What Are Your Customers Worth?
- Topics:
- Marketing Strategy
- Tags:
- CMP Media,
- Customer,
- Lifetime,
- Management,
- Marketing,
- Marketing Research,
- Sales,
- Sales Strategy,
- Strategy
- Source:
- CMP Media
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Overview: Most senior executives say their companies should be customer-focused. Yet in times like these, when budgets are tight, some of the first expenditures to be cut are for marketing and IT, both of which are supposed to help companies better understand and serve customers. The lifetime value of a customer is the present value of all future profits generated from that customer. Lifetime value differs from the traditional present-value or discounted-cash-flow approach by focusing on individual customers and recognizing that customers do not stay with a company forever. It, therefore, accounts for customer retention and defection. The article lists steps a company should take to implement customer lifetime value as a corporate mandate throughout customer service, finance, IT, sales, marketing, and other departments.
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Format: HTML | Date: May 2002 | Pages: 4
