About Us
Fulcrum is a brand activations company specialising in below the line campaigns, special events and other field marketing activities. Established in 2007, we have extensive experience in our field and count amongst our points of difference the following.
We do this by creating moments in popular malls, colleges, bus stops, multiplexes, stores and events right into cherished moments in a customers life.
Our vision is to empower brands & corporates to communicate primarily through the medium of experience & innovation.
We believe in the sales of our clients products/services, sales supported by brand visibility, awareness and execution of the products message with a promotional objective.
Recently a client asked us to propose on building a customer lifetime value model. This wasnt unusual, weve built this kind of model dozens of times, but in the last couple of years we havent done as many stand-alone CLV projects and I stopped to think about why that was.
Recently a client asked us to propose on building a customer lifetime value model. This wasnt unusual, weve built this kind of model dozens of times, but in the last couple of years we havent done as many stand-alone CLV projects and I stopped to think about why that was.
Understanding Customer Value
First of all, despite the glowing articles of a couple of years back saying its really quite easy and it can drive your whole strategy weve learned the opposite is really true. Figuring out the revenue side of the customer value equation is usually pretty straightforward, its the cost side that can really be a stinker. Marketers who arent traditional direct marketers dont naturally calculate the cost to acquire a new customer, and figuring out the cost of goods and the cost to serve requires input and buy-in from parts of the organization far, far from the marketing team. Finance usually must get involved and cans of worms can often be opened!
Another critical component of the value of a customer is the length of the customer relationship. We are always surprised when we do retention analytics at how difficult it is for many marketers to really understand customer retention and attrition in a detailed way. Given the old saw that its easier to keep a customer than find a new one you might think that monitoring and understanding retention rates would be a top KPI but without a good customer database, its pretty hard to track with precision.
So Customer Lifetime Value isnt so easy without the right data, tools and know how. But it is still pretty important to understand who your best customers might be or those who could become top customers with a little love. And deciding how much to spend to acquire new customers is difficult if you dont have a long term view of your customers potential profitability.
If you have all the data, and buy in from Finance to help you figure out the cost side great! If not, well look at the relative performance of different customer segments and create some algorithms that will allow us to rank customers in terms of their likelihood to be high or low value. Of course, more data over time will get us closer to a more precise estimation.
But why dont we do too many standalone CLV efforts? I think because we now bake customer value into so many other analytical efforts to fine tune messaging and sales efforts. A customer value estimate might become one component in an acquisition or retention model. Or, well include customer value in a segmentation scheme along with demographics and lifestyle components.
Today, predicted customer value is less often the end game, and more often one more piece of smart data that can work with a wide number of other elements to help us deliver the right messages and offers to prospects and customers in direct mail, email, digital ad targeting and in the sales process. CLV is one tool in a whole tool box and if it is too difficult to create the perfect equation because of lack of data or internal politics, well create a rough estimate and use it with other smart data to help make the most of the customers experience with our clients brands.
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