Most companies assume customer value is directly measured by the amount of revenue generated by a customer. While a company’s accounting department should probably think of customers in terms of revenue, profit, and loss, the true worth of a customer is multidimensional, and marketers should consider all of the dimensions that create customer value. Depending on your business model, your financial state, and the maturity of your company, choosing the right dimensions on which to measure customer value can mean the difference between success and failure.

So what are the factors that make a customer valuable? We have outlined four dimensions of customer value: revenue, loyalty, sentiment, and engagement. Find out how you can adjust your strategy for each dimension and create marketing offers, loyalty programs, customer service, and other programs to drive more value.


The first of the dimensions of customer value is the most straightforward – the more money a customer spends, the higher the revenue for your company. Though not tied to profit, there should a correlation between the two. This is the most direct measure of value, as it ties every customer to clear, measurable financial metrics that have already been observed. You can use revenue generated by a customer to determine whether the customer has an appetite for more expensive products or categories or whether they may be a good candidate to target with exclusive products or donation requests.


Loyalty is a measure of the customer’s likelihood of making future purchases and generating revenue. Would you choose a customer that spends $1,000 today and never again, or one that spends $100 today and likely will return every month for the coming years? Generally speaking, loyal customers are preferred as they tend to spend more in the long run. They are the ones who return to your brand, spending money regularly and providing much-needed cash infusions into your business. Loyal customers also often provide additional value by referring other people to your brand or business, generating buzz through social media and word-of-mouth, and writing favorable reviews. You can look at past purchases and interactions to determine a customer’s level of loyalty, and target them with rewards and offers that incentivize them to continue returning to your brand for products and content. Many brands and businesses have created successful loyalty programs that encourage customers to return with special offers, exclusive content, or “tiers” of access. You should also aim to provide top customer service to your loyal customers since they will provide more value over time.


Related to loyalty, another one of the dimensions of customer value is sentiment: happy customers tend to be loyal, and likely will spend money in the future. Customers tend to tell their friends, colleagues, and acquaintances about their experiences with companies and brands, and the happy customers will drive more customers to your business and increases in future revenue. Unfortunately, determining a customer’s sentiment is not always easy because most customers do not actively look for ways to tell you about their experience. There are steps you can take to gauge your customers’ satisfaction levels, however. You can send emails with post-purchase surveys to your customers or ask customers about their experience when they make a purchase. You can also send periodic NPS surveys or hold focus groups with individuals after a particular experience.


Engagement is your final indicator of a customer’s value. If you have a potential customer (no revenue, no loyalty) who is engaged with your company or brand, you have an engaged lead that can be converted into a sale. You can measure engagement levels by tracking the person’s interaction with your website, social media posts, email campaigns, and ads. Once you have gathered some data on the content the person engages with and their engagement level, you can create more targeted offers and campaigns tailored to their specific needs and interests. Abandoned web-browse, abandoned cart, and win-back (or re-engagement) email campaigns are great ways to leverage engagement levels when interacting with potential or past customers.

All four, together

Together, these four dimensions provide a framework you can use to categorize every customer. You can apply weights to each dimension to create a framework for your specific organization. This framework allows you to score customers, enabling you to create segments and target customers with offers that appeal to the ways in which they are creating value for your business. It also helps you understand the different ways in which you can increase the value of your customers by appealing to the dimension on which they have a lower score. For example, an unhappy-yet-loyal customer should be a priority since this segment of customers have consistently supported the company and will likely continue to make purchases if their satisfaction-level improves. Alternatively, an engaged customer who has not created much revenue for your business may begin to make higher-value purchases if targeted with the right offers.

Using the four dimensions of customer value to create a framework, you can prioritize customers and clarify opportunities. You will have a better understanding of the marketing activities and campaigns that are likely to drive results with different segments of customers, and you will have the ability to track and monitor customer value over time.

To find out how your company’s data capabilities match up, click here to download our free Customer Data Framework.