“Customer Lifetime Value” and business management: assessment methods and strategic aspects of decision-making

• Нигай Евгения Антоновна

  Eugenia A. Nigay. Vladivostok State University. Vladivostok. Russia

The study deals with managing the LTV (Lifetime Value) indicator as one of the key metrics for the effectiveness of a business marketing strategy. The LTV indicator, or “customer lifetime value”, describes the total income received from a client during the entire period of his / her relationship with the company, from the first contact with the advertisement to the final purchase, including the cost of attracting. The objective of the work is to develop the LTV assessment tools and substantiate the methods for calculating the forecast of “customer lifetime value" indicator, adjusted to the specific target planning settings (new customers attraction, increase of average value and frequency of purchases, raise in the long-term customer value). The authors present an overview of the LTV concept and its importance in the context of sustainable development and strategic planning of enterprise activity. They consider applied methods of calculating the LTV and practical approaches to managing this indicator in business. The concept and methodology of this research are based on the general provisions of the strategic planning theory, marketing management, as well as practical aspects of assessing key business performance metrics. The universal methods were used to fully substantiate the toolkit for measuring the LTV indicator: analysis and synthesis, generalization, description, comparison, hypothetical-deductive method, moving from abstract ideas to concrete things. As a result, methods for calculating the LTV are proposed according to the target settings for implementing a customer interaction strategy. The proposed approach is both simple and practical. It allows to consider the dynamics of the customer behavior data. The results of the study can be applied in business when planning the assessment data for the effectiveness of marketing programs and the customers’ interaction.
Keywords: LTV; "customer lifetime value"; strategic planning; marketing management; customer relationship.