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Unit 38 Customer Value Management

Table of Content

  1. Introduction


In this respective report, the identification of the important feasibility regarding the attainment of customer values are significantly adhered within this report so as to ensure proper perspectives for identifying the importance has been achieved. The directives will have been segmented through which the retail organization has emphasized the possession by identifying the impact sustaining upon the considerations that has cumulated the perspectives by which the differentiation has been gathered. Therefore, the directives will be evaluated from the aspects considering the effectiveness that has ensured about the identification by which the considerations will be conducted through determining the success accomplished through judging the factors thoroughly. Thus concept of understanding overall values has been ensured within the report so as to cumulate the observations structured upon the identification considering the activities are regulated. Different approaches of the segmenting the customer values have been identified in order to understand the observation and requirement of the firm for considering the approaches of increasing the lifetime values has been ensured within this report.

LO 1 Demonstration of understanding the concepts of customer lifetime value and factors that has influenced it

P1. Explanation and analysis regarding the various components that has enabled the organization for determining the customer lifetime value

Customer Lifestyle value is an important part of the business astuteness which depicts for the business organizations to demonstrate a perfect strategy for growth in respective sector of the industry. In the contemporary business world, most of the customers adhere for various methods for calculating the CLV as well as for determining the CLV value to their organization’s profitability. Firstly, it can be seen that the business organizations take the help of average sales value for the first transaction they have confronted with the customers. Secondly, in many cases, it can be identified that the organizations are counting on the value or purchase they acquire from the customer after the first purchase which is inclusive of the cross-sell and up -sell revenue if they relevant to the particular company (Gayialis, 2015). Thirdly, it can be amalgamated that the organizations determine the period of time for which the customer has continued to do with business with them in terms of per annum. For a retail organization like Tesco, they adhere to marketing metrics for finding on the probability of selling their product interfaces to the customers in UK where it can be identified that about 20-40% of their customer’s probability of buying from their different stores are calculated. Moreover for a retail giant like Tesco, it can be underpinned that the company also adheres over the process of retention of the customers in their various stores which determine that how much the customers are associated with their new product lines and innovative services. The supervision of the customer records regarding their purchasing behaviour is another factor, which is practiced by Tesco for calculating the lifestyle value of the customer.

P2 Explanation and justify the benefits of customer life time value to the respective organization

CLV has rise out to be an important aspect for any organization as it entails on different beneficial situation for the companies. CLV clearly states for the relation the organization has put on for the customers in respect of what they have put in for the customers. one of the striking aspect of CLV determines that the amount of money they have spent over for customer acquisitions has been surpassed the amount of profit they have earned from the customers while dealing with them regarding shopping experience. Tesco, as one of the biggest retail giant of UK affirms their business position to be confronted by this scenario as they applies for this technique to count the benefits regarding CLV in business periphery. Some of the advantages of CLV for organizations like Tesco are as follows:-

  • Through CLV, the company has been able to calculate the accurate budget they have implied over business as it can be identified that customers for them represents the highest allowable acquisition cost.
  • The CLV for the organization determines the predictability of the revenues being collected and this helps them in starting on a budget proposal for next financial year for achieving a sustainable growth (Evangelopoulos, 2015).

P3 Evaluation of the factors that has influenced the customers lifetime value

Customer lifetime value is emancipated as one of the most important and also a crucial technique that can adhere higher viability regarding the assessment and business offering the judgement that will easily enhance the customer orientation within the business. In the business organizations that follows the business to customer marketing approach the customer lifetime value has been generated as the input through which the determination regarding the reasonable perspectives that are needed to be spend for acquiring a customers through the costing applications are structured. In order to feature the importance within the business within the retail company Tesco Plc, it is important to use the customer lifetime value as the input in order to determine the reasonable features that are needed to spend for acquiring the customers. These perception has inhibited the cost of customer acquisition but considering the performance of the B2C companies within the world, the approach of customer lifetime value upon the business decisions have been made to secure the faster accomplishment regarding the revenues. It has been encapsulated that there are also some of the easier path that can ensure about the significance following upon the activities in judging the perception for acquiring the profitability regarding the path of revenues. Thus, the considerations of both the inevitable path are subjected towards the profitable instances for the respective feasibility. On the other hand, the costs has been accumulated towards securing the customers within the retail market has insisted the business by justifying five times the expenses that has been ascertained. Therefore, it is assured that more than 80% of the marketing budgets strengthened with different financial activities are justified so as to ensure proper derivatives so as to synchronize the conditions accumulated upon different factors significantly. The measurements identifying the customer lifetime values have been accurately inherited by the means of strengthening the interventions of the business decision regarding the firm. Thus, proper focus upon the customer interactions within the proper system has been recorded without any luxury by achieving the customer centricity that has provided to unlock the maximization techniques applied within the customer lifetime values. Moreover, the customer lifecycle has also inherited through underpinning the application sufficed through making proper ROI by assuming several non-directive responses regarding the campaigns, which are also attributed towards the investments within the social media (Katimertzoglou, 2015).

