SlideShare a Scribd company logo
By Group6
 Jatin Chhillar (40721104)
 Shashank Pandey (40721192)
Delhi Skill and Entrepreneurship University
1
TABLEOF
CONTENT
 1. Customer Lifetime Value
 2. About UN Broadband
 3. CLV Calculation Method
 4. Improving CLV
 5. Some applications of CLV
 6. CLV Reliability
 7. CLV Difficulties
2
Delhi Skill and Entrepreneurship University
CUSTOMER LIFETIME VALUE
Customer Lifetime Value is an important metric for measuring where your business is right now
and forecasting future profits because it demonstrates how long a customer is expected to keep
purchasing from you and how much money they are expected to spend during that time.
Customer lifetime value is a customer's total net profit to a company over their life.
The concept of lifetime value may be applied to customers in many ways, such as: examining
the customer purchase history, forecasting future interactions with the business or considering
customer referral values.
3
Delhi Skill and Entrepreneurship University
The lifetime value can be enhanced by increasing the number of transactions per year and
increasing customer retention rates.
Let us start by considering a simple description of lifetime value in terms of revenue. The person
who has purchased four cars from a car dealer over the past ten years with an average cost of Rs.
4,00,000 may be viewed as a Rs. 16,00,000 per customer. However, more relevant is the fact that
this customer, if retained over the rest of their car purchasing life of 25 years, may buy ten more
cars. If they cost the same amount this represents Rs. 40,00,000 in terms of lifetime revenue.
4
Delhi Skill and Entrepreneurship University
ABOUT UN BROADBAND:
UN Broadband is an Internet Service Provider in East-Haryana with more than 20k+ household
users and 2k+ industrial users. It is known to provide top service in the following categories:
Internet Service Providers, Wi-Fi Internet Service Providers, Broadband Internet Service Providers.
Over the course of its journey, this business has established a firm foothold in its industry. The
belief that customer satisfaction is as important as their products and services, have helped this
establishment garner a vast base of customers, which continues to grow by the day. In the near
future, this business aims to expand its line of products and services and cater to a larger client
base.
5
Delhi Skill and Entrepreneurship University
MAJOR FINDINGS
6
Delhi Skill and Entrepreneurship University
HOW THEY CALCULATE CLV?
By analyzing cohorts, we can predict CLV. Customer cohorts are groups of clients who made
their first purchase in the same month and have similar characteristics. The average
revenue is calculated for each cohort, rather than for each individual. By analyzing cohorts,
you can also figure out how many loyal clients you have, locate the points where purchases
drop off, and accurately evaluate ad campaigns.
On the basis of 3 months data, they are guessing how long customers will stay with them.
Depending on business strategy and industry, we should adjust the CLTV (or CLV) formula
for a more accurate result.
7
Delhi Skill and Entrepreneurship University
IMPROVING CLV
 Launch a loyalty program: It's possible to earn points through a variety of methods, such as
client cards and mobile applications.
 Improve your customer experience: All touchpoints with customers (online and offline
stores, support centers, social networks, etc.) should be monitored continuously.
 Work with disappointed customers: Work through customer objections and offer
alternatives to prevent potential customer dissatisfaction.
 Cross Selling and Up-Selling: When organizations model their potential future profit, they
need to take into account the fact that individual consumers may be persuaded to buy other
products – cross-selling, or more of an existing product over time – upselling.
8
Delhi Skill and Entrepreneurship University
APPLICATIONS OF CLV
• Conversion of customers: It's important for businesses to know how much money
customers spend with them over time - whether it's Rs. 50k, Rs. 500k, or Rs. 5000k.
• Improve forecasting: The CLV calculation can help you predict future needs for your
product or service. When you have this information at hand, you can make informed
decisions about your workforce, inventory, or other resources.
• Development of new products: The product team may not be focused on revenue goals
on a daily basis, but strategic decisions about how engineering resources are spent should
be based on business impact. Customers' lifetime value can inform the design of a product
based on what customer segment it should target.
9
Delhi Skill and Entrepreneurship University
CLV RELIABILITY
Even with flawless data, statistical models of CLVs can never provide precise predictions.
However, a model such as this can serve your needs if you take a reasonable amount of care.
The figure doesn't have to be exact. It is helpful to be able to compare the advantages of
marketing programs and sales strategies. Providing usable information is what you need. This
type of analysis may help you identify areas for improvement in your business or marketing
strategy and make changes that will improve your ability to predict future revenues from
customers who are most likely to return and to spend more money on your products or
services over time.
10
Delhi Skill and Entrepreneurship University
DIFFICULTIES WHILE CALCULATING CLV
• Churn Rate: The cause of customer churn is complicated, and many factors combine to cause a
customer to leave your business. Build an amazing shopping experience for your customers so
that they stay with you.
• Discount Rates: As internet and technology are the dynamic sectors, thus it becomes difficult to
have a consistent discount rate. When there arises more competition even a higher discount rate
of 15% to 20% right be appropriate, as it will reflect the uncertainty going forward.
• Fail to take into account customer acquisition costs: Customer Acquisition Cost is something
that changes periodically due to various reasons like number of sellers. Hence, it becomes
difficult to take the precise customer acquisition cost.
11
Delhi Skill and Entrepreneurship University
Thank you
12
Delhi Skill and Entrepreneurship University

