The lifetime value concept. Its uses for relationship building

Eelko K.R.E. Huizingh and Janny C. Hoekstra

The significance of relationships with customers has received strong emphasis in recent marketing literature.

The lifetime value concept. Its use for relationship building

Janny C. HoekstraErasmus University, University of Groningen, The Netherlands andEelko K.R.E. HuizinghUniversity of Groningen, The Netherlands

INTRODUCTION

The significance of relationships with customers has received strong emphasis in recent marketing literature (e.g. Gundlach and Murphy 1993, Morgan and Hunt 1994, Webster 1992). The focus of marketing has shifted from transactions to relationships. A relationship between two parties is broadly defined as a situation in which their two chains of events are, to some degree and in some manner, causally interconnected (Kelley et al. 1993). This...

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