Just Transactions or Recurring Revenue- What Do You Want?

Of course, you do not have any revenue without a transaction being completed. But is your company just after transactions from everyone you can find? Do you believe that every transaction is disconnected from every other one? How many customers do you have to have in order to reach your goals? 10, 100, 1000, more?

And, are you providing all of them the products and services that you can matched up with what they need? A pure transaction orientation means that you start over again with every sale. A pure recurring revenue orientation demands an extensive infrastructure that helps you manage customer relationships and provide the world-class service that is part of keeping them. What you get for investing in and maintaining that infrastructure is multiple years of revenue from loyal customers-people who choose to do business with you because of all you provide, not just on the basis of price.

In reality, no company is all one way or the other. Transaction companies do have repeat buyers. Recurring revenue companies do have customers that do not linger. But the question is, where do you want the majority of your revenue to come from? Take a sample of your best customers. Track how long they have been with you. How much revenue have they generated for your company over that time? How much do you want them to generate in the future?

What are they like and where can you find more people like them? One of the best books ever written to address this strategy is Customers For Life: How To Turn That One-Time Buyer Into a Lifetime Customer by Carl Sewell, and Paul B. Brown. Read it and see what you think.