What is an example of customer profitability?

Customer Profitability means the profit a company earns through a customer. Customers considered to be profitable are those whose revenues exceed their costs by a satisfactory amount.

Let's take an example. You have one customer, David. The per-person cost spent on customer acquisition, serving, and selling is $20 per annum. Considering the sales generated by David, which is $25, we can say that his customer profitability is $5. Take the same example to calculate for a large group and divide the sales per customer by total sales.

So, to maximize customer profitability, you should consider optimizing your customer acquisition costs to keep them to a minimum and consider vending the online products with the highest profitability margins.