- log in
Posted by Srividya Sridharan on June 6, 2011
Relationship marketers love customer lifetime value (CLV) as a concept because it puts the customer at the core of the marketing investment decision and sneaks a peek into the future worth of the customer. But in reality, arriving at customer lifetime value is often a herculean task and the assortment of CLV approaches available doesn’t make the process any easier.
My latest research, titled “Navigating The Customer Lifetime Value Conundrum,” highlights key considerations for firms who plan to embark on the CLV journey. As a continuation of this research stream, I asked our Customer Intelligence community members what their experience with CLV was and a few interesting points emerged:
- Inclusion of intangible value. At what point is it important to account for the intangible, non-transactional value that customers are generating especially through all the emerging channel interactions such as referrals, recommendations, likes, user-generated content, etc.?
- Blurry definitions of "best" customers. Traditionally, resources are channeled toward your best customers with positive net present value (NPV). But often there is conflicting choice between investing in high-value, low-usage customers and low-value, high-usage customers. As a result, defining your "best" or "worst" customer/segment is not as obvious as a positive or negative NPV.
- Diversity of CLV users. CLV is not just the domain of marketing or customer-focused teams, but it touches other stakeholders in the organizations. How do non-marketing stakeholders such as finance teams in your organization view this metric? Is CLV as important to non-marketing stakeholders as it is to marketing?
Thanks to our Customer Intelligence community members for contributing to the CLV discussion. I’d love to hear your thoughts here or join the conversation on our community site.
Related Forrester Research
Search Forrester's Blogs
The dynamics that will shape the future in the age of the customer »
Planning for innovation and risk in the wake of Brexit »
Forrester's CX Index
Predict how actions to improve CX will affect revenue performance.
Measure the customer experiences that matter most »
- Brad Bortner (7)
- Brandon Purcell (7)
- Carlton Doty (20)
- Cinny Little (9)
- Emily Collins (20)
- Fatemeh Khatibloo (36)
- Gene Cao (19)
- James McCormick (9)
- Jennifer Belissent, Ph.D. (16)
- Joe Stanhope (35)
- Kristopher Arcand (2)
- Lori Wizdo (2)
- Marc Jacobson (1)
- Michael Barnes (9)
- Rob Brosnan (19)
- Rusty Warner (17)
- Srividya Sridharan (18)
- Tina Moffett (17)
- customer analytics (14)
- customer intelligence (11)
- Predictive analytics (7)
- Data mining (5)
- Predictive analytics / data mining (5)
- Advanced analytics (4)
- Analytics (3)
- customer insights (2)
- predictive analytics/data mining (2)
- Big Data; Advanced analytics; business intelligence (BI); analytics; Hadoop; data mining; predictive analytics; digital intelligence; customer analytics; insights platforms; insights services; insights-driven business; data management; artificial intellig (1)
- See all