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Marketers have been throwing around terms such as CLV, LTV, and a variety of other labels for customer valuation for several decades now. But besides a few notable applications it has been mostly “cheap talk” – either an unfulfilled aspiration on the part of managers, or a "quick and dirty" analysis, lacking proper validation, that is used by a small group within the firm but fails to get traction across the organization.
Fortunately, these frustrating days are ending: customer valuation is finally coming to the forefront and it is here to stay. A variety of factors are driving this change, including better customer-level data (far more timely, complete, and accurate than ever before); better computing and IT skills (enabling a broader set of managers to build and use these models), and a stronger competitive imperative (as more firms shift from product- to customer-centric thinking). In this talk we will discuss this important trend, its implications for executives, and cover a few recent examples of companies (both B2B and B2C) that have used customer valuation in surprising ways and with compelling results.
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