Non-parametric Estimation of Mean Customer Lifetime Value

  title={Non-parametric Estimation of Mean Customer Lifetime Value},
  author={Phillip E. Pfeifer},
This paper is about how to use data from a random sample of customer relationships to calculate an appropriate average Customer Lifetime Value (CLV). When the sample contains only completed relationships, the simple unweighted average is appropriate. When the sample contains a mix of active and completed relationships, the lifetimes of the active relationships are said to be right censored because the observed lifetime to date is but a lower bound on the eventual lifetime. Because of this… CONTINUE READING

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