Measuring Risk-adjusted Customer Lifetime Value and its Impact on Relationship Marketing Strategies and Shareholder Value

Date published

2005-01-01T00:00:00Z

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Publisher

Emerald Group Publishing Limited

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Article

ISSN

0309-0566

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Citation

Lynette Ryals and Simon Knox, Measuring Risk-adjusted Customer Lifetime Value and its Impact on Relationship Marketing Strategies and Shareholder Value. European Journal of Marketing, 2005, Volume 39, Issue 5/6, pp456-472

Abstract

The calculations which underlie efforts to balance marketing spending on customer acquisition and customer retention are usually based on either single- period customer profitability or forecasts of customer lifetime value (CLTV). This paper argues instead for risk-adjusted CLTV, which is termed the economic value (EV) of a customer, as the means for marketing to assess both customer profitability and shareholder value gains.

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Github

Keywords

Customers, Relationship marketing, Shareholders, Value analysis

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Relationships

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