Decision Point: Customer Prioritization

With a strategy for the bottom $10\%$ of customers finalized, you turn your attention to the remaining $90\%.$ Using the CLV values that you calculated earlier, you group the customers into segments based on their relative levels of lifetime profitability.

You present your data to the owners in your next meeting to continue the CRM discussion. What are the two most powerful conclusions$/$recommendations you can make based on your CLV findings?

Bar graph representing percentage of total profit contributed by $5$ segments. Bar $1$ shows Segment $1$ representing $10\%$ of the customers which contribute $50\%$ of the profit. Bar $2$ shows Segment $2$ representing $15\%$ of the customers which contribute $32\%$ of the profit. Bar $3$ shows Segment $3$ representing $38\%$ of the customers which contribute $20\%$ of the profit. Bar $4$ shows Segment $4$ representing $27\%$ of the customers which contribute $12\%$ of the profit. Bar $5$ shows Segment $5$ representing $10\%$ of the customers which contribute $-14\%$ of the profit.

Select two options from the choices below and click Submit.

Treat them all the same: All customers have comparable LTVs and therefore should be treated similarly.

Low priority: Segment $4$ should receive only minimal marketing because it represents a large number of consumers but a small amount of profitability.

Growth opportunity: The most significant opportunity for profit growth lies in Segment $3.$

Special treatment: Camp Plus needs to provide the best services and offers to Segments $1$ and $2$ because firm profitability depends on it$.$