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Compact case
Case
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Reference no. UVA-M-0427
Subject category: Marketing
Published by: Darden Business Publishing
Originally published in: 1994
Version: 12 April 2013
Revision date: 7-May-2013
Length: 5 pages
Data source: Field research

Abstract

Crutchfield, a large US mail-order firm specializing in consumer electronics and personal computers, must evaluate the results of a recent 'prospecting' mailing to a rented list of names. A determination of the mailing requires the calculation of the lifetime value of the new customers acquired. Case data on repurchase probabilities (broken out by recency and frequency) support such a calculation. The case can also be used to introduce the RFM (recency, frequency, monetary value) framework for valuing customers.
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Abstract

Crutchfield, a large US mail-order firm specializing in consumer electronics and personal computers, must evaluate the results of a recent 'prospecting' mailing to a rented list of names. A determination of the mailing requires the calculation of the lifetime value of the new customers acquired. Case data on repurchase probabilities (broken out by recency and frequency) support such a calculation. The case can also be used to introduce the RFM (recency, frequency, monetary value) framework for valuing customers.

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