Alternatively, the metric assessing the values of customer lifetime sales has ensured about the split regarding the actual along with the potential empowerment regarding the illustration made from the possible growth along with the dynamics thoroughly. Thus for predicting the future consequences of the earnings has adhered the predictive analytics through which the forecasts regarding the future valuation through identifying the customer relationship of the respective firm that are operating within the retail market like Tesco Plc. The approaches has been succeeded through maintaining the difference considering the accounts that has justified the statistical approach that are much more applicable in sustaining the feelings through which the employees are considered to be much more responsible. Moreover, the subjective assumptions are considered to be based upon the gut feelings through which the accidental measurements are featured with the informal definitions. Considering the addition, another metric has enabled the estimation of the sales that are daunting with the assessment of the KPI. Thus decent justification has been placed for making proper adoption through suggesting the important areas that has applied with the business to business about the revenues through streamlining the features of the business. Providing priority so as to enrich the potential activities has generated the ability to identify the knowledge that has suppressed the leads regarding the customer within the retail market of the firm (Drehmann and Juselius, 2014). Therefore, value regarding the different customers and their accounts has been measured through nurturing the retention activities much more efficiently through pertaining the feasibility considering the perception concerning the activities that has generated the sustenance in order to achieve proper planning activities required within the business for the organization like Tesco Plc.

LO 2 Evaluation of the different segments within the customer base along with the opportunities for customer value and their respective creation

P4 Determination along with explanation of different types of market and their segmentation strategies that are applied to different customer base

For gaining the appropriate business market and for gaining profitability of the business operation the process of identifying and selecting the market segmentation is very much necessary. The process of developing the market segmentation process helps for developing the product specification. The understanding of the demand of the people and the economic condition of the business market helps for understanding the segmentation process. The understanding segmentation process helps for identifying the customers for the business operation (Schalteggeret al. 2016, p.20). The development of the product and the specification of the product also dependent on the identification of the customer base and the appropriate customers in the business operation. in addition to this, the understanding of the market segments also helps for developing KPI for the business operation. The understanding process of the KPI also helps for developing the business operation. moreover, it also helps for understanding the demand of the people. For understanding requirements regarding the developmental process of the product quality and specification. Moreover, it also helps for developing the marketing strategy and the understanding regarding the B2B and B2C market analysis process in the business operation. However, the analysis of the market is not enough for developing the business operation. The inclusion of the customer in the business operation also helps for understanding the need of the business market and it also helps for deciding the target market in the business operation (Panayiotouet al. 2016, p.628). The fulfilling requirements and the expectation of the customer also helps for developing the business process of the organization. In addition to this, the customer also helps for understanding the risk of the business market. Furthermore, the understanding risk of the business market also helps for understanding the factors that impacts value creation process of product in the business operation.

P5 Evaluation of the B2C along with B2B models regarding decision making for generating the insights and opportunities for the value creation among customers

In case of developing the situation of the Tesco, as a marketing manager, the analysis of the B2B and B2C market is necessary. The analysis helps for understanding the impact of the value creation of the products and it also helps for generating the idea regarding the perception of the people. In addition to this, the inclusion of the procedure to reach to the customer is also an important part for developing the business operation. The communication with the customers will help for developing the understanding regarding demand of the market. In addition, the understanding of the demand of the market will also help for generating the process of improving the position and pricing strategy of the company. The digital media and the communication process with the customer market will help for developing the business strategy (Chang, 2016). The analysis of the business strategy and the market has helped for deriving that the inclusion of the customers in the business operation helps for understanding the demand of the market and it also helps in the process of the betterment of the productivity and the production quality. In addition, creating the brand loyalty through promotion also helps for gaining customers in the business operation. The process of creating the brand loyalty through promotion includes the process communicating with the customer for understanding their feeling and their perception while choosing the product or a company. Furthermore, the comparison of the involvement theory with this process helps for understanding the basic need of developing the business strategy and the marketing strategy for gaining more customer base. The understanding of the involvement theory reveals that the development of the products needs to be done via the feedbacks and the analysis of the customer demand. This is why, as the development of a products and the loyalty of a customer in a particular product includes two factors (Baker and Wurgler, 2015). The first one is referred to the mentality and the buying behaviour of the customers and the second one is the emotional attachment of the customer with the product or the company. As a marketing manager, understanding of the both factors are very much necessary as it helps for developing the quality and the specification of a product. In addition to this, the involvement of the customers in the business operation also helps for developing the pricing strategy of the business organization also. The development of the pricing strategy also helps for gaining customers as the economic factor and the pricing factor plays and important role in the process of developing the brand promotion and the brand loyalty for the customers (Volgger and Pechlaner, 2014). Apart from this, the analysis of the business market is also necessary for understanding the risk factors of the business market. The process of understanding the risk factors like the competitive market, substitute company etc. also helps for developing the business strategy and the quality of the product. Thus, the brand loyalty of the customers also increases. If you want to ace in your dissertation then without a second thought, seek our help with assignment writing services.