More Related Content

Similar to Customer Lifetime Value Presentation.pptx

How to Effectively Measure the ROI of Customer Onboarding.pdf
How to Effectively Measure the ROI of Customer Onboarding.pdfHow to Effectively Measure the ROI of Customer Onboarding.pdf
How to Effectively Measure the ROI of Customer Onboarding.pdf
deepakonslideofshare
 
Case Competition Document
Case Competition DocumentCase Competition Document
Case Competition Document
Meghan Sowersby
 
How customer retention makes your business invincible.pdf
How customer retention makes your business invincible.pdfHow customer retention makes your business invincible.pdf
How customer retention makes your business invincible.pdf
WebMaxy
 
Learn about consumer intelligence to enhance consumer experience
Learn about consumer intelligence to enhance consumer experience Learn about consumer intelligence to enhance consumer experience
Learn about consumer intelligence to enhance consumer experience
Jaiveer Singh
 
Customer Loyalty In Retail Sector
Customer Loyalty In Retail SectorCustomer Loyalty In Retail Sector
Customer Loyalty In Retail Sector
Tracy Clark
 
The Brand Of Brand Loyalty
The Brand Of Brand LoyaltyThe Brand Of Brand Loyalty
The Brand Of Brand Loyalty
Carmen Martin
 
How to guide - calculating clv (sample)
How to guide - calculating clv (sample)How to guide - calculating clv (sample)
How to guide - calculating clv (sample)
Jesse Hopps
 
Assignment b2 b marketing
Assignment   b2 b marketingAssignment   b2 b marketing
Assignment b2 b marketing
shailesh matkar
 
Becoming a Customer-Driven Organization
Becoming a Customer-Driven OrganizationBecoming a Customer-Driven Organization
Becoming a Customer-Driven Organization
Strata Company
 
Digital Customer Service
Digital Customer ServiceDigital Customer Service
Digital Customer Service
Operational Excellence Consulting
 
2bodyofdissertation 131104105101-phpapp01
2bodyofdissertation 131104105101-phpapp012bodyofdissertation 131104105101-phpapp01
2bodyofdissertation 131104105101-phpapp01
Amanlal Tapase
 
Patient Loyalty: What it Takes to Earn Their Loyalty
Patient Loyalty: What it Takes to Earn Their Loyalty Patient Loyalty: What it Takes to Earn Their Loyalty
Patient Loyalty: What it Takes to Earn Their Loyalty
Sallie Burnett
 
inQuba: The Science of Retaining Customers in Financial Services [US Webinar]
inQuba: The Science of Retaining Customers in Financial Services [US Webinar] inQuba: The Science of Retaining Customers in Financial Services [US Webinar]
inQuba: The Science of Retaining Customers in Financial Services [US Webinar]
Antony Adelaar
 
Veryday Future CXpectations whitepaper
Veryday Future CXpectations whitepaperVeryday Future CXpectations whitepaper
Veryday Future CXpectations whitepaper
Stefan Moritz
 
CHAPTER-2-Customer-Service-and-Customer-Reltionship-.docx.pptx
CHAPTER-2-Customer-Service-and-Customer-Reltionship-.docx.pptxCHAPTER-2-Customer-Service-and-Customer-Reltionship-.docx.pptx
CHAPTER-2-Customer-Service-and-Customer-Reltionship-.docx.pptx
ivanjoedl
 
Customer satisfaction on Hero Motocop Ltd after split with Honda
Customer satisfaction on Hero Motocop Ltd after split with Honda  Customer satisfaction on Hero Motocop Ltd after split with Honda
Customer satisfaction on Hero Motocop Ltd after split with Honda
KPMG
 
principlesofmarketing-chapter2-1708101623343.pptx
principlesofmarketing-chapter2-1708101623343.pptxprinciplesofmarketing-chapter2-1708101623343.pptx
principlesofmarketing-chapter2-1708101623343.pptx
cjoypingaron
 
