Customer Equity Management—Managing Customers As Assets

The focus on new products development and brand-based strategies has led many companies to overlook the fact that, ultimately, revenues come from customers. Contrary to this practice, the concept of Customer Equity has been introduced in the marketing literature in order to highlight the significance of customers and customer relations for company performance. In short, the customer equity theory views customers as the company's most important asset and Marketing has the responsibility is to manage these assets in order to maximize customer lifetime value. This in turn allows management to directly link marketing activities with cash flows and profitability. Hence, there is a need for a customer-centric framework in order to enhance the companies' competitiveness through the management of customer equity based on the principals of portfolio analysis and management. The text provides comprehensive and practical coverage of: (1) the concept of customer equity and portfolio management, (2) the actions necessary to improve customer behavioral outcomes and improve cash flow and profitability (3) the criteria and metrics required to evaluate marketing initiatives and performance. Detailed, how-to chapters follow, addressing concepts as well as practices concerning successful customer equity management. Each chapter is supported by practical examples so as to offer a simple, easy to understand however scientifically reliable, guide on how a customer portfolio should be managed. The book is suitable for undergraduate and postgraduate students of business studies as well as marketers, senior executives and managers who seek ways to create and sustain successful relationships with the most attractive customers and, as a result, improve the company's competitive position.