ABSTRACT
What is a portfolio? The use of the term ‘portfolio’ in customer portfolio analysis (CPA) indicates that the outcome of this process is a classification of customers into different groups that are then managed on a portfolio, or collective, basis. One of the fundamental propositions of customer relationship management (CRM) is that not all customers should be managed in the same way. This is largely because they represent different revenue and cost profiles for the company. Some customers might be offered customized product and face-to-face account management; others might be offered standardized product and web-based self-service. If the second group were to be offered the same service levels as the first, they might end up being profit-takers rather than profit-makers for the company.
