CUSTOMER LIFE TIME VALUE
• Customer lifetime value (CLV), lifetime customer value (LCV), or lifetime value (LTV) is the net present value of the cash flows attributed to the relationship with a customer.
• The use of customer lifetime value as a marketing metric tends to place greater emphasis on customer service and long-term customer satisfaction, rather than on maximizing short-term sales.
• Building Profitable Customer-Centric Strategies: Maximizing Profit Potential
• Our high-impact processes for becoming more customer-centric and creating innovative strategies will be valuable only if we can effectively deliver on these profitably.
SELECTION OF PROFITABLE CUSTOMER PROFITABILITY
• We first understand the key factors that will drive profitability for customer insight initiatives.
• During the innovation stage, the objective was to creatively generate new sources for capturing intelligence from customers and creating insight that could enhance the way we communicate and sell to customers.
• As you learn more from customers about their needs and preferences, you have the opportunity to better target your marketing messages, offers and channels, which ultimately leads to reduced marketing expenses and increased conversion rates.
• Customer life time value
The key factors that will drive the profitability of customer insight initiatives include these:
• Reaching high-value customers and prospects
• Capturing intelligence on a critical mass of customers to justify the fixed costs of setting up and managing the program
• Generating incremental profits from increased sales to new customers, higher customer retention, selling more to existing customers or winning back lost customers
• Reducing costs of delivering solutions and servicing customers
• Capturing intelligence cost-effectively
• Building the ability to influence customer profitability over time