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Bringing Customer LifetimeValue to Life:
Practical Methods and Applications
Dates: Jan 31, 2013 - Feb 1, 2013.
Location: San Francisco Tuition: $2,400
Customer Lifetime Value (CLV) is a critical concept for virtually every organization that claims (or aspires) to be customer centric. At a granular level, it helps companies decide which tactics should be used for which customer; a more macro level, it is the key ingredient in calculating customer equity - which, in turn, drives overall corporate valuation.
But despite the importance of CLV, it is still poorly understood by many companies at both a conceptual and mechanical level. A host of problems (e.g., mistaking historical customer profitability for CLV, or not properly distinguishing between a contractual and non-contractual business relationship) can throw a company off course and lead to disappointing outcomes in its efforts to better understand and leverage its customer data. The purpose of this workshop is to bring clarity to these kinds of issues, and to give managers and analysts access to (and confidence in) the skills they need in order to truly compute and utilize CLV in a practical business setting.
The two-day workshop is organized around two major themes. One, as noted earlier, is the distinction between contractual and non-contractual settings. This dichotomy has important implications that merit discussion at a strategic level, and it points out the need for different modeling assumptions, operational steps, and validation methods when it comes to CLV implementation.
The second theme arises from the methodical approach that underlies all of the analyses covered in the workshop, namely probability models. While less familiar than regression analysis and the wide array of methods that fall under the "data mining" umbrella, this class of models is uniquely well-suited for the challenges of computing CLV (e.g., the need for long-run forecasts) and is remarkably simple from both a data management and model estimation standpoint (often requiring nothing more than an Excel spreadsheet for complete model implementation). Our coverage of probability models will be woven into the workshop as a "means towards an end" with modest (and "manager friendly") handling of the technical details and model implementation in Excel.
By the end of the workshop, participants will understand the critical concepts and techniques required to make meaningful and accurate statements about CLV in a variety of different managerial settings. Likewise, they will be keenly aware of the limitations and concerns of other approaches that are often used for similar purposes. Thus, besides having the skills to build models themselves, participants will know how to ask the right questions of consultants and IT vendors who offer services in this important area.
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This program was formerly called Probability Models for Customer-Base Analysis.