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4th
Jul 2016
jeevan-kr
@jeevan-kr
Jul 04 2016 11:20

Folks, have been analyzing customer lifetime value of a firm. Not sure, if I am in the right direct. Appreciate any help.

The problem is as follows:

A customer cohort that started during a particular period, have data on sessions and purchases. Sessions indicate the lifetime and purchases the value derived. Have derived the survival function from Kaplan-Meier curve, and integrated as follows:

Sum ( Rev_t PurchaseProb_t retentionProb_t/discountRate_t)

But, when I calculate the CLV for each customer and total it, it does not add up to total revenue. Any thoughts.