Lifetime value modellingAn appreciation of lifetime value (LTV) is key to the theory and practice of customer relationshipmanagement. However, while the term is often used, calculation of LTV is notstraightforward, so many organisations do not calculate it. Lifetime value is defined asthe total net benefit that a customer, or group of customers, will provide a companyover their total relationship with the company. Modelling is based on estimating theincome and costs associated with each customer over a period of time and then calculatingthe net present value in current monetary terms using a discount rate value appliedover the period
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