Customer Lifetime Value: Empirical Generalizations and Some Conceptual Questions

From the extant literature on customer Lifetime Value (CLV), We identify four empirical generalizations (well-defined, consistent effects found by at least three different sets of authors): customer satisfaction, marketing efforts, cross-buying and multichannel purchasing all have positive relationships with CLV. The frequency and monetary value of previous purchases generally have a positive effect on CLV although there are some contradictory findings in this regard. We identify additional issues that have received limited attention in the literature, but require further empirical study: the effects of pricing, earned rewards and promotions on CLV managing a sequence of contacts to maximize response rates and CLV, and whether CLV can be forecasted sufficiently accurately. We also discuss additional conceptual issues that merit further research. (C) 2009 Direct Marketing Educational Foundation, Inc. Published by Elsevier B.V. All rights reserved.