Posted on 11/09/2019 11:37:31 AM PST by bgill
If you have ever owned a smartphone, shopped online, bought an airline ticket or used a credit card, you are being secretly scored in ways that can impact your wallet. The scorers are businesses we buy products and services from every day.
They are called Customer Lifetime Value or CLV scores. All sorts of retailers and businesses use them to judge our value as consumers...
most businesses will not tell you what your score is. “It’s not your right as a consumer right now,” Thomas said. “Nobody has legislated that it’s your right to see it and to have input into it like they have other scores like your credit score.”...
Some compare the use of CLV scores to China’s developing social credit system that scores people’s reputations on their good and bad deeds... A key difference is that China’s social credit system is government-run and people know where they stand — good or bad. In America, consumers are tracked and scored by private companies who don’t share that score.
(Excerpt) Read more at ksl.com ...
I have been watching corporate marketing departments do this for YEARS. This is nothing new.
Still, no matter what the marketing departments do, they cannot MAKE you buy a product.
That is what was so damnable about the ACA and what is so wrong about Medicare for All ... the forced purchase.
Marketing is invasive and insidious. Fear and hate are two basic marketing themes. Marketing is far more effective than people realize at selling products and ideas.
At its most basic marketing exploits human nature.
I agree that it exploits, but it cannot force someone to do something they didn’t want to do.
What is ksl?
What are they claiming these scores do?
Seems more like Vegas: be a big spender (and lose a lot!), they’ll put you in a nice room for cheap with lots of perks.
The original Wall Street Journal article this was probably plagiarized from.
In short, some customers are valuable (generate a lot of orders) others are of negative value (do a lot of returns relative to orders, spend a lot of time complaining to “customer service”). Customers who are of negative value do not get much effort expended to keep them happy — the company WANTS them to shop elsewhere and be some other merchant’s negative-value pain-in-the-butt.
KSL.com = Salt Lake City, Utah news
“Marketing is invasive and insidious. Fear and hate are two basic marketing themes. Marketing is far more effective than people realize at selling products and ideas.”
“At its most basic marketing exploits human nature.”
Invasive? You mean you can’t turn away from it, or mute the TV or change the channel?
Like the man said, no one put a gun to your head.
CLV = Customer Lifetime Value:
When the left wing board member idiots chase away fans/customers/buyers to promote Social Justice Warfare/Welfare BS, often those customers will stay away for their lifetime.
P&G, Nike, pro football and fill in the blank_______________ have ended their relationship with millions of Deplorables customers with their Justice Warfare BS marketing.
These idiots depending on the millennials to bail them out, may be even more stupid than pushing SJW BS.
CLV aka Customer Lifetime Value:
The model for customer cash flows treats the firm’s customer relationships as something of a leaky bucket. Each period, a fraction (1 less the retention rate) of the firm’s customers leave and are lost for good.[1]
The CLV model has only three parameters: (1) constant margin (contribution after deducting variable costs including retention spending) per period, (2) constant retention probability per period, and (3) discount rate. Furthermore, the model assumes that in the event that the customer is not retained, they are lost for good.
Customer Lifetime Value:
https://en.wikipedia.org/wiki/Customer_lifetime_value
I don't know ... the announcer for the Philadelphia Flyers has a mustache that looks exactly like the Cisco "bridge" logo. I told my daughter that I think he has a contract with Cisco to trim it that way. Which is fine, but what am I going to do with all these routers?
The Pareto principle (also known as the 80/20 rule in action):
The smart side, 20% of your customers create 80% of your business.
On the flip side, 80% of your problems are caused by 20% of your customers.
Invasive in that it’s everywhere besides the obvious media outlets.
Sure it’s everywhere, but still, no one is forcing anyone to spend their money. There will always be gullible fools.
Natural Selection is always in play.
I said products and ideas.
Ever see a package that says “new packaging same great product” in the very fine print? Have you every wondered how many bought the product that had tried it once years ago and mistakenly thought the product changed because the packaging was different?
Personally I think they are missing a parameter. There is an buried assumption reflected in either the margin or the retention that assumes an individual will not ‘shop around’ for the same product and service every time they need it.
For example: I buy Folgers coffee and I drink about 1 red bucket every month. However, I will buy multiples of those red buckets every time I see a sale that is about a $1 below the standard price combined with a coupon - WHEREVER it is advertised. In this locale it’s either: CVS, Walgreens, Giant Eagle, Marcs, Heinen’s, Walmart, or Target that typically have those sales.
Thus the retailers, provided they aren’t breaking the law and violating anti-trust through coordinating sales price/timing and customer data, cannot predict accurately what my retention and/or margin will be.
They can predict the lemmings who do 100% of their shopping in one place all the time independent of price - but they don’t need to worry about them and the calculation isn’t meant for them. They rarely complain and don’t require retention.
Yep, this was commonplace at companies I worked at, too, but those were B2B companies, not consumer goods and services companies.
But the use of CLV was obvious with airline frequent flier programs. Million mile customers always got better service and perks than the guy who flew one hop per year.
The sales guys who I supported always spent a lot more time with the high CLV companies. No surprise there. If you were in sales and NOT doing that, you weren’t going to make your number and would find yourself out on the street after a few quarters.
What’s different these days is the huge variety of tools available to companies to track your purchases and calculate your lifetime value to them.
I’m sure Amazon has scored the POF family very high.
I guess I’m dense...I don’t get it.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.