Measuring Customer Acquisition Value: A Comprehensive Approach to Customer Equity

Subject Areas : Business Strategy

Monireh Hosseini ¹ , Farnoush Firouzi ²

1 - K. N. Toosi University of Technology, Tehran, Iran
2 - K. N. Toosi University of Technology, Tehran, Iran

Received: 2014-09-01 Accepted : 2014-11-01 Published : 2015-10-01

Keywords: Customer acquisition, customer equity, value measurement, database marketing,

Abstract :

In information technology era, databases are known asone of the most valuable resources for organizations, especially usedin database marketing. Customer Equity is a key concept in DatabaseMarketing which integrates customer acquisition, retention and development.From the perspective of customer equity, customers are theprimary source of both current and future cash-flows. Customer equitymodels emerge as powerful tools to maximize the return on marketinginvestments, and to guide the allocation of the marketing budget. Becauseof the importance of customer acquisition as a key dimensionof customer equity, this paper focused on the measurement of customeracquisition value. By studying different research papers on customer acquisitionand comparing them, we address the gaps especially in quantifyingthe customer equity and propose some suggestions for more comprehensiveassessment of acquisition value.