Customer Lifetime Value and Profitability

Customer Lifetime Value and Profitability

The most successful businesses are ones that recognize the value of their customer base and exploit that value most effectively.

We have a detailed discussion of the Customer Lifetime Value (CLV) metric and how it is used as the management tool to evaluate and monitor the potential and actual results of marketing campaigns.

We also explore why it’s important to understand the value of the existing customer base; how it can be segmented to give a profile of individual customer value and to quantify the value of different customer groups. When you understand how some customers/groups provide very little profitability to your business, it’s an easy step to realizing that not all customers are equal; that the different segments can be marketed to and serviced differentially to improve customer satisfaction, save the business time and money on marketing and ultimately improve your profits.