Budget allocation for customer acquisition and retention while balancing market share growth and customer equity

摘要: Following the Blattberg and Deighton (BD) model, we incorporate market share growth to explore links between acquisition retention. We then devise a method for nonlinear programming using spreadsheet balance objectives of in short term customer equity long term. The aim this approach is determine optimal spending allocation retention and, by applying numerical example used original BD these objectives. demonstrate that differential unit cost marginal effects, ceiling rate, efficiency, on achieve can maximize equity. also develop criterion help firms decide where place emphasis, is, retaining existing customers or gaining new ones, while keeping firmly mind.