Process / pipelineCustomer value quantification and retention
Customer Lifetime Value
Customer Lifetime Value (CLV) is a financial metric that quantifies the total profit a company expects to generate from its relationship with a customer over the entire duration of that relationship. Developed through work by Blattberg, Getz, and Thomas in the 1990s-2000s, CLV integrates acquisition costs, purchase behavior, retention rates, and margin information to estimate the net present value of each customer.
Open in MethodMindSoonVideoSoon
Read the full method
Members only
Sign inSign in with a free account to read this section.
Sources
- Blattberg, R. C., Getz, G., & Thomas, J. S. (2001). Customer Equity: Building and Managing Relationships as Assets. Harvard Business School Press. ISBN: 978-0875847191
- Gupta, S., Hanssens, D., Hardie, B., Kahn, W., Kumar, V., Lin, N., ... & Sriram, S. (2006). Modeling Customer Lifetime Value. Journal of Service Research, 9(2), 139-155. DOI: 10.1177/1094670506293810 ↗
- Kumar, V., & Pansari, A. (2016). Competitive Advantage Through Engagement. Journal of Marketing Research, 53(4), 497-514. DOI: 10.1509/jmkr.15.0044 ↗