ABC Corp is an online retail store that wants to calculate the customer lifetime value (CLV) of
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Question:
ABC Corp is an online retail store that wants to calculate the customer lifetime value (CLV) of its customers. The company has been in business for four years and has the following data:
- Average order value (AOV): $50
- Average purchase frequency (APF): 5 purchases per year
- Gross profit margin (GPM): 40%
- Customer acquisition cost (CAC): $150
- Average customer lifespan (CLS): 2 years
Using this information, calculate the customer lifetime value for ABC Corp.
(Show all calculations and round to two decimal places)
Related Book For
Cost management a strategic approach
ISBN: 978-0073526942
5th edition
Authors: Edward J. Blocher, David E. Stout, Gary Cokins
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