Which of the following is false with regard to customer lifetime value?
A)It is a key measurement that forecasts a customer's lifetime economic contribution based on continued relationship marketing efforts.
B)It can be calculated by taking the sum of the customer's present value contributions to profit margins over a specific time frame.
C)It includes not only an individual's propensity to engage in purchases but also his or her strong word-of-mouth communication about the firm's products.
D)All customers have equal value to a firm.
E)It is the only gauge that incorporates revenue, expense and customer behaviour, and adopts a customer-centric approach.

Question

Quizplus · Accepted Answer

All customers do not have equal value to a firm. Some customers may generate more revenue and profits than others, while some may cost the firm more in terms of acquisition and retention expenses. Therefore, it is important for firms to identify their most valuable customers and create targeted marketing initiatives to retain them.

Which of the Following Is False with Regard to Customer