CLV Valuation And Application In Marketing Strategy

In the traditional strategy of marketing, companies are more concerned in the customer value in the customer's angle of view, and study how to provide more valuable products and services for customer, and what properties of products and services can satisfy customer better. However, though most companies attach importance to customers inwardly, they can not implement it in action. Most companies ignore an important thing-the value of customer to company (customer value in the company' angle of view). Efficient strategy based on customer mainly considers customer value in 2 ways: value provided to customer by company and value created by customer for company. The method of study customer value considers that marketing investments are needed to provide value to customer by company, and company should take back the investments.The article uses case study method and concentrates in analysis of XMDG4S SHOP based on the marketing strategy theory of SUNIL GUPTA and DONALD R.LEHMANN. We analyze present marketing strategy and problems of XMDG4S SHOP. The article concludes that limitation exists in the present marketing strategy and it should be transformed into new marketing strategy based on customer lifetime value.In the end, we estimate the customer lifetime value of XMDG4S SHOP by the valuation model of SUNIL GUPTA and DONALD R.LEHMANN, and detailed application of new marketing strategy in XMDG4S SHOP.