When companies calculate the lifetime value of a customer they look at ________.
A)the lifetime expectancy of the product the customer purchased
B)the career path of the customer to see if they may move to a different geographic area and no longer purchase from this company
C)the commission amount the company must pay the sales representative who worked with the customer
D)the age of the customer to see if they may live long enough to utilise the product being sold
E)how much profit they expect to make from a particular customer,including each and every purchase they will make from them now and in the future

Question

Quizplus · Accepted Answer

The lifetime value of a customer is calculated by considering the amount of profit the company expects to make from the customer over their lifetime, including all future purchases. Factors such as the customer's age, the commission amount paid to the sales representative, and the lifetime expectancy of the product are not considered in the calculation. The career path of the customer may be taken into account if it affects their purchasing behavior, but it is not a major factor in calculating the lifetime value of a customer.

When Companies Calculate the Lifetime Value of a Customer They