Aim of Unit 38 Customer value management
Unit 38 Customer Value Management emphasizes upon the marketers to gain knowledge about managing the values of customers using various concepts. Every organizations tend to create a relationship with the customers which is beneficial from both ends. This becomes a matter of importance when a new customer is considered for pricing. Gaining a new customer becomes quite harder than retaining an old customer. In addition to that a new customer cannot be held as a permanent customer and for that purpose organizations tend to create ways for retaining customers. In order to understand customers organizations create ways to understand them. This could be done by using data and research. Using correct data and proper research could create an enhancement in the values of customer and its longevity with the organization.
Learning outcomes
LO1 Demonstrate an understanding of the concept of customer lifetime value, how to calculate it and the different factors that influence it
LO2Evaluate the different segments in a customer base and the appropriate opportunities for customer value creation
LO3Analyze appropriate techniques and methods in order to increase customer lifetime value (e.g. cross-selling, loyalty and upselling)
LO1 Demonstrate an understanding of the concept of customer lifetime value, how to calculate it and the different factors that influence it
In order to understand customer lifetime values certain traditional concepts that are compared with attention and values could be used. This helps in understanding the values of the customer and ensure engagement with the organization for a lifetime. In addition to that Customer Lifetime values along with its merits and analysis could also be used to understand such concept. Measurement could be done with the data gained and analyzation of Customer Lifetime Values. In order to calculate the value rate of retention, transactions and cost of customer acquisition could be taken into account. This could help in figuring a sufficient value of customer lifetime. Lastly in order to create a balance in the model of business certain factors of CLV’s like customer’s experiences and business to customer relationship could be taken into account.
LO2 Evaluate the different segments in a customer base and the appropriate opportunities for customer value creation
In order to evaluate various segments that could influence the customer base certain perceptions could be taken into account. Such perception would positively rely upon customer’s perceptions such as motive, expectation section and many more. Moreover, imagery of consumer is simultaneously important which helps in building relationships and images. In addition to that identification and diagnosis for creating values could be attained by theories of involvement, determining the risk taken by customers, loyalty to the brand and recognition. Various models of Business to customer relationship and business to business decision making could also be used for such evaluation.
LO3 Analyze appropriate techniques and methods in order to increase customer lifetime value (e.g. cross-selling, loyalty and upselling)
Appropriate techniques and methods helps to increase the value of a customer. This could be done by proper analyzation of the methods and techniques. Business to customer and business top business contexts could be used to figure out various strategies of value creation. With the increase in technology, the use of digital strategies have also rapidly increased. Such strategies include communications by using mobiles and social media platforms. The Internet has also helped in creating loyalty and trust for the brand. Moreover various other strategies to contact and sell could also enhance the lifetime value of consumers.
Learning Outcomes andAssessmentCriteria
| Pass | Merit | Distinction |
| LO1Demonstrateanunderstandingoftheconceptofcustomerlifetimevalue,howtocalculateitandthedifferentfactorsthatinfluenceit | LO1,LO2andLO3 D1Provideevidenceofcriticalevaluationandsynthesis of the key concepts of customer lifetime value management in an organisational context. | |
| P1 Explain and analyse the various components that enable an organisation to determine and calculate a customer’s life time value. P2 Explain and justify the benefits of customer lifetime value to an organisation. P3 Evaluate the factors that influence the customer lifetime value. | M1Apply the concept of customer lifetime value and the use of collating customer data within a specific organisational B2C or B2B context. | |
| LO2 Evaluate the different segments in a customer base and the appropriate opportunities for customer value creation | ||
| P4Determine and explain the types of market segmentation strategies that can be applied to a customer base. P5EvaluateB2CandB2Bdecision-making models and demonstrate how opportunities for customers value creation can be applied. | M2Critically evaluate various segmentation models in a B2C or B2B context to generate key insights and marketing intelligence for customer value creation. | |
| LO3 Analyse appropriate techniques and methods in order to increase customer lifetime value | ||
| P6 Analyse the different techniques and methods organisations can apply to increase customer relationships and customer loyalty. | M3Evaluate the appropriateness of techniques and methods applied at different stages of the consumer decision-making processand CLV. |
Links
This unit links to the following related units:
Unit 23: Integrated Marketing Communications
Unit 29: Managing and Running a Small Business
Unit 37: Consumer Behaviour and Insight