The Lifetime Value of a Customer

This morning I received two gifts.  I’m on vacation with my family, and I’ve been thinking, “what should I write for my weekly tip?”  And this morning my tip fell into my lap.

We vacation at the same lake/campground and have done so for 10 years.  The owners of the resort have a reputation for being… difficult.  This includes but is not limited to: yelling at kids, bawling people out for various infractions, and generally being too pushy, and not very nice.

So today, I went to pick up the pontoon boat that we rented from the resort for our party of 12.  I got down to the dock, only to discover that they had reserved a ski boat for us by mistake.  It was too bad, as we had kids with us, and it wasn’t nearly big enough for our group.

Oddly, when I pointed out the mistake to the employee at the dock, he handed me his walkie-talkie and made himself scarce.  Apparently he had seen this movie before.  The owner came on.  I explained the situation, and he blurted out, “Then get a refund, there’s other people that want it.”  A bit blunt, but that’s his right, so I conferred with the group, and we agreed to take the refund and use the boat another day.

When I walked to the main store, he was waiting for me.  And he was not happy.  He bullied, he threatened, and finally he told me that had no interest in renting to me again as I couldn’t be trusted and was wasting his time and money.  I calmly pointed out that I had rented this boat for 2-3 times/summer for the past 10 years.  And, I regularly use his golf course and store and restaurant, and that perhaps this was a misunderstanding that both parties contributed to.

He would have none of it, insisted that it was all my fault, and refunded my money with a lot of ill will.  Before we left, he also had some choice words for my 15-year-old who stood beside me, saying nothing.

I felt mad of course, but as I reflected on it, my anger turned to pity for him, because I immediately recognized in this harried owner, a fellow sufferer of a common complaint among stressed, dominant, high-achieving people.  It’s called “A**hole Disease.”  I know this, because I am a fellow sufferer, although my case has been mostly in remission for a few years now.  Some of my clients have this disease too (you know who you are!).

We all get into these situations with customers.  We feel upset by them, and by the situation.  But before you fully give vent to your disease in your next customer interaction, consider the long-term value of a customer, so that you know clearly who you’re turning away (because some customers are worth firing):

Here’s my case in rough numbers over the 10 years I’ve vacationed at this property:

25 boat rentals @ $400 = $10,000

20 rounds of golf @ $45 = $900

20 restaurant meals for the family = $3000

Regular store purchases = $1000 (?)

Cabin rental = Many thousands of dollars to the cabin owner

So, although I look like a $400 problem, I actually represent tens of thousands of dollars of past and potential future revenue.  Or maybe not future revenue; that depends on how I’m treated.  He might have made a choice more in his interest if he imagined a bubble with ‘$60,000’ on top of my head as he dealt with me.

And so might you next time you have to deal with a customer ‘situation.’

I got my second gift while I drove back to the cabin with my 15-year-old after our encounter.  I congratulated him for not showing disrespect to his attacker.  He sat quietly for a bit, and then said, “real men don’t have tantrums and flip out.”  My heart swelled with pride.  This.  This is what vacations are for.

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