Derivation of customer lifetime value and building decision support model for a company

2017 Fiscal Year Final Research Report

• Project/Area Number: 25380562
• Research Category: Grant-in-Aid for Scientific Research (C)
• Allocation Type: Multi-year Fund
• Section: 一般
• Research Field: Commerce
• Research Institution: The University of Tokyo
• Principal Investigator: ABE Makoto 東京大学, 大学院経済学研究科(経済学部), 教授 (70302677)
• Project Period (FY): 2013-04-01 – 2018-03-31
• Keywords: RFM分析 / 顧客生涯価値(CLV) / 顧客関係管理(CRM) / 既存顧客維持介入 / 新規顧客獲得 / 1to1マーケティング

Outline of Final Research Achievements

The wide use of RFM analysis in CRM suggests that these measures contain rather rich information about customer purchase behavior. This research, using the RFM measures of a customer, develops an individual-level CLV model that identifies the underlying behavior traits of purchase rate, lifetime and spending, which are then linked to CLV. In the application to two datasets, frequent shoppers program data from a department store and a CD chain, the model produces customer-specific metrics that are useful for identifying preferred customers and taking marketing actions targeted at the individual level in CRM. The research then presents a retention program for existing customers that is most effective in terms of Marketing ROI, such as what action needs to be taken to which customers at which timing. For prospective customers without RFM measures, by relating the demographic characteristics to behavioral traits, insight into acquisition strategy is obtained.

Free Research Field

マーケティング・サイエンス