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Customer Value Management Assignment Help

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Added on  2020-10-05

Customer Value Management Assignment Help

   Added on 2020-10-05

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CUSTOMER VALUEMANAGEMENT
Customer Value Management Assignment Help_1
TABLE OF CONTENTSINTRODUCTION...........................................................................................................................1TASK 1............................................................................................................................................1P1. Components that enable an organisation to determine and calculate a Customer’s LifetimeValue...........................................................................................................................................1P2. Benefits of customer lifetime value to the organisation.......................................................3P3. Factors that influence the customer's lifetime value.............................................................4TASK 2............................................................................................................................................5P4 Market segmentation strategies that can be applied to a customerbase:............................................................................................................................................5P5 B2B and B2C decision amking model...................................................................................7TASK 3............................................................................................................................................8P6 different techniques and methods organisations can apply to increase customerrelationships and customer loyalty:............................................................................................8CONCLUSION..............................................................................................................................10
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INTRODUCTIONCustomer value management is the activity where an organization increases theirconsumers through online procedures. CVM is an art which is increasing buyers. In this report,Homebase describes SMS communication easily adopt and through SMS company provide theirspecific details about the products to and their service how to they supply products to customers.Mainly, Homebase is home improvement company provided their customers to homeimprovement products in retail price like garden, kitchens, outdoor living, paint & decoratingetc. In this report, components that enables an organization to determine and calculate thebenefits of CLV are included (Fitzroy and et.al., 2016). Also, factors that influence customer’slifetime value and types of market segmentation strategies applied to customer’s base, B2B andB2C decision making models as well as different methods and techniques applied to increasecustomers relationship a consumer are discussed.TASK 1P1. Components that enable an organisation to determine and calculate a Customer’s LifetimeValueIn Homebase, several components help to calculate the customer's lifetime value. In thosecomponents helps to determine the formulas which calculates the all over CLV. The componentincludes the traditional and simple formulas which define the annual cost of the per prospectorsand consumers relationship. In the Home base marketing manager understand the all overrevenue of the CLV.Calculate customer’s lifetime value- Marketing manager at Homebase determines theCLV require looking at the length of the customer’s retentions rate, average profit margins percustomers and customers churn rate. Moreover, several ways to calculate CLV in Homebase. Tocalculate the CLV include the traditional and simple formula.Historic CLV- In this marketing manager at Homebase defines the sun of all profits formthe past purchase and based existing consumer data from a specific period.Predictive CLV- In this manager allows finding how much revenue a prospector willgenerate from the business. This component's considerer more complete assessing CLV. Thepredictive method determines the current value of the customers and determine how consumer’svalue will evolve with time.1
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Simple formula CLV- This is most basic way to determine the CLV is added the revenue earnedfrom customers and defines the average revenue multiplied by the average of customer’slifespan. (Annual revenue per prospector*consumers relationship in year)- Clients acquisition costFor example- Home generate $3,000 per year customers with an average customer's lifetime of10 year and CAC of $5,000 for each customer. And the organization calculates like that-$3,000*10-$5,000= $25,000 This formula helps to calculate the annual revenue of the company and also calculateseach profit of customers.Traditional CLV formula- In this formula marketing manager at Homebase defines thecompany gives discount and then calculates the overall coast of the company (Flint, andWoodruff, 2014). This traditional formula a help to take discount rate and considerations providemore details to understand CLV. In addition, marketing manager defines the CLV break equationand the individual cost a profit of each year. There is the important pint which defines thetraditional calculate formula-Gross amount *(holding rate/[1+rate of discount -retentions rate]Rate of discount Prospector retentions rate Average gross margin per buyer lifespan.This formula defines customer’s revenue, time and allover year discount to account forinflation. If manager is not sure about the discount they consider with other organizations andknowing the discount rate of products. Home base is home improvement company theirmarketing manager calculates cost of the all-over products and also defines the retentions ofcustomer. This formula help to increasing the customers' retention value and also defines eachcustomers' revenue on the each products.Estimate CLV- This component's analysis the Homebase consuming power and theaverage order of business. Marketing manager analysis the $50 and 10% chance of coming backand repeat purchase and the finally assume cost $15 to each customers the total revenue canexpect to get from each customers to average value divided by one minus the repeat purchaserate like $50(1-0.1) =$55.56 and subtract purchase acquisitions cost that and get a customer's2
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