Customer lifetime value research in marketing: A review and future directions

Jain, Dipak C.; Singh, Siddhartha

doi:10.1002/dir.10032

Cited by 428 publications

(317 citation statements)

References 9 publications

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“…Basically, it is the total amount of net profi t that a customer contributes to the company during his or her tenure with the company as an active customer. 27,28 As Jain and Singh 29 have pointed out, there are several defi nitions of CLTV and that all of them have limitations. They suggest that CLTV models can be more robust, simple and easy to understand.…”

Section: Research Methodology and Hypothesesmentioning

confidence: 99%

Getting what you paid for: Fighting wireless customer churn with rate plan optimization

Wong

2011

J Database Mark Cust Strategy Manag

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The wireless telecommunication industry is highly competitive and managing customer churn is of great concern to wireless carriers as the market matures. Recent research has indicated that wireless rate plans are complicated and confusing to customers, and that wireless carriers are taking advantage of the situation by charging a very expensive per-minute rate for voice minutes beyond the monthly usage allowance. This article revisits an emerging database marketing strategy known as rate plan optimization and explores the importance of having customers on suitable rate plans. After conducting research on 11 525 residential customers from a Canadian wireless carrier, it is discovered that 55.4 per cent of them are subscribing to the wrong rate plans and these customers are churning faster than those with optimal ones. This article argues that proactively matching customers to optimal rate plans can contribute to customer churn reduction, although short-term profi tability has to be sacrifi ced by the carriers in order to realize these benefi ts.

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Section: Research Methodology and Hypothesesmentioning

confidence: 99%

Getting what you paid for: Fighting wireless customer churn with rate plan optimization

Wong

2011

J Database Mark Cust Strategy Manag

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“…Following this new paradigm, many firms have focused on customer retention, which should be strongly linked to lifetime customer value (the expected net present value of future cash flows of the customer). Therefore, enterprises should not try to retain all current customers regardless of their contribution to company's profits [Gupta, Lehmann, 2003;Jain, Singh, 2002;Malthouse, Blattberg, 2004;Thomas, Reinartz, Kumar, 2004] and efforts to retain unprofitable customer should be eliminated [Thomas et al, 2004].…”

Section: Customer Retentionmentioning

confidence: 99%

An Analytic Hierarchy Process Analysis: Application to Subscriber Retention Decisions in the Nigerian Mobile Telecommunications

Adebiyi

Oyatoye

Kuye

2015

International Journal of Management and Economics

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The introduction of mobile number portability (MNP) in the Nigerian telecommunications industry has brought a new challenge for mobile operators. This study investigates the use of Analytic Hierarchy Process (AHP) in customer retention decisions in the Nigerian telecommunication industry using a cross-sectional survey design. Primary data were obtained through questionnaires administered to 480 mobile telecommunications subscribers in six tertiary institutions located in Lagos State, Nigeria. These educational institutions were chosen using a multistage sampling technique. Of 438 questionnaires received from subscribers, 408 were valid. Based on this sample data an AHP model was built to assess the determinants of customer retention decisions. Next, eigen values, an eigen vector and maximum lambda (λ Max ) were obtained using the AHP analysis for the matrices. This analysis shows that customers considered call quality as the important in the retention decision. We conclude that AHP is a meaningful tool for determining

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“…A basic tenet of the evaluation of marketing strategy is that marketing efforts should be referred to the customer lifetime value (Rust et al, 2000;Blattberg et al, 2001;Jain & Singh, 2002). Hence, the allocation of marketing resources should focus on the enhancement of the expected customer lifetime value.…”

Section: Customer Lifetime Value (Clv)mentioning

confidence: 99%

Managing Rewards to Enhance Customer Lifetime Value

Kristiani¹,

Sumarwan²,

Yuliati³

et al. 2013

ASS

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The goal of loyalty reward program is to retain customers who are profitable to the organization. However most airlines have very little understanding of their customers yet have a little knowledge about their most valuable passengers. This study is aimed to analyze financial aspects of customer value to the company in the context of aviation loyalty reward program in Indonesia. Financial value of customers is analyzed using CLV approach. Modeling of financial value of the members to the airline is developed by performing regression analysis of CLV against RFM and the associated socio-demographic characteristics of the members. This study used secondary data of customer profiles and financial transactions of the Garuda Frequent Flyer members in 2012. The empirical findings observed in this study explain that the financial value of the frequent flyer members to the airline is influenced by RFM, Gender, Age, and Frequent Flyer Tier levels. It is also found that the RFM valuation is aligned with CLV analysis. The result contributes to the knowledge of aviation loyalty program by improving the effectiveness from the aspect of capitalizing on the lifetime value of the members, and to the industry in designing proper marketing strategy and implementing accurate marketing functions in term of Frequent Flyer Program.

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Customer lifetime value research in marketing: A review and future directions

Cited by 428 publications

References 9 publications

Getting what you paid for: Fighting wireless customer churn with rate plan optimization

Getting what you paid for: Fighting wireless customer churn with rate plan optimization

An Analytic Hierarchy Process Analysis: Application to Subscriber Retention Decisions in the Nigerian Mobile Telecommunications

Managing Rewards to Enhance Customer Lifetime Value

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