The Long and Short of It Is...
If you won the lottery, would you spend it all at once, or sock it all away to use later? Most people would try to do a combination of both, balancing their long- and short-term financial goals. The same should be true with how companies deal with customers. There has got to be a balance between getting as much money from customers as possible at once, and building loyalty and lifetime value over time. Move over too far in either direction, and you may destroy customer value or run your business into the ground. Or both. Which is what happened with many mortgage lenders that took advantage of the subprime loan market.
Today's issue of 1to1 Weekly looks at the mortgage industry meltdown from a customer strategy angle. Looking through the customer lens, it's easy to see that the decisions some of these lenders made were only looking out for short-term financial interests. And as interest rates rose, homeowners and their lenders suffered negative consequences.
This situation solidly illustrates the need for balance. And there are many companies doing a great balancing act. We want to hear your stories. How does your company balance its short- and long-term strategies?
