.
- Have bad track records on climate change.
- Have bad track records on diversity and inclusion.
So what can I do?
First, let’s do some more math. Say you spend an average of $100 per month on mobile and internet services from the age of 20 to 70. That’s $1,200 per year for 50 years or $60,000!
Maybe you have 1,000 “friends” who spend the same amount on cell phones. You and your 1,000 friends are handing mobile companies $60 million.
Now let’s say there are 17 million people – that’s the combined population of LA County and The Bay area in California – who spend $100 per month on mobile services, just like you.
That’s a customer lifetime value of over $1 trillion dollars on mobile and internet bills. (I just said $1 trillion).
That’s why I’m switching. I really hope the company I’m leaving chooses to change some of its behavior. I’m not out to get them. But I’m not out to fund their crappy results either.
The question is not what can I do about it? The question is what can we do together as a group that share common interests and a whole lot of buying power?
In the next blog post we’ll talk more about how creating your own terms and conditions can train companies to chase after good results, like trust and privacy.
Click here to join YouOwnYou and to start the journey toward a better and smarter economy.