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Interactive Connect Assignment Part 1 2 Week 2: Interactive Connect Assignment Part 1 MBA 5300
Interactive Connect Assignment Part 1 2 Customer Lifetime Value (CLTV) Customer lifetime value is the metric that indicates the total revenue a business can reasonably expect from a single customer account. It considers a customer's revenue value, and compares that number to the company's predicted customer lifespan. Businesses use this metric to identify significant customer segments that are the most valuable to the company. CLTV tells companies how much revenue they can expect one customer to generate over the course of the business relationship. The longer a customer continues to purchase from a company, the greater their lifetime value becomes. Customer Lifetime Value Model 1. Calculate average purchase value: Calculate this number by dividing your company's total revenue in a time period (usually one year) by the number of purchases over the course of that same time period. 2. Calculate average purchase frequency rate: Calculate this number by dividing the number

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