Introducing a Novel Model to Determine CLV
Customer Relationship Management (CRM) is a productive tool for monitoring the customer and recognizing their characteristics, behaviors, and his/her requirements and anticipating his/her reactions in order to establish a long term and strong relation with customer. CRM is a business strategy select...
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| Format: | Article |
| Language: | English |
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University of Tehran
2009-03-01
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| Series: | Journal of Information Technology Management |
| Subjects: | |
| Online Access: | https://jitm.ut.ac.ir/article_19951_210645da2ccb9327a31a01548e530b14.pdf |
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| _version_ | 1850179821824376832 |
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| author | Jafar Razmi Arash Ghanbari |
| author_facet | Jafar Razmi Arash Ghanbari |
| author_sort | Jafar Razmi |
| collection | DOAJ |
| description | Customer Relationship Management (CRM) is a productive tool for monitoring the customer and recognizing their characteristics, behaviors, and his/her requirements and anticipating his/her reactions in order to establish a long term and strong relation with customer. CRM is a business strategy selecting and managing the most valuable customer relationships. CRM includes different parts and dimensions that covers the whole stages of business from marketing to conclusion of contract, R&D, product/service design, sale and period after that. One of the important tools applied in CRM is Customer Lifetime Value (CLV). CLV allocates a quantitative value to each customer or a specific group and ranks them with this quantity. Different methods have been introduced to calculate this quantitative value. This paper tries to analyze all mentioned methods and presents the weakness and strength of each method. The most weakness of the typical method is not to concentrate on the future value of the customer. In order to rectify the weakness, in this paper an innovative model which combines two methods of RFM (which considers qualitative factors) and ROI (which considers financial factors) has been introduced. The validation of the model has been accomplished based upon real case study of one of the Iranian Insurance Companies. |
| format | Article |
| id | doaj-art-99d54c8a7a32440aa1d264a14f58c708 |
| institution | OA Journals |
| issn | 2008-5893 2423-5059 |
| language | English |
| publishDate | 2009-03-01 |
| publisher | University of Tehran |
| record_format | Article |
| series | Journal of Information Technology Management |
| spelling | doaj-art-99d54c8a7a32440aa1d264a14f58c7082025-08-20T02:18:24ZengUniversity of TehranJournal of Information Technology Management2008-58932423-50592009-03-012219951Introducing a Novel Model to Determine CLVJafar RazmiArash GhanbariCustomer Relationship Management (CRM) is a productive tool for monitoring the customer and recognizing their characteristics, behaviors, and his/her requirements and anticipating his/her reactions in order to establish a long term and strong relation with customer. CRM is a business strategy selecting and managing the most valuable customer relationships. CRM includes different parts and dimensions that covers the whole stages of business from marketing to conclusion of contract, R&D, product/service design, sale and period after that. One of the important tools applied in CRM is Customer Lifetime Value (CLV). CLV allocates a quantitative value to each customer or a specific group and ranks them with this quantity. Different methods have been introduced to calculate this quantitative value. This paper tries to analyze all mentioned methods and presents the weakness and strength of each method. The most weakness of the typical method is not to concentrate on the future value of the customer. In order to rectify the weakness, in this paper an innovative model which combines two methods of RFM (which considers qualitative factors) and ROI (which considers financial factors) has been introduced. The validation of the model has been accomplished based upon real case study of one of the Iranian Insurance Companies.https://jitm.ut.ac.ir/article_19951_210645da2ccb9327a31a01548e530b14.pdfCustomer Lifetime Value (CLV)Customer prioritycustomer relationship management (CRM) |
| spellingShingle | Jafar Razmi Arash Ghanbari Introducing a Novel Model to Determine CLV Journal of Information Technology Management Customer Lifetime Value (CLV) Customer priority customer relationship management (CRM) |
| title | Introducing a Novel Model to Determine CLV |
| title_full | Introducing a Novel Model to Determine CLV |
| title_fullStr | Introducing a Novel Model to Determine CLV |
| title_full_unstemmed | Introducing a Novel Model to Determine CLV |
| title_short | Introducing a Novel Model to Determine CLV |
| title_sort | introducing a novel model to determine clv |
| topic | Customer Lifetime Value (CLV) Customer priority customer relationship management (CRM) |
| url | https://jitm.ut.ac.ir/article_19951_210645da2ccb9327a31a01548e530b14.pdf |
| work_keys_str_mv | AT jafarrazmi introducinganovelmodeltodetermineclv AT arashghanbari introducinganovelmodeltodetermineclv |