Question

Analytics Mini Case: Evaluating the Prospect Lifetime Value of new Customers in a B2B Setting You work for a company that specializes in selling a special anti-glare coating that can be sprayed onto glass. This product is uniquely capable of covering extremely large pieces of glass and can be sprayed on even after the glass has been installed onto a building. Because of this, you tend to sell this product to large commercial organizations You have been tasked with identifying new prospects to recommend the sales team to approach. Your goal is to only recommend that the sales team approach potential customers who will be a profitable long-term investment for your business. To help you do this, your analytics team has already calculated a series of metrics about these prospective businesses. These metrics are provided below. You have randomly selected a small subset of 4 potential prospects from a database to practice developing and interpreting the PLV. Click the icon to view the metrics. !!! Click the icon to view a small subset of 4 potential prospects from a database. According to these estimates, should we attempt to acquire every one of these potential prospects?

Answer 1

PLV for

Business A = (15+15)x0.28 -15 = - 6.6

Business B = ( 11+144)x0.28 -10 = 33.4

Business C = ( 4+139)x0.1 -12 = 2.3

Business D = (100+24)x0.2 -8 = 16.8

Considering Above values, the business A has negative value of PLV so it should not be acquired. among rest of the three businesses. B and D have healthy PLVs so they can be acquired, while C can also be pursued having positive PLV .

The answer is No, because each one of the four can't be acquired.