Customer lifetime value: assessment of current methods of estimating CLV and scope for improvements in the same

Abstract

Customer Lifetime Value (CLV) has been a widely researched topic recently. It has seen implementations not just in the marketing domain but in other industries as well such as banking and finance industry. Different types of models have been suggested by researchers. While attempts have been made to do a comparative research of the existing models of Customer Lifetime Value, the focus of these studies have been varied. In this project, we focus on doing a comparative study of different models of CLV with the aim of finding the assumptions, limitations and gaps in these models. We have created a detailed timeline of the research conducted in the domain of Customer Lifetime Value, analysed how the progression of research has taken place, and how newer research papers have tried to address the issues of earlier papers. Our recommendations flow from this analysis.