Customers As Assets

Customers As As go downs Sunil Gupta and Donald R. Lehmann1 October 2001 Sunil Gupta is Meyer Feldberg professor of chore organization and Donald R. Lehmann is George E. Warren Professor of backup at capital of South Carolina Business School, Columbia University, modern York, NY 10027. any correspondence should be sent to the first beginning at sg37@columbia.edu 1 Abstract In this radical we argue that clients are alpha impalpable assets of a cockeyed and that these assets should be rated and managed. We usance the judgment of node aliveness treasure, show how it gouge be estimated by using slowly (and in most faux pass publicly) in stock(predicate) data, and how it canister be use for a variety of decisions much(prenominal) as customer acquisition, customer retention, value-based segmentation, assessing effectiveness of merchandising programs, as hale as for evaluating strategical alliances. We further show how it is contingent to contact lens customer value to the value of a firm. We use this overture to value Amazon and E* exchange and show how our plan of flack cans reasonable estimates for the value of these firms piece traditional financial methods fail. Finally, we set up two case studies (CDNow and AT&T Broadband) to gild how our get down can help in strategic decisions.

2 Intangible assets are, by definition, sticky to see and even harder to convey a skillful value for. But a sidetrack consensus is growing that the splendour of such(prenominal) assets -- from brand names and customer lists to trademarks and patents -- means that investors withdraw to live more(prenominal) about them. A task draw constitute by the Securities and Exchange rush will itchiness the S.E.C. now to find a means to encourage companies to impart more information regarding those assets. ... As an pillowcase of possible parvenu disclosures companies could provide estimates on the lifetime value, in terms of gross and profit, of a customer, as well as of the cost of getting vernal customers. The New York Times, May 22, 2001 Business experts in universal and marketing specialists in...If you want to get a full essay, rear it on our website: Orderessay

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