Sunshine Juices estimates customer lifetime value for 1 "Urban Surge" customer at $375.15. This $375.15 is...
Sunshine Juices estimates customer lifetime value for 1 "Urban Surge" customer at $375.15. This $375.15 is equal to
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A. Total contribution margin, net of costs, generated by the customer over the expected lifetime of the relationship, discounted to present value. |
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B. Expected total value of revenue that the customer will generate for the firm. |
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C.The number of units of product that the company can expect the customer to purchase. |
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D. The value of the customer to the firm in one year, multiplied by the expected length of the relationship. |
Homework Answers
option (A) seems correct as cutomer lifetime value is contribution expected net of cost generated by customer over the expected lifetime relationshi discounted to present value.
as per wikipedia site - CLV = Margin*(Retention rate%) / ((1+discount rate ) - retention rate))
which satisfy the all the requirements given in option A.
and also customer life time value can be calculated on margin earned from customer till the customer in relationship on present value.
other options does not satisfy the same that's why are incorrect.
in case of any doubt please revert.
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Sunshine Juices estimates customer lifetime value for 1 "Urban
Surge" customer at $375.15. This $375.15 is...
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