• http://www.indexwebmarketing J. Easterbrook

    Hey Siddharth,

    interesting concept but what tools how do you track long term customer value?

    Do you have tools or methods, I’d love to hear them out.

  • http://www.efrontier.com sidshah

    We use a combination of techniques to calculate CLV. Some of our customers are able to track a customer once a sale is made. Essentially, the customer builds a profile and then comes in as a cookied user into the website. Subsequent purchases can then be tracked to the customer if he/she logs into his/her profile. Another way of identifying repeat customers in retail is mapping mailing addresses to the purchases.

    On the optimization side, if you can map a purchase as a first/second/third purchase etc you can under certain assumptions optimize to CLV relatively easily. The formulation derivation is a little involved and will make for another blog post itself !