Winning Customer Retention Strategies to Keep Customers Coming Back
Winning Customer Retention Strategies to Keep Customers Coming BackWinning Customer Retention Strategies to Keep Customers Coming Back
Winning Customer Retention Strategies to Keep Customers Coming Back
Cyntexa
 
Winning Customer Retention Strategies to Keep Customers Coming Back
Winning Customer Retention Strategies to Keep Customers Coming BackWinning Customer Retention Strategies to Keep Customers Coming Back
Winning Customer Retention Strategies to Keep Customers Coming Back
Cyntexa
 
Best Customer Retention Tactics.pdf
Best Customer Retention Tactics.pdfBest Customer Retention Tactics.pdf
Best Customer Retention Tactics.pdf
CXcherryInternship
 

Similar to Customer Lifetime Value Presentation.pptx (20)

How to Effectively Measure the ROI of Customer Onboarding.pdf
How to Effectively Measure the ROI of Customer Onboarding.pdfHow to Effectively Measure the ROI of Customer Onboarding.pdf
How to Effectively Measure the ROI of Customer Onboarding.pdf
 
Case Competition Document
Case Competition DocumentCase Competition Document
Case Competition Document
 
How customer retention makes your business invincible.pdf
How customer retention makes your business invincible.pdfHow customer retention makes your business invincible.pdf
How customer retention makes your business invincible.pdf
 
Learn about consumer intelligence to enhance consumer experience
Learn about consumer intelligence to enhance consumer experience Learn about consumer intelligence to enhance consumer experience
Learn about consumer intelligence to enhance consumer experience
 
Customer Loyalty In Retail Sector
Customer Loyalty In Retail SectorCustomer Loyalty In Retail Sector
Customer Loyalty In Retail Sector
 
The Brand Of Brand Loyalty
The Brand Of Brand LoyaltyThe Brand Of Brand Loyalty
The Brand Of Brand Loyalty
 
How to guide - calculating clv (sample)
How to guide - calculating clv (sample)How to guide - calculating clv (sample)
How to guide - calculating clv (sample)
 
Assignment b2 b marketing
Assignment   b2 b marketingAssignment   b2 b marketing
Assignment b2 b marketing
 
Becoming a Customer-Driven Organization
Becoming a Customer-Driven OrganizationBecoming a Customer-Driven Organization
Becoming a Customer-Driven Organization
 
Digital Customer Service
Digital Customer ServiceDigital Customer Service
Digital Customer Service
 
2bodyofdissertation 131104105101-phpapp01
2bodyofdissertation 131104105101-phpapp012bodyofdissertation 131104105101-phpapp01
2bodyofdissertation 131104105101-phpapp01
 
Patient Loyalty: What it Takes to Earn Their Loyalty
Patient Loyalty: What it Takes to Earn Their Loyalty Patient Loyalty: What it Takes to Earn Their Loyalty
Patient Loyalty: What it Takes to Earn Their Loyalty
 
inQuba: The Science of Retaining Customers in Financial Services [US Webinar]
inQuba: The Science of Retaining Customers in Financial Services [US Webinar] inQuba: The Science of Retaining Customers in Financial Services [US Webinar]
inQuba: The Science of Retaining Customers in Financial Services [US Webinar]
 
Veryday Future CXpectations whitepaper
Veryday Future CXpectations whitepaperVeryday Future CXpectations whitepaper
Veryday Future CXpectations whitepaper
 
CHAPTER-2-Customer-Service-and-Customer-Reltionship-.docx.pptx
CHAPTER-2-Customer-Service-and-Customer-Reltionship-.docx.pptxCHAPTER-2-Customer-Service-and-Customer-Reltionship-.docx.pptx
CHAPTER-2-Customer-Service-and-Customer-Reltionship-.docx.pptx
 
Customer satisfaction on Hero Motocop Ltd after split with Honda
Customer satisfaction on Hero Motocop Ltd after split with Honda  Customer satisfaction on Hero Motocop Ltd after split with Honda
Customer satisfaction on Hero Motocop Ltd after split with Honda
 
principlesofmarketing-chapter2-1708101623343.pptx
principlesofmarketing-chapter2-1708101623343.pptxprinciplesofmarketing-chapter2-1708101623343.pptx
principlesofmarketing-chapter2-1708101623343.pptx
 
