What would the total Customer Lifetime Value using these calculations?

Written Assignment One-Pager: Customer Lifetime Value Worksheet

Let’s look at the ‘Customer Lifetime Value’ marketing concept. We’ll use the following hypothetical scenario to calculate the total expenditure for auto insurance. Try not to overthink here, just calculate the numbers… monthly cost times number of months times total number of years (previous & future):

  • Monthly cost = $130
  • Number of previous years = 15
  • Number of future years = 35

Prepare a one-page analysis (approximately 75-100 words) based on the following two questions:

  1. What would the total Customer Lifetime Value using these calculations? (show your worksheet)
  2. Why should all of a firm’s departments understand the impact of this strategy?



Written Assignment One Pager: B-to-B vs B-to-C marketing

Consider some of the consumer behavior topics for business-to-consumer (B-to-C) marketing from Chapter 6. How might you apply them to business-to-business (B-to-B) settings? For example, how might non-compensatory models of choice work?

You are expected to incorporate specific marketing terminologies from the text in your responses.


Chapter Notes


Organizational buying is the decision-making process by which formal organizations establish the need for purchased products and services, then identify, evaluate, and choose among alternative brands and suppliers. The business market consists of all the organizations that acquire goods and services used in the production of other products or services that are sold, rented, or supplied to others. Compared with consumer markets, business markets generally have fewer and larger buyers, a closer customer supplier relationship, and more geographically concentrated buyers. Demand in the business market is derived from demand in the consumer market and fluctuates with the business cycle. Nonetheless, the total demand for many business goods and services is quite price inelastic. Business marketers need to be aware of the role of professional purchasers and their influencers, the need for multiple sales calls, and the importance of direct purchasing, reciprocity, and leasing.

The buying center is the decision-making unit of a buying organization. It consists of initiators, users, influencers, deciders, approvers, buyers, and gatekeepers. To influence these parties, marketers must consider environmental, organizational, interpersonal, and individual factors. The buying process consists of eight stages called buyphases: (1) problem recognition, (2) general need description, (3) product specification, (4) supplier search, (5) proposal solicitation, (6) supplier selection, (7) order-routine specification, and (8) performance review. Business marketers are strengthening their brands and using technology and other communication tools to develop effective marketing programs. They are also using systems selling and adding services to provide customers added value. Business marketers must form strong bonds and relationships with their customers. Some customers, however, may prefer a transactional relationship. The institutional market consists of schools, hospitals, nursing homes, prisons, and other institutions that provide goods and services to people in their care. Buyers for government organizations tend to require a great deal of paperwork from their vendors and to favor open bidding and domestic companies. Suppliers must be prepared to adapt their offers to the special needs and procedures found in institutional and government markets.


Despite shifting borders, unstable governments, foreign-exchange problems, corruption, and technological pirating, companies selling in global industries need to internationalize their operations. Upon deciding to go abroad, a company needs to define its international marketing objectives and policies. It must determine whether to market in a few or many countries and rate candidate countries on three criteria: market attractiveness, risk, and competitive advantage. Developing countries offer a unique set of opportunities and risks. The “BRICS” countries—Brazil, Russia, India, China, and South Africa—plus other significant markets such as Indonesia are a top priority for many firms.

Modes of entry are indirect exporting, direct exporting, licensing, joint ventures, and direct investment. Each succeeding strategy entails more commitment, risk, control, and profit potential. In deciding how much to adapt their marketing programs at the product level, firms can pursue a strategy of straight extension, product adaptation, or product invention. At the communication level, they may choose communication adaptation or dual adaptation. At the price level, firms may encounter price escalation, dumping, gray markets, and discounted counterfeit products. At the distribution level, firms need to take a whole-channel view of distributing products to the final users. Firms must always consider the cultural, social, political, technological, environmental, and legal limitations they face in other countries. Country-of-origin perceptions can affect consumers and businesses alike. Managing those perceptions to best advantage is a marketing priority.

Chapter Notes


To develop an effective positioning, a company must study competitors as well as actual and potential customers. Marketers need to identify competitors’ strategies, objectives, strengths, and weaknesses. Developing a positioning requires identifying a frame of reference—by locating the target market and the nature of the competition—and the optimal points-of-parity and points-of-difference brand associations. A company’s closest competitors are those seeking to satisfy the same customers and needs and making similar offers. A company should also pay attention to latent competitors, who may offer new or different ways to satisfy the same needs. Industry- and market-based analyses both help uncover competitors.

Points-of-difference are those associations unique to the brand that are also strongly held and favorably evaluated by consumers. These differences may be based directly on the product or service itself or on other considerations related to employees, channels, image, or services. Points-of-difference must be desirable (from a consumer standpoint), deliverable (from a company standpoint), and differentiated (from a competitor standpoint).

Points-of-parity are those associations not necessarily unique to the brand but perhaps shared with other brands. They help to negate any potential weaknesses for the brand. Category point-of-parity are associations consumers view as being necessary to a legitimate and credible product offering within a certain category. Correlational points-of-parity are associations designed to overcome perceived weaknesses or vulnerabilities of the brand. Competitive point-of-parity are associations designed to negate competitors’ points-of-difference. Emotional branding is becoming an important way to connect with customers and create differentiation from competitors. Emotional differences are often most powerful when they are connected to underlying functional differences. Several different alternative approaches exist to position a product or service. These less structured, more qualitative approaches are based on concepts such as brand narratives and storytelling, brand journalism, and cultural branding. Although small businesses should adhere to many of the branding and positioning principles larger companies use, they must place extra emphasis on their brand elements and secondary associations, be more focused, and create buzz for their brand.


A brand is a name, term, sign, symbol, design, or some combination of these elements, intended to identify the goods and services of one seller or group of sellers and to differentiate them from those of competitors. The different components of a brand—brand names, logos, symbols, package designs, and so on—are called brand elements. Brands are valuable intangible assets that offer a number of benefits to customers and firms and need to be managed carefully. The key to branding is that consumers perceive differences among brands in a product category. Brand equity should be defined in terms of marketing effects uniquely attributable to a brand. That is, different outcomes result when a product or service is marketed under its brand than when it is not. Building brand equity depends on three main factors: (1) The initial choices for the brand elements or identities making up the brand; (2) the way the brand is integrated into the supporting marketing program; and (3) the associations indirectly transferred to the brand by links to some other entity (the company, country of origin, channel of distribution, or another brand).

Brand audits measure “where the brand has been,” and tracking studies measure “where the brand is now” and whether marketing programs are having the intended effects. A branding strategy identifies which brand elements a firm chooses to apply across the various products it sells. In a brand extension, a firm uses an established brand name to introduce a new product. Potential extensions must be judged by how effectively they leverage existing brand equity to a new product, as well as how effectively they contribute to the equity of the parent brand in turn. Brands may expand coverage, provide protection, extend an image, or fulfill a variety of other roles for the firm. Each brand-name product must have a well-defined positioning to maximize coverage, minimize overlap, and thus optimize the portfolio. Customer equity is a concept that is complementary to brand equity and reflects the sum of lifetime values of all customers for a brand.



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