Which of the following statements about the lifetime value of a customer is true?
A) CRM helps companies identify their customers' lifetime value.
B) All customers have the same lifetime value.
C) A customer's lifetime value is easy to calculate.
D) A company can either increase customer share or a customer's lifetime value, but not both.
E) The value of the customer is related to the value of the brand.

Question

Quizplus · Accepted Answer

CRM (customer relationship management) software can help companies analyze customer data to determine the potential lifetime value of each customer. This information can be used to make strategic decisions regarding marketing, sales, and customer service.

Answer: False
 Each customer has a unique lifetime value based on factors such as purchase history, customer loyalty, and potential future purchases. It is not a one-size-fits-all metric.

Answer: False
 Calculating the lifetime value of a customer can be complex and requires analyzing multiple factors. It is not an easy calculation.

Answer: False
 A company can work to increase both customer share (the percentage of a customer's purchases that come from the company) and a customer's lifetime value by providing exceptional products and customer service that encourage repeat business and loyalty.

Answer: True
 The value of the brand can influence a customer's lifetime value. Customers may be willing to pay more for products from a well-respected and reputable brand, potentially increasing their lifetime value to the company.

Which of the Following Statements About the Lifetime Value of a Customer