Winning Customer Retention Strategies to Keep Customers Coming Back
Winning Customer Retention Strategies to Keep Customers Coming BackWinning Customer Retention Strategies to Keep Customers Coming Back
Winning Customer Retention Strategies to Keep Customers Coming Back
 
Winning Customer Retention Strategies to Keep Customers Coming Back
Winning Customer Retention Strategies to Keep Customers Coming BackWinning Customer Retention Strategies to Keep Customers Coming Back
Winning Customer Retention Strategies to Keep Customers Coming Back
 
Best Customer Retention Tactics.pdf
Best Customer Retention Tactics.pdfBest Customer Retention Tactics.pdf
Best Customer Retention Tactics.pdf
 

Recently uploaded

development men lap tok mhlcf;k,hhg, jx,dthu;yli7b. pptx
development men lap tok mhlcf;k,hhg, jx,dthu;yli7b. pptxdevelopment men lap tok mhlcf;k,hhg, jx,dthu;yli7b. pptx
development men lap tok mhlcf;k,hhg, jx,dthu;yli7b. pptx
namansingla546
 
420 for sale near me Telegram @pplanet0 weed for sale in UAE
420 for sale near me Telegram @pplanet0 weed for sale in UAE420 for sale near me Telegram @pplanet0 weed for sale in UAE
420 for sale near me Telegram @pplanet0 weed for sale in UAE
ausway566
 
BDSM Girls Call Navi Mumbai 🛵🚡9920725232 💃 Choose Best And Top Girl Service A...
BDSM Girls Call Navi Mumbai 🛵🚡9920725232 💃 Choose Best And Top Girl Service A...BDSM Girls Call Navi Mumbai 🛵🚡9920725232 💃 Choose Best And Top Girl Service A...
BDSM Girls Call Navi Mumbai 🛵🚡9920725232 💃 Choose Best And Top Girl Service A...
6459astrid
 
UCL biyezheng degree offer diploma Transcript
UCL biyezheng degree offer diploma TranscriptUCL biyezheng degree offer diploma Transcript
UCL biyezheng degree offer diploma Transcript
aaxweek
 
Hyderabad Girls call 👀 XXXXXXXXXXX 👀 Cash Payment With Room DeliveryDelivery
Hyderabad Girls call  👀 XXXXXXXXXXX 👀 Cash Payment With Room DeliveryDeliveryHyderabad Girls call  👀 XXXXXXXXXXX 👀 Cash Payment With Room DeliveryDelivery
Hyderabad Girls call 👀 XXXXXXXXXXX 👀 Cash Payment With Room DeliveryDelivery
Jasmine Rawat
 
Busty Girls Call Navi Mumbai 🛵🚡9820252231 💃 Choose Best And Top Girl Service ...
Busty Girls Call Navi Mumbai 🛵🚡9820252231 💃 Choose Best And Top Girl Service ...Busty Girls Call Navi Mumbai 🛵🚡9820252231 💃 Choose Best And Top Girl Service ...
Busty Girls Call Navi Mumbai 🛵🚡9820252231 💃 Choose Best And Top Girl Service ...
902basic
 
SFU degree offer diploma Transcript
SFU degree offer diploma TranscriptSFU degree offer diploma Transcript
SFU degree offer diploma Transcript
oymwthh
 
Buy Two Wheeler Insurance at Best Price in India | MyPolicyExpess
Buy Two Wheeler Insurance at Best Price in India | MyPolicyExpessBuy Two Wheeler Insurance at Best Price in India | MyPolicyExpess
Buy Two Wheeler Insurance at Best Price in India | MyPolicyExpess
R&D Insurance Brokers Private Limited
 
Girls Call Andheri East 9910780858 Provide Best And Top Girl Service And No1 ...
Girls Call Andheri East 9910780858 Provide Best And Top Girl Service And No1 ...Girls Call Andheri East 9910780858 Provide Best And Top Girl Service And No1 ...
Girls Call Andheri East 9910780858 Provide Best And Top Girl Service And No1 ...
margaretblush
 
Girls Call ServiCe Hyderabad 0000000000 Tanisha Best High Class Hyderabad Ava...
Girls Call ServiCe Hyderabad 0000000000 Tanisha Best High Class Hyderabad Ava...Girls Call ServiCe Hyderabad 0000000000 Tanisha Best High Class Hyderabad Ava...
Girls Call ServiCe Hyderabad 0000000000 Tanisha Best High Class Hyderabad Ava...
aslasdfmkhan4750
 

