Consumers profitability is some thing that keeps bothering brands. Companies try to acquire the most profitable customer so that hey have better profits. after all profit is what they want. Acquiring a customer has always been expensive for many brands. As these brands , start to quantify value of the customer they acquire its important to understand a concept called – Customer Value Measurement.
Please understand Customers tent to be more profitable over a period of time. so during the first year your Acquisition cost will be more than the the revenue generated. This is natural as customer tends to be cautious while using and trying out your brand and compare it with others that it might be using now or might be willing to use soon. As you tend to get a bit of inclination from customers towards your brand they tend to add value to the revenue. As the time moves (would say customers life time ) customer gets more familiar to your brands and starts loving it. This is when your year on year revenue starts increasing.
