Many marketers are unable to determine how long a customer can stay with them. This can be simply determined using the net present value (NPV). The net present value can be determined using the net cash flow, discount rate, and life time of the customer in the marketers’ place.
Customer lifetime value or CLV is a tool to determine the relationship with the customers. This helps the company in making decision on production, marketing, sales, and customer support.
To determine: The customer lifetime value.
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