Recently uploaded (10)

development men lap tok mhlcf;k,hhg, jx,dthu;yli7b. pptx
development men lap tok mhlcf;k,hhg, jx,dthu;yli7b. pptxdevelopment men lap tok mhlcf;k,hhg, jx,dthu;yli7b. pptx
development men lap tok mhlcf;k,hhg, jx,dthu;yli7b. pptx
 
420 for sale near me Telegram @pplanet0 weed for sale in UAE
420 for sale near me Telegram @pplanet0 weed for sale in UAE420 for sale near me Telegram @pplanet0 weed for sale in UAE
420 for sale near me Telegram @pplanet0 weed for sale in UAE
 
BDSM Girls Call Navi Mumbai 🛵🚡9920725232 💃 Choose Best And Top Girl Service A...
BDSM Girls Call Navi Mumbai 🛵🚡9920725232 💃 Choose Best And Top Girl Service A...BDSM Girls Call Navi Mumbai 🛵🚡9920725232 💃 Choose Best And Top Girl Service A...
BDSM Girls Call Navi Mumbai 🛵🚡9920725232 💃 Choose Best And Top Girl Service A...
 
UCL biyezheng degree offer diploma Transcript
UCL biyezheng degree offer diploma TranscriptUCL biyezheng degree offer diploma Transcript
UCL biyezheng degree offer diploma Transcript
 
Hyderabad Girls call 👀 XXXXXXXXXXX 👀 Cash Payment With Room DeliveryDelivery
Hyderabad Girls call  👀 XXXXXXXXXXX 👀 Cash Payment With Room DeliveryDeliveryHyderabad Girls call  👀 XXXXXXXXXXX 👀 Cash Payment With Room DeliveryDelivery
Hyderabad Girls call 👀 XXXXXXXXXXX 👀 Cash Payment With Room DeliveryDelivery
 
Busty Girls Call Navi Mumbai 🛵🚡9820252231 💃 Choose Best And Top Girl Service ...
Busty Girls Call Navi Mumbai 🛵🚡9820252231 💃 Choose Best And Top Girl Service ...Busty Girls Call Navi Mumbai 🛵🚡9820252231 💃 Choose Best And Top Girl Service ...
Busty Girls Call Navi Mumbai 🛵🚡9820252231 💃 Choose Best And Top Girl Service ...
 
SFU degree offer diploma Transcript
SFU degree offer diploma TranscriptSFU degree offer diploma Transcript
SFU degree offer diploma Transcript
 
Buy Two Wheeler Insurance at Best Price in India | MyPolicyExpess
Buy Two Wheeler Insurance at Best Price in India | MyPolicyExpessBuy Two Wheeler Insurance at Best Price in India | MyPolicyExpess
Buy Two Wheeler Insurance at Best Price in India | MyPolicyExpess
 
Girls Call Andheri East 9910780858 Provide Best And Top Girl Service And No1 ...
Girls Call Andheri East 9910780858 Provide Best And Top Girl Service And No1 ...Girls Call Andheri East 9910780858 Provide Best And Top Girl Service And No1 ...
Girls Call Andheri East 9910780858 Provide Best And Top Girl Service And No1 ...
 
Girls Call ServiCe Hyderabad 0000000000 Tanisha Best High Class Hyderabad Ava...
Girls Call ServiCe Hyderabad 0000000000 Tanisha Best High Class Hyderabad Ava...Girls Call ServiCe Hyderabad 0000000000 Tanisha Best High Class Hyderabad Ava...
Girls Call ServiCe Hyderabad 0000000000 Tanisha Best High Class Hyderabad Ava...
 

