A key input variable in many marketing models of customer loyalty is the:
A) Mean profit per customer
B) Number of customers
C) Churn rate
D) Time horizon

Question

A key input variable in many marketing models of customer loyalty is the:
A) Mean profit per customer 
B) Number of customers 
C) Churn rate 
D) Time horizon

Quizplus · Accepted Answer

The churn rate, or the rate at which customers stop doing business with a company, is a key input variable in models of customer loyalty. Knowing how frequently customers are leaving allows marketers to develop strategies for retaining those customers and improving loyalty. Mean profit per customer and number of customers are important variables, but they do not necessarily contribute to understanding customer loyalty. Time horizon may also be useful in some cases, but it is not as universally applicable as churn rate.

A Key Input Variable in Many Marketing Models of Customer