The marginal cost of an extra customer.

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The marginal cost of an extra customer.

Category : Blog , Random thoughts

The marginal cost of one extra customer if you can produce at a marginal cost of almost zero is… well… almost zero. So economical theory suggest you should go for that extra customer with all of your heart. Even without economics, people tend in a natural way to aim for an extra customer.
But is the total cost of that extra customer as low as you think? Should you not incorporate a cost of a lower availability, a lower service level, a less personal service,… for all of your existing customers? Knowing when that extra customer will start hurting your current customer base is as important as knowing how to get her in the first place.


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