MBA Open Lecture: Valuing Customers
On Thursday, May 25th, Dr. Prashanth Nyer, Associate Professor of Marketing at Chapman University with rich experience in practice answered the following and similar questions, and discussed daily examples and challenges:
- How much time, money and effort should a business spend to retain a customer who might otherwise defect to a competitor?
- How much is an average customer of your business worth to you over his or her lifetime as a customer of your business?
Through calculation of acquisition costs and revenue, each visitor was encouraged to calculate the customer lifetime value. As almost all marketing departments need to decide how to allocate their limited resources, these calculations are essential in ensuring that businesses stay profitable. After examining a typical scenario, we realized that not all customers are worth the same, and that we should identify the most profitable customers and nurture them. Ironically, the most profitable customers are not always the biggest ones.
Since many potential applicants to the Chapman University MBA program in Prague were in attendance at the Open lecture, Dr. Nyer also presented a brief introduction of our MBA program, and he discussed how his MBA course Marketing Management, and other courses in the program, are structured to create a learning oriented environment that is focused on honing practical decision making skills for business leaders.
About the lecturer: Dr. Prashanth Nyer has been a professor of Marketing at Chapman University for 23 years and has been teaching the MBA program at AAU since its inception. Nyer holds a bachelor’s degree in electrical engineering and a master’s and Ph.D. (University of Michigan, Ann Arbor; 1994) in business administration. His research focus is on consumer satisfaction and other aspects of consumer behavior including attitude change, public commitment, and cross-cultural differences in consumer behavior. Nyer’s research has been published in various journals and he has worked in product management in the consumer products and industrial electronics industries.