Abstract and Keywords
This article synthesizes current knowledge in the area of customer management, and encourages the organization to be proactive in this essential role, which is an important contributor to business success. It addresses the necessary task of how the organization should identify the right customers from the existing customer base. It reviews the available metrics used for customer analysis and decision-making. Furthermore, it also examines the relevant measurement issues associated with the composite profitability measure, customer lifetime value (CLV). CLV can contribute important insights in selecting the right customers to include in the organization's portfolio. This article also discusses customer portfolio analysis. Significant value is gained from systematic customer assessment for acquiring, growing, and retaining the best mix of customers to generate the strongest return on investment. The process of managing the customer portfolio guides the firm in directing the right marketing efforts to the most appropriate marketing strategies.
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