By now, if you’re in marketing you’re probably familiar with the concept of customer lifetime value. Put simply, it’s the idea that a customer is worth to the organization not just the value of a single transaction, but the collection of all of the transactions that they might make during their relationship with you. And when speaking of customer lifetime value, we generally don’t talk about any single customer, but speak about their value in aggregate, averaging out the high value (many, many purchases) and low value customers (one or a few purchases).
The concept is usually linked to discussions of how much you can afford to spend to acquire a customer and whether a particular advertising or marketing effort is worth undertaking.The concept has been even applied to non-profits (lifetime donor value) and even to social media ROI.
But what’s a good outside innovation partner worth?
As I was speaking with several of the innovation leaders at Intuit on their campus in Mountain View recently, it came to me that organizations should be seeking to build and strengthen relationships with their customers, suppliers, and other potential innovation partners in ways similar to their approach to traditional relationship marketing.
Having done work in relationship marketing strategy, it seems to me that there is no reason why the same principles can’t or shouldn’t be applied to your potential innovation partner community.
After all, as more and more companies begin to understand and engage in the practice of open innovation, then there will be an advantage accumulated by the organizations that do a good job of building strong and profitable relationships with the most passionate and prolific suppliers, customers, academics, etc. over those organizations that don’t.
What organization out there wouldn’t want to accumulate an innovation advantage, a growth advantage, a relationship advantage over their competitors?
But the real questions are of course:
- Do you have the required internal innovation capability built already to support open innovation?
- Are you engaging in open innovation already? Or are your competitors?
- What are you doing to build strong relationships with you potential innovation partners?
- Are you tasking skilled relationship marketers with creating and maintaining these conversations and building these relationships?
So, do you? Are you?
Braden Kelley is a popular innovation speaker, embeds innovation across the organization with innovation training, and builds B2B pull marketing strategies that drive increased revenue, visibility and inbound sales leads. He is currently advising an early-stage fashion startup making jewelry for your hair and is the author of Stoking Your Innovation Bonfire from John Wiley & Sons. He tweets from @innovate.