Add-on Selling Accounting Measures

Successful add-on selling generally manifests itself through changes in sales to retained customers. However, as measures, changes in sales and profits to retained customers have the same problem that the unadjusted retention rate has. Specifically, these figures reflect the number of long- and short-life customers in the firm's database. We begin this section by showing how to adjust average sales and profit measures. We show how to compute changes in sales and profits to retained customers using the duration adjusted figures. Finally we explore how inferences drawn from traditional change in sales or profit measures can differ from those inferences drawn from duration-adjusted measures.

Duration-Adjusted Average Sales and Profits per Retained Customer
Change in Sales and Profits for Retained Customers