When companies calculate the lifetime value of a customer they look at ________.
A) how much profit they expect to make from a particular customer, including each and every purchase she will make from them now and in the future
B) the positive word of mouth about the product that the customer can spread among her family, friends, and acquaintances
C) the lifetime expectancy of the product the customer purchased
D) the age of the customer to see whether she is likely to live long enough to utilize the product being sold
E) the career path of the customer to see if she may move to a different geographic area and no longer purchase from the company

Question

Quizplus · Accepted Answer

When calculating the lifetime value of a customer, companies consider how much profit they expect to make from that particular customer, including each and every purchase she will make from them now and in the future. This takes into account repeat purchases and the potential for upselling or cross-selling to increase the customer's value over time.

When Companies Calculate the Lifetime Value of a Customer They