LO3 Analysis of different techniques and methods for increasing the lifetime value of customers

P6 Analysis of the different techniques along with methods that are applied at the different stages for increasing customer relationship and customer loyalty

The analysis of the condition of the Tesco Plc it has been observed that the marketing strategy and the business strategy of the company both are non-profitable. In addition, in the view of the marketing manager it has been seen that the company need to create the well maintained and well-developed relationship with the customers (Begenau, 2016). Moreover, the customers will help for developing the profitability and the sales operation of the business organization. The inclusion of the digital media and structurally formed interaction process with the customers will help the company for developing the relationship. The inclusion of the social media in the business operation will also help for developing the relationship. The social media will help for communicating with the customers and the social media will also help for understanding the demand of the customers by which the company will be able to identify the proper requirement of the production (Bryman and Bell, 2015). The involvement of the customers in the business operation will help for developing the production of the business operation. Apart from this, the development of the business strategy will also be improved with the help of the involvement of the customers in the business. In addition, the inclusion of the customers and the communication through the social media will also help for improving the business (Sekaran and Bougie, 2016). The implementation of the infectious communication in the business operation will also help for developing the interest of the customers towards the business organization, which will be very much helpful for understanding the requirements of the customers in the business operation. Moreover, the development of the business strategy will also be helpful for the company. For instance, inclusion of the IoT in the business operation will help for developing the business strategic advantages. It will help the company adding the extra BI in the business operation. Moreover, it will also help the organization for operation the entire business operation automatically. The development of the business operation will be influenced with the help of the IoT installation. The implementation of the BI in the business operation helps for developing the auditing process and helps for improving the business process also. Moreover, the issue with the financial operation will also be improved by using the BI in the business operation. In addition, it will also help for developing the quality of the products and thus the customer will be much attracted towards the business operation. Moreover, the company will get the chance for creating the signature in the brand promotion, which will indirectly help for improving the brand loyalty and will help for gaining the customer loyalty in the business o0peration. Moreover, the employee management system of the business organization will also be improved with the help of this company’s strategy for implementing the loyalty programs for the employees and the customers also. The rewarded scheming will help for developing the performance of the employees. In addition to this, the rewarding scheme will also help for gathering the attention to the customers in the business operation (Drehmann and Juselius, 2014). However, the development of the business process is not dependent on this system. Finally, the implementation of the IoT in the business operation will also help the company for improving the promotional strategy and the supply chain system of the business organization. The development of the business supply chain system will help for managing the business and will help for increasing the profit ratio of the business by developing the productivity and the distribution of the products.

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Thus it can be ascertained that the customer values are highly important for securing the aspects considering the factors that are essential to pertain the effective workflow in the adjusting period so as to justify the progressions that are important through underpinning the customer value management of the firm.


  • Baker, M. and Wurgler, J., 2015. Do strict capital requirements raise the cost of capital? Bank regulation, capital structure, and the low-risk anomaly.American Economic Review,105(5), pp.315-20.
  • Begenau, J., 2016. Capital requirements, risk choice, and liquidity provision in a business cycle model.
  • Bryman, A. and Bell, E., 2015.Business research methods. Oxford University Press, USA.
  • Chang, J.F., 2016.Business process management systems: strategy and implementation. CRC Press.
  • Drehmann, M. and Juselius, M., 2014. Evaluating early warning indicators of banking crises: Satisfying policy requirements.International Journal of Forecasting,30(3), pp.759-780.
  • Panayiotou, N.A., Gayialis, S.P., Evangelopoulos, N.P. and Katimertzoglou, P.K., 2015. A business process modeling-enabled requirements engineering framework for ERP implementation.Business Process Management Journal,21(3), pp.628-664.
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