Customer Lifetime Value (CLV) is the net present value of the stream of future profits expected over the customers lifetime purchases ensuring that the appropriate discount rate is applied.

CUSTOMER RELATION MANAGEMENT

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Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]

Customer Lifetime Value (CLV) is the net present value of the stream of future profits expected over the customer’s lifetime purchases ensuring that the appropriate discount rate is applied.

A	True
B	False

Explanation:

Detailed explanation-1: -What is customer lifetime value (CLV)? Customer lifetime value is the total amount of money a customer is expected to spend with your business, or on your products, during the lifetime of an average business relationship.

Detailed explanation-2: -Customer profitability analysis is best conducted with the tools of an accounting technique called activity-based costing. Customer lifetime value describes the net present value of the stream of future profits expected over the customer’s lifetime purchases.

Detailed explanation-3: -How to calculate Customer Lifetime Value (CLV)? Customer Lifetime Value is calculated by multiplying your customers’ average purchase value, average purchase frequency, and average customer lifespan.

Detailed explanation-4: -Definition: Customer Lifetime Value or CLTV is the present value of the future cash flows or the value of business attributed to the customer during his or her entire relationship with the company.

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BACHELOR OF BUSINESS ADMINISTRATION

BUSINESS ADMINISTRATION

CUSTOMER RELATION MANAGEMENT