All customers are equal but some are more equal than others.

Good customers, who are they? Do they matter?

Good customers are the backbone of any successful business. They contribute disproportionately to profits, often accounting for 150-180% of total profits. With realistic expectations that result in fewer demands on time, energy, and resources, they are more cost-efficient to serve. They are also more likely to engage collaboratively, providing valuable insights and feedback that help businesses refine their products and services.

Identifying these high-value customers requires data-driven insights which can be derived using the RFM framework:

• Recency: How recently has the customer made a purchase?
• Frequency: How often does the customer buy from you?
• Monetary Value: How much do they spend?

Two key metrics further refine your analysis:

• Average Order Value (AOV): The average amount a customer spends per transaction
• Lifetime Value (LTV): The total revenue a customer is expected to generate over their relationship with your business. This is calculated using the formula [LTV = AOV × Purchase Frequency × Customer Lifespan]

Beyond financial metrics, your best customers are those who not only contribute financially but also use your product to effectively solve their business challenges or meet personal needs. They align your product's capabilities with their goals, integrating it seamlessly into their workflow to maximise its potential and derive significant value. Furthermore, they act as brand advocates, recommending the business to others. This is often tracked using net promoter scores.

What’s next after identifying the good customers? Create more of them. We can do this by educating the market to think and act like the good customers when engaging with your business and products. One critical aspect of designing a learning programme is defining the learning outcomes. For businesses, we want to define what makes a good customer in actionable terms. We do this using the ABCD framework:

• Audience: Who exactly is your ideal customer? This identifies the specific segment of customers who demonstrate the most value to your business. The audience component establishes precisely who you're targeting with your profiling efforts.
• Behaviour: What observable actions do good customers take? This component identifies specific, observable behaviours with which they engage with your products.
• Condition: Under what circumstances do these behaviours occur? This examines the context in which good customers operate, including the situations and environments within which they use your products.
• Degree: To what extent or how well must these behaviours be demonstrated? This establishes the measurable standards that define success.

Profiling good customers using the RFM analysis and ABCD framework creates the foundation for transforming your market to think and act more like your best customers. As your market adopts these thought patterns and behaviours through your educational initiatives, you naturally cultivate more good customers who align with your ideal profile.

The ABCD framework thus becomes not just a descriptive tool but a prescriptive one—a blueprint for customer education that systematically expands your pool of high-value relationships. By transforming customer development into a structured educational process, you create a sustainable pathway to business growth built on a foundation of well-defined customer excellence.