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Return on Customer: Creating Maximum Value From Your Scarcest Resource Hardcover – Bargain Price, June 21, 2005

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Hardcover, Bargain Price, June 21, 2005
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Product Details

  • Hardcover: 304 pages
  • Publisher: Crown Business (June 21, 2005)
  • Language: English
  • ISBN-10: 0385510306
  • ASIN: B003YCQG1S
  • Product Dimensions: 9.5 x 6.3 x 0.8 inches
  • Shipping Weight: 1.2 pounds
  • Average Customer Review: 3.6 out of 5 stars  See all reviews (14 customer reviews)
  • Amazon Best Sellers Rank: #3,110,963 in Books (See Top 100 in Books)

Editorial Reviews


“Finally – a business metric that can drive better management and higher stock price. I predict soon you’ll be hard pressed to find a company that isn’t tracking ROC.”
—Larry Kudlow, co-host of CNBC’s “Kudlow & Cramer”

“Books like this come only once a decade – a conceptual breakthrough that makes instant sense, combined with the toolkit to apply it well. Stunning insight.”
—Scott Cook, founder of Intuit

From the Inside Flap

Virtually everyone agrees that a company's most important asset is the value of its customer base. Yet the value of this vital asset is routinely ignored in managers' day-to-day, quarter-by-quarter planning. RETURN ON CUSTOMER is the first book to focus on assessing and tracking customer equity, the lifetime value of a firm's current and future customers, and taking specific actions in every facet of the company to increase that equity.

First, Peppers and Rogers reveal the critical importance of measuring customers' long-term profitability, productivity, and loyalty. In a powerful blend of theory and practice, the authors use their years of consulting expertise with many of the world's leading companies to identify the specific products, add-ons, and services that will best increase the size and value of their customer base. They look at popular marketing techniques--such as the relentless use of telemarketing--and weigh their effectiveness in maximizing, or hindering, return on customer. Finally, they guide managers through the specific strategies that will help to conserve and replenish customer value, from marketing and sales to research and development, distribution, technology investment, and more.

As revolutionary as Peppers and Rogers' pioneering bestseller The One to One Future, RETURN ON CUSTOMER offers a dramatic new way to make customer retention and value part of a company's core competitive advantage.

More About the Author

Don Peppers was the oldest of five children raised in a small town in Missouri, and he's always had eclectic interests. He earned a degree in astronautical engineering at the US Air Force Academy and then received a masters in public affairs from Princeton, with a concentration in foreign policy. But he has never worked a day in either of these fields. After serving in the Air Force his first civilian job was as an economist at an oil company, and then he became director of accounting at a regional airline. At the airline he gravitated into the marketing field, and eventually went to work at a series of advertising agencies, where he gained a reputation as a successful "rainmaker," concentrating on winning new clients. He wrote about some of his successful (and unsuccessful) pitches in his book Life's a Pitch: Then You Buy. His collaboration with Martha Rogers, a former advertising professor, began in 1990, and their first book together, The One to One Future, was published 3 years later. Since then they have co-authored eight more books together, the most recent being Extreme Trust: Honesty as a Competitive Advantage.

Don and Martha founded a management consulting firm, Peppers & Rogers Group, which now has consultants and offices on five continents and specializes in helping companies improve their customer-facing processes, from sales and marketing issues to customer service, communications, social media, and employee culture. They like to say their mission is "to make the world safe for customers."

Customer Reviews

3.6 out of 5 stars

Most Helpful Customer Reviews

14 of 15 people found the following review helpful By Chris Burroughs on June 30, 2005
Format: Hardcover
ROC - What a concept! I worked for a leading (#2) electronics retailer for more years than I care to discuss. As a corporate employee, I saw mistake after mistake but it wasn't until I read Return on Customer that it all became obvious what was going wrong. The company was focused on short term gains to please the stockholders rather than cultivating customers.

All business decision-makers need to read this book! Peppers clearly articulates what is wrong with many of today's companies and he shows how business people can focus on their customers to increase shareholder wealth.

