Dating a geek tips
I’ve been exposed to some fairly daunting business math in my day, and if I had been shown the last formula out of context I wouldn’t have known if it was designed to calculate Customer Lifetime Value or the quantization of energy. Whether due to budgetary, time, or data constraints, sometimes the back of the napkin is all we have.Yet sometimes the back of the napkin is good enough.Here are three examples of CLV calculations from the academic literature.While anyone with a graduate course in finance or statistics can probably hack their way through the first two formulas, the third looks like something pulled off one of the whiteboards from the set of The Big Bang Theory. While it is wise to be cautious about using nonscientific evidence for analysis, often statistically sound approaches are not feasible.
Calculating marginal profit is simple in many industries.They are paying the staff whether that cup of coffee is purchased or not. Labor would be included, however, if labor costs vary based on whether a service is performed or a product is sold.For instance, maid services that pay only per job or spas that pay per service performed.Customer Lifetime Value (CLV) attempts to determine the economic value a customer brings over their “lifetime” with the business.At the heart of understanding CLV lies the recognition that a customer does not represent a single transaction but a relationship that is far more valuable than any one-time exchange.