In this article the authors demonstrate how a customer lifetime value approach can provide a better assessment of advertising effectiveness that takes into account post purchase behaviors such as word-of-mouth. While for many advertisers word-of-mouth is viewed as an alternative to advertising, the authors show that it is possible to quantify the way in which word-of-mouth often complements and...

We extend Schmittlein et al.’s model (1987) of customer lifetime value to include satisfaction. Customer purchases are modeled as Poisson events and their rates of occurrence depend on the satisfaction of the most recent purchase encounter. Customers purchase at a higher rate when they are satisfied than when they are dissatisfied. A closed-form formula is derived for predicting total expected ...

INTRODUCTION Customer orders in international supply networks can have different importance due to e.g. various order sizes or customer values (Pardoe, Stone 2005). Thus, customer orders should be assessed and treated individually in order to distinct between more or less profitable ones, as creating superior customer value is a key element for companies' suc-This concept explicitly focuses on ...

Share of wallet is a key factor in Customer relationship management system (CRM) which is an important application of E-business. Research has found that share of wallet is an important indicator to measure customer loyalty and customer potential value. On the basis of the existent marketing literatures, this study analyzes the variables influencing share of wallet according the traits of the B...

Many companies have no reliable way to determine whether their marketing money has been spent effectively, and their return on investment is often not evaluated in a systematic manner. Thus, a compelling need exists for computational tools that help companies to optimize their marketing strategies. For this purpose, we have developed computational models of customer buying behavior in order to ...

T past few years have seen increasing interest in taking the notion of customer lifetime value (CLV) and extending it to value a customer base (with subsequent links to corporate valuation). The application of standard textbook discussions of CLV leads to calculations based on a single retention rate. However, at the cohort level, retention rates typically increase over time. It has been sugges...

This article considers the impact of relationship marketing in the casino gaming industry. It illustrates how ‘customer lifetime value’ (LTV)—the estimated profitability of a customer over the course of his or her entire relationship with a company—can be uniquely and successfully applied to improve casino profitability. Findings indicate that increasing customer retention rates for prime custo...

Acquisition modeling for direct mail insurance has the unique challenge of targeting responsive customers while minimizing risk. In addition, factors such as the probability of a paid premium and customer profitability all effect the Lifetime Value of a prospect. This presentation will detail the steps to develop a Lifetime Value, which can used to optimize the selection of prospects. Topics co...

Software-as-a-Service providers have been growing fast while the contemporary research literature has neglected analysis of their business-critical marketing and sales processes. In this paper we collect the key factors characterizing how to market and sell SaaS to business customers into an eight dimensional model. We also use an explorative multi-case study to observe six SaaS providers and v...