After reading the section on CLV in Chapter 4, it was clear that my company purely used CLV as a statistic vs. valuing its principle of investing upfront for the longer term gains that come with customer loyalty and increased business. There was no serious interest in the back end. Is this the challenge for younger Internet firms?
To compliment the Safeway example in our text, I searched online for other examples of CLV use and found this December 2011 Wharton article assessing investments by these tech companies: Amazon’s Kindle Fire, Verizon’s FiOS, Sprint and the iPhone, and Netflix’s streaming service. What I found valuable were the perspectives from four Wharton professors on the pros and cons of CLV with each of these live business ventures. They even included mention of Netflix’s recent mishandling of its service change communication within the context of a smart business decision.
Interesting article--thanks for finding it. This quote is not wrong
ReplyDelete"CLV can apply in any setting, but applies best in a contractual arrangement," Wharton marketing professor Peter Fader says.
but it implies that CLV is especially applicable for products that have service contracts. No, that's not the point. CLV is applicable to ANY COMPANY that can build and maintain a viable customer database.
Interesting link at the bottom to an article on data mining which includes the concept of 'creeping out the customer' :)