Peppers describes how telemarketing efforts (something consumers unilaterally hate) may look like they increase current sales; and therefore, produce a hefty ROI. What businesses do not see is that these campaigns actually lose customers for them over the long run, thus decreasing shareholder value.

As you read this book, you can easily recognize the companies you deal with that are customer-focused and those that are not. You may think the concept is obvious - but then why isn't everyone doing it? By measuring Return On Customer, you create loyal customers who then evangelize your company - the best kind of marketing!

Corporate execs and business owners, you need to read this book!
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7 of 7 people found the following review helpful By Christian Neckermann on November 22, 2005
Format: Hardcover
There is a wide-spread school of thought that believes business decisions should be evaluated on their long-term impact. Yet too many decisions are actually driven by short-term results like revenue targets or quarterly earnings. Despite knowing better, it seems that short-term metrics always outweigh long-term benefits in business decisions - sometimes to the detriment of the business (as in cases like Enron).

Don and Martha's book make an important contribution to the business world by raising the awareness of too much short-sighted decision making and their potentially negative consequences. The core idea of looking at "Return on Customer" (ROC) is compelling and easy to understand.

Many related ideas and concepts have been developed over the last 20 years - including customer life-time value, the loyalty effect, etc. - yet the practical applications of these ideas in the day-to-day business world are limited. The ROC book takes many of these ideas and integrates them into a single framework, bringing us one step closer to having a simple, widely accepted approach for putting all of these ideas into practice. If nothing else, it offers one solution and challenges us to continue to work on developing the tools and methodologies that can be put into practice to balance short-term and long-term consequences of our business decisions today.

"Return on Customer" is a very readable book. It provides a compelling case for seeking ways to integrate a "life-time" perspective into how we evaluate business decisions and the managers that make those decisions. It offers many examples - yes, some of them may be redundant or less relevant to some readers - but they make the ideas more than a mere theoretical construct.
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8 of 8 people found the following review helpful By L. Frembes on July 6, 2005
Format: Hardcover
I am self-employed and wasn't sure if ROC would help me at all. I've just started reading it and I already have begun to formulate which changes to make in my business strategy to help build lifelong relationships with my clients. What an excellent book from two very knowledgeable sources.
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7 of 7 people found the following review helpful By Marty Fahncke on August 4, 2005
Format: Hardcover
In an age of deteriorating customer service, it's refreshing to see Peppers and Rogers confront the long term affects of how a business treats its customers. So many businesses seem to forget that eventually they WILL run out of customers. They treat them poorly for years, then sit around scratching their heads wondering why they've lost market share. I highly recommend this book to anyone who deals with customers, and for every business owner, executive, and manager out there.

Can be a bit dry and gets into quite a bit of detailed analysis that may turn some readers off, but overall, the information is timely, accurate, and presented well.
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9 of 12 people found the following review helpful By Thomas Carlson on October 3, 2005
Format: Hardcover
At some point during the book, its repetitiveness will help you realize that there isn't much point in reading further. (I made it through Chapter 5 of 14.)

Page 7 exposes the ROC calculation as an ROI calculation with an estimate of the customer equity (CE) in place of a net benefit of an investment opportunity. The book falls drastically short of showing you how to actually develop a consistent and accurate CE, which is effectivley the customer's lifetime value (LTV).

To get to an LTV or CE for one customer or a set of customers, one has to continue to rely on the inexact art of forecasting and potential. The ROC amounts to another business equation that manipulates guesstimates, forecasts, and sales intuition into a calculation that hopefully can be used to convince financial people in an organization that customer focus is a necessary part of business.

There's no arguing the importance of a customer-centric approach to business. There's also no arguing the need to develop a metric to combat short-term, bottom-line thinking while building a case for long term survival. For hammering home these points over and over and over and over, one has to concede at least two stars. However, there isn't enough material here to justify a book, and since the ROC is a repackaged ROI, I recommend you take a pass.
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