Customer Lifetime Value Presentation.pptx

  • 1. By Group6  Jatin Chhillar (40721104)  Shashank Pandey (40721192) Delhi Skill and Entrepreneurship University 1
  • 2. TABLEOF CONTENT  1. Customer Lifetime Value  2. About UN Broadband  3. CLV Calculation Method  4. Improving CLV  5. Some applications of CLV  6. CLV Reliability  7. CLV Difficulties 2 Delhi Skill and Entrepreneurship University
  • 3. CUSTOMER LIFETIME VALUE Customer Lifetime Value is an important metric for measuring where your business is right now and forecasting future profits because it demonstrates how long a customer is expected to keep purchasing from you and how much money they are expected to spend during that time. Customer lifetime value is a customer's total net profit to a company over their life. The concept of lifetime value may be applied to customers in many ways, such as: examining the customer purchase history, forecasting future interactions with the business or considering customer referral values. 3 Delhi Skill and Entrepreneurship University
  • 4. The lifetime value can be enhanced by increasing the number of transactions per year and increasing customer retention rates. Let us start by considering a simple description of lifetime value in terms of revenue. The person who has purchased four cars from a car dealer over the past ten years with an average cost of Rs. 4,00,000 may be viewed as a Rs. 16,00,000 per customer. However, more relevant is the fact that this customer, if retained over the rest of their car purchasing life of 25 years, may buy ten more cars. If they cost the same amount this represents Rs. 40,00,000 in terms of lifetime revenue. 4 Delhi Skill and Entrepreneurship University
  • 5. ABOUT UN BROADBAND: UN Broadband is an Internet Service Provider in East-Haryana with more than 20k+ household users and 2k+ industrial users. It is known to provide top service in the following categories: Internet Service Providers, Wi-Fi Internet Service Providers, Broadband Internet Service Providers. Over the course of its journey, this business has established a firm foothold in its industry. The belief that customer satisfaction is as important as their products and services, have helped this establishment garner a vast base of customers, which continues to grow by the day. In the near future, this business aims to expand its line of products and services and cater to a larger client base. 5 Delhi Skill and Entrepreneurship University
  • 6. MAJOR FINDINGS 6 Delhi Skill and Entrepreneurship University
  • 7. HOW THEY CALCULATE CLV? By analyzing cohorts, we can predict CLV. Customer cohorts are groups of clients who made their first purchase in the same month and have similar characteristics. The average revenue is calculated for each cohort, rather than for each individual. By analyzing cohorts, you can also figure out how many loyal clients you have, locate the points where purchases drop off, and accurately evaluate ad campaigns. On the basis of 3 months data, they are guessing how long customers will stay with them. Depending on business strategy and industry, we should adjust the CLTV (or CLV) formula for a more accurate result. 7 Delhi Skill and Entrepreneurship University
  • 8. IMPROVING CLV  Launch a loyalty program: It's possible to earn points through a variety of methods, such as client cards and mobile applications.  Improve your customer experience: All touchpoints with customers (online and offline stores, support centers, social networks, etc.) should be monitored continuously.  Work with disappointed customers: Work through customer objections and offer alternatives to prevent potential customer dissatisfaction.  Cross Selling and Up-Selling: When organizations model their potential future profit, they need to take into account the fact that individual consumers may be persuaded to buy other products – cross-selling, or more of an existing product over time – upselling. 8 Delhi Skill and Entrepreneurship University
  • 9. APPLICATIONS OF CLV • Conversion of customers: It's important for businesses to know how much money customers spend with them over time - whether it's Rs. 50k, Rs. 500k, or Rs. 5000k. • Improve forecasting: The CLV calculation can help you predict future needs for your product or service. When you have this information at hand, you can make informed decisions about your workforce, inventory, or other resources. • Development of new products: The product team may not be focused on revenue goals on a daily basis, but strategic decisions about how engineering resources are spent should be based on business impact. Customers' lifetime value can inform the design of a product based on what customer segment it should target. 9 Delhi Skill and Entrepreneurship University
  • 10. CLV RELIABILITY Even with flawless data, statistical models of CLVs can never provide precise predictions. However, a model such as this can serve your needs if you take a reasonable amount of care. The figure doesn't have to be exact. It is helpful to be able to compare the advantages of marketing programs and sales strategies. Providing usable information is what you need. This type of analysis may help you identify areas for improvement in your business or marketing strategy and make changes that will improve your ability to predict future revenues from customers who are most likely to return and to spend more money on your products or services over time. 10 Delhi Skill and Entrepreneurship University
  • 11. DIFFICULTIES WHILE CALCULATING CLV • Churn Rate: The cause of customer churn is complicated, and many factors combine to cause a customer to leave your business. Build an amazing shopping experience for your customers so that they stay with you. • Discount Rates: As internet and technology are the dynamic sectors, thus it becomes difficult to have a consistent discount rate. When there arises more competition even a higher discount rate of 15% to 20% right be appropriate, as it will reflect the uncertainty going forward. • Fail to take into account customer acquisition costs: Customer Acquisition Cost is something that changes periodically due to various reasons like number of sellers. Hence, it becomes difficult to take the precise customer acquisition cost. 11 Delhi Skill and Entrepreneurship University
  • 12. Thank you 12 Delhi Skill and Entrepreneurship University