Please check this to see if I am on the right track. Thanks for your help and time.
Question
Describe at least three activities that represents each characteristic of a Customer Relationship Management plan; share of customer, lifetime value of a customer, customer equity or high-value customers.
Answers
share of customer: What the customer does for the company , how the customers use the companies resoures, what the customer means to the company.
lifetime value: what is the dollar cost per customer meaning, if the customer gives the company an amount of money and the company spends so much on the customer ,what is the profit or lost that the company incurres over a duration of time.
customer equity: what is the dollar cost per customer meaning, if the customer gives the company an amount of money and the company spends so much on the customer what is the profit or lost that the company incurres, also this must be broken down into sub groups. each group must show separation of how profit is created from each group. b/c a high paying customer could mean more risk, but not much profit. but low paying customer how routinly uses the companies resources might mean more profit.
It seems like you have the general idea of what each characteristic represents in a Customer Relationship Management plan, but let me give you a more accurate explanation:
1. Share of customer: This characteristic refers to the percentage or share of a customer's total purchasing power that a company is able to capture. It focuses on developing strategies to increase the share of each customer's purchases within a specific category. Examples of activities that represent share of customer include cross-selling (encouraging customers to buy complementary products or services), upselling (persuading customers to upgrade to a higher-priced product or service), and developing loyalty programs to incentivize customers to make repeat purchases.
2. Lifetime value of a customer: This characteristic is about understanding the total value a customer brings to a company over the entire duration of their relationship. It involves calculating the revenue generated by a customer minus the costs associated with acquiring, serving, and retaining the customer. Activities that represent lifetime value of a customer include analyzing customer data to identify patterns and trends, implementing customer retention programs to extend the duration of the customer relationship, and providing exceptional customer service to increase customer loyalty.
3. Customer equity or high-value customers: Customer equity refers to the total value of a company's customer base. High-value customers are those who have a significantly higher impact on a company's revenue and profitability compared to other customers. To focus on customer equity and high-value customers, companies need to identify and differentiate their customer segments based on profitability. Activities that represent customer equity and high-value customers include conducting customer segmentation analysis, developing personalized marketing campaigns targeting high-value customers, and creating exclusive loyalty programs to reward and retain these valuable customers.
So, to summarize, the activities that represent each characteristic of a Customer Relationship Management plan are:
- Share of customer: Cross-selling, upselling, and loyalty programs
- Lifetime value of a customer: Data analysis, retention programs, and exceptional customer service
- Customer equity or high-value customers: Customer segmentation, personalized marketing, and exclusive loyalty programs.
I hope this helps clarify the activities that represent each characteristic! Let me know if you have any further questions.