How to resolve AdBlock issue? David Moloney’s advice: keep customer tenure and help them live longer, happier lives
By Leon Gettler, Talking Business >>
WHAT MAKES a successful business these days?
David Moloney, CEO of the Internal Consulting Group said the most successful companies have created pillars and platforms.
“As an example, Apple, Microsoft and Google share a pillar: platforms/ecosystem model that enmesh customers. More data, payment info, purchase history and loyalty a company holds equals the less likely customers are to switch,” Mr Moloney said.
“The reason, of course, is s term most people are familiar with – engagement – morphing into something I call enmeshment where customers are less inclined to switch because more of their information, more of their payment infrastructure, more of their buying history and patterns, more of their loyalty history and program points are collated and then deployed for the interests of that business through that platform or eco-system,” Mr Moloney told Talking Business.
“Apple and Google and Microsoft now benefit from what is called cloud rent, which is the excessive premiums they charge us mere mortals for being to participate in their wonderful eco-system.” 
Behaviour comprehension is the major advantage
Mr Moloney said (the platforms) understanding customer behaviour gives them a huge competitive advantage.
This leads to hyper-personalisation and what he called the “segment of one”.
Mr Moloney said a lot of companies focus on building customer loyalty but they make key mistakes.
“People forget that customer lifetime value is a factor of two things,” he said.
“What share of wallet you get – and then, how long do you get that share of wallet for and most companies are overly focused on the former and not the latter.
“And so we see efforts to invest in that personalisation – typically the term used by the customer advocacy people as engagement, NPS or Net Provider Score, and reducing friction. With the less friction I have, the less likely I am to switch, but then I’m looking for my need to be met and the be delighted from time to time.”
Holding tenure over customers
This, he said, is connected with the company’s tenure over the customer.
“How many companies are investing in a life span and health span as well?” he said.
“That’s one of the meta-trends, which we haven’t seen picked up by corporations, that they might.”
Mr Moloney said companies don’t do this because they’re focused on quarterly results and their long term incentive plans go out to five years at best – and the average CEO is only in the job for five years.
“Certainly the health and life insurance companies are already worried about reducing their total cost of claims, which indirectly leads to a longer customer lifetime value,” Mr Moloney said.
“But mainstream has not picked that up because we are so enamoured with fast food and sugar.
“If you can get your customers to live five or 10 years longer because they eat better food or they go for the odd walk, then customer lifetime value will increase very significantly,” he said. 
“So it’s not just about squeezing an extra 1% or 2% out of the wallet. It’s also doing it in a way which helps your customers live a longer, happier life.”
Hear the complete interview and catch up with other topical business news on Leon Gettler’s Talking Business podcast, released every Friday at www.acast.com/talkingbusiness
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