Trends Report

Navigating The Customer Lifetime Value Conundrum

A Decision-Making Framework For Lifetime Value Analysis

June 3rd, 2011
Srividya Sridharan, VP, Group Director
Srividya Sridharan VP, Group Director
With contributors:
Suresh Vittal , Allison Smith

Summary

Customer lifetime value (CLV), a forward-looking indicator of customer profitability, became common parlance as relationship marketing gained momentum. However, calculating CLV remains a significant iterative process within organizations and is often fraught with challenges in each step. At best, organizations arrive at close estimates based on how they choose to design the model. But the process remains expensive, error-prone, and often lacks real-world application. The effort required to prepare for and progress through model development is where customer intelligence (CI) professionals need to do the heavy lifting. To help, Forrester recommends a three-phased approach to determine lifetime value.

Want to read the full report?

Contact us to become a client

This report is available for individual purchase ($1495).

Forrester helps business and technology leaders use customer obsession to accelerate growth. That means empowering you to put the customer at the center of everything you do: your leadership strategy, and operations. Becoming a customer-obsessed organization requires change — it requires being bold. We give business and technology leaders the confidence to put bold into action, shaping and guiding how to navigate today's unprecedented change in order to succeed.