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About my assignment regarding principle of marketing? - Daniel Marajan - 11-19-2012 02:37 AM
This is the question, i just want to know ur opinion based on marketing knowledge:
Explain how a store owner might consider customer lifetime value when a dismantled customer leaves his or her store dissatisfied. Discuss with an example.
- livelyeggnog934 - 11-19-2012 02:45 AM
Customer lifetime value in theory represents exactly how much each customer is worth in monetry value. So therfore is measured by how much is spent on marketing to acquire each customer.
It can be very difficult to make accurate calculations of customer lifetime value. The specific calculation depends on the nature of the customer relationship.
If you are considering customer retention in terms of value, in the example you have given (customer leaving a store dissatisfied) the damage can be quite substantial. A customer is 9 times as likely to tell others of their negative experience than giving a recommendation after a positive experience.
Customers who do not renew are contract are another way businesses consider a loss.in customer lifetime value. Magazine subscriptions or insurance policys are examples of customer retention situations.
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