Several months ago, a friend of mine stopped by the office for a visit. In conversation with a couple of us, he mentioned a recent customer service experience worth sharing - the lesson can be worth 10's or 100's of thousands of dollars to your business.

A while back, my friend had purchased a computer from Dell. He recalled how the invoice for his purchase was incorrect; he was erroneously charged way too much. As he held the invoice in his hand his first thought was "Oh boy! Here we go�..." And this is where our story on customer loyalty begins.

The stories around the room started to fly�...the one about the major computer and printer company that fought over the return of a printer, the overnight delivery company that after months of rude and abusive communications still couldn't get their accounting straight to reflect a payment that had been received, the photo company that wouldn't exchange photos, etc. The stories flied between us, one after another, on why each of us should not do business with one company or another. Meanwhile, we all agreed Dell was a quality company.

But what had Dell done? When my friend called Dell's customer service, sure he would be in a battle with them as others he recalled, they immediately acknowledged the mistake and corrected it. They not only apologized for their error, they compensated him for the confusion, time, and likely stress that resulted from their error. Their compensation was nothing more than a small discount however, the token and attitude they extended my friend was priceless. They understood the lifetime value of their customer.

For a mere $50 discount they not only retained a customer, they retained a customer that will purchase thousands of dollars worth of equipment from them over the next several years, they retained a customer that is willing to recommend them to colleagues, friends, and family. That simple token, attitude, and approach - that measly $50 token wrapped in an accommodating attitude - is priceless in terms of their reputation and ability to retain customers in such a competitive market as computers, printers, and digital peripherals.

Was it the $50 token Dell offered that made the difference? No. It was the gesture of valuing their customer. Dell created an environment whereby they were able to relay a feeling of worth and value to their customer. It's that simple and it can be replicated by any business.

The point of this story is not that Dell is great company, you can decide if they are or not. The point of the story is the impact of taking a long-term view on the lifetime value of your customer. Unless you are clearly in a business whereby you sell a product or service to a customer and you never see, hear, or otherwise ever have to deal with them or any perspective customer they could ever influence again - I can't think of one example of a business like this - you ought to pause and evaluate their lifetime revenue potential to your business. You may find that what once looked like a $10,000 customer, may in fact be a $100,000 customer over the next several years. A $100,000 customer may be worth millions!

The bottom-line is, do you know the lifetime value of your customers? When faced with tough decisions on how to react to a request or handle a messy customer service issue, do you know the lifetime value of your customer and act with that perspective in mind? How much will each customer purchase over a lifetime of association with your business? Do you have business policies and practices in place that reflect this lifetime value?

Do you have a similar story to share? Have you ever been compensated by a company for their mistake or your inconvenience? If so, how did it affect your attitude toward the company? If not, how did it affect your perspective of the company and did you tell others of your bad experience?