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Customer lifetime value by definition is simply the prediction of net profits attributed for the period of relationship that the customer has had with the firm while Customer equity is the accumulation of all customer lifetime value equal to the firms equity.
Both are financially based approaches and used to evaluate the contribution of customers to forms equity and growth in terms of value
They mutually relate , CLV makes up the customers equity, They are important in finding the most optimal values in investments and sales
CLV focuses on long term benefits to the customer out of the firm. its purpose is to assess the finacial value of each and every customer in the firm.
Continuing ............... be patient please
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Oct 7th, 2015
Both enables the firm to improve customer service and also quality of products due to loyalty assessed.
Both enables the firms management to focus on long term value of their customers and also help in analyzing the better way of customer retention
Customer equity takes into consideration factors like brand equity, value and retention equity while CLV takes into consideration the behavior of the customers
CLV is more concerned about the calculation of a customer equity while Customer equity is basically the total value attributed of being loyal and a customer in a particular business
Oct 7th, 2015
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