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Categories
- Giving Voice To Values
- Decision Analysis
- Case Method
- Economics
- Business
- Business-Government Relations
- Diversity Management and Leveraging Difference
- Entrepreneurship and Innovation
- Environment and Sustainability
- Ethics
- Finance
- Accounting & Control
- Global Economies and Markets
- Leadership and Organizational Behavior
- Management Communications
- Management Science
- Marketing
- Negotiations
- Nonprofit Organizations
- Operations Management
- Pedagogy and Higher Administration
- Personal Assessment and Career Strategy
- Quantitative Analysis
- Strategy
- Technology and Innovation Management
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- Giving Voice To Values
- Decision Analysis
- Case Method
- Economics
- Business
- Business-Government Relations
- Diversity Management and Leveraging Difference
- Entrepreneurship and Innovation
- Environment and Sustainability
- Ethics
- Finance
- Accounting & Control
- Global Economies and Markets
- Leadership and Organizational Behavior
- Management Communications
- Management Science
- Marketing
- Negotiations
- Nonprofit Organizations
- Operations Management
- Pedagogy and Higher Administration
- Personal Assessment and Career Strategy
- Quantitative Analysis
- Strategy
- Technology and Innovation Management
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About Us
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Customer Lifetime Value
Pfeifer, Phillip E.;
Farris, Paul W.;
Bendle, Neil
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Overview
This technical note introduces important metrics firms use to monitor customer relationships. An important summary of customer activity is the profit the firm receives from each customer. Customer profit (CP) is the metric that summarizes the past financial performance of a customer relationship and is covered in a companion note, "Customer Profit" (UVA-M-0799). The central difference between CP and customer lifetime value (CLV) is that CP measures the past and CLV looks forward. This note addresses the forward-looking metric that attempts to put a dollar value on a customer relationship. This technical note is an excerpt of the more comprehensive treatment of customer metrics found in "Customer Profitability" (UVA-M-0718).
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Learning Objectives