What Do You Really Know About Your Customer Base?

In an excerpt from their book ‘The Customer-Base Audit,’ Peter Fader, Bruce Hardie, and Michael Ross ask critical questions to help you gauge how much you really understand about your customers’ buying behavior.

How Customer Behavior Can Be Used to Value Your Company

When a business has a steady customer base, it’s easy for it to make estimations and projections. But that task is very difficult for companies that are non-contractual, meaning they have customers with inconsistent buying patterns. Wharton marketing professor Peter Fader and Wharton doctoral student Dan McCarthy are looking to close the data gap in their new research paper titled, “Valuing Non-Contractual Firms Using Common … [ Read more ]

Peter Fader

Companies are being overly responsive. They’re listening to every tweet and every Facebook post and basically saying, “The customer is always right; what are we going to do?” I’m all in favor of discrimination in the marketplace. Let’s give extra attention to the high-value customers. The other ones … have to live with it. It’s very important for a company to focus on the right … [ Read more ]

Which Customers Are Worth Keeping and Which Ones Aren’t? Managerial Uses of CLV

Managers have long been interested in weeding out customers they consider to be less profitable than others. The question is, how do managers determine who belongs in that group? According to several Wharton marketing professors, there is no easy answer, despite new and increasingly sophisticated efforts to measure what is called “Customer Lifetime Value” (CLV) – the present value of the likely future income stream … [ Read more ]

Hit and Miss: Why High Traffic Streams Need not Lead to More Online Business

If your web store is getting zillions of hits a month, business must be skyrocketing, right? Not necessarily. Many online retailers monitor visitor traffic as a measure of their stores’ success. But in a study they assert is one of the first in-depth analyses of online visiting behavior using Internet clickstream data, two Wharton researchers explain why high traffic streams to a website need not … [ Read more ]