Maximizing customer lifetime value through strategic channel management: How to incentivize customers to use apps versus websites

Gecer, Gökhan ; Kraus, Florian ; Stahl, Florian

Document Type: Conference or workshop publication
Year of publication: 2018
Book title: 40th Annual ISMS Marketing Science Conference 2018 : Technical Session listing
Page range: 101
Conference title: 40th Annual ISMS Marketing Science Conference
Location of the conference venue: Philadelphia, PA
Date of the conference: 13.-16.06.2018
Place of publication: Catonsville, MD
Publishing house: INFORMS
Publication language: English
Institution: Business School > Dr. Werner Jackstädt Stiftungslehrstuhl für ABWL u. Marketing IV (Kraus)
Business School > ABWL, Quantitatives Marketing (Stahl 2013-)
Subject: 330 Economics
Abstract: The mobile channel is different from other channels since at least one of the engaged parties isn’t at a fixed location and these parties can communicate at any time. The unique nature of mobile devices leads customers to develop habitual interactions with firms and as a result, the customer lifetime value (CLV) of mobile channel users tends to become larger than the CLV of other channel users. One of the main reasons is that users’ order rates increase when they adapt to mobile apps, resulting in a higher net monetary value in total spending. Consequently, online retailers should encourage the customers to switch to mobile devices by offering a discount over mobile apps. The purpose of this article is to develop a modeling approach to answer the research questions below and test the proposed model in a field experiment conducted with a commercial website. (1) To what type of customer should a discount over the mobile app be offered? (2) What is the optimal discount rate? Firstly, we conducted an experiment to test the assumptions used for constructing the analytical model. In the model, we apply to discounted expected transactions (DET) to calculate the CLV of a customer. It is based on the customer purchasing probabilities over different sales channels.

Dieser Eintrag ist Teil der Universitätsbibliographie.

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