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Customer Equity: Measurement, Management and Research Opportunities

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  • Villanueva, Julian
  • Hanssens, Dominique M.

Abstract

Despite the recent academic interest in the study of customer equity (CE henceforth), a comprehensive discussion of the prevailing research issues has not been provided. There is a shift in the interest of managers and researchers from a traditional focus on product management to a more recent focus on customer relationship management (CRM). We believe that research on CE could provide the necessary tools to link CRM to long-term financial performance. In this paper, we (a) discuss the academic and strategic importance of CE, (b) provide an extensive literature review, and (c) prioritize future research. We argue that there are two major agendas for future research in CE. The first is to provide better measures (e.g. the measurement of customer lifetime value), and the second is to identify the strategies that lead to CE maximization. We emphasize modeling approaches that have been used or could be used to tackle the suggested research questions. A special focus is given to statistical models that are capable of incorporating long-run dynamics.

Suggested Citation

  • Villanueva, Julian & Hanssens, Dominique M., 2007. "Customer Equity: Measurement, Management and Research Opportunities," Foundations and Trends(R) in Marketing, now publishers, vol. 1(1), pages 1-95, March.
  • Handle: RePEc:now:fntmkt:1700000002
    DOI: 10.1561/1700000002
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    Citations

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    Cited by:

    1. Nadine Losch & Klaus Möller & Benjamin Quaiser & Sophie Bortfeldt, 2013. "Konzeption und Umsetzung einer Customer Lifetime Value-Berechnung am Beispiel der Luftfahrtindustrie," Schmalenbach Journal of Business Research, Springer, vol. 65(3), pages 274-301, May.
    2. Chen, Yanyan & Mandler, Timo & Meyer-Waarden, Lars, 2021. "Three decades of research on loyalty programs: A literature review and future research agenda," Journal of Business Research, Elsevier, vol. 124(C), pages 179-197.
    3. de Oliveira, Marta Olivia Rovedder & Silveira, Cleo Schmitt & Luce, Fernando Bins, 2015. "Brand equity estimation model," Journal of Business Research, Elsevier, vol. 68(12), pages 2560-2568.
    4. Peter Zubcsek & Miklos Sarvary, 2011. "Advertising to a social network," Quantitative Marketing and Economics (QME), Springer, vol. 9(1), pages 71-107, March.
    5. Yi-Lin Tsai & Elisabeth Honka, 2021. "Informational and Noninformational Advertising Content," Marketing Science, INFORMS, vol. 40(6), pages 1030-1058, November.
    6. Kaifu Zhang & Theodoros Evgeniou & V. Padmanabhan & Emile Richard, 2012. "Content Contributor Management and Network Effects in a UGC Environment," Marketing Science, INFORMS, vol. 31(3), pages 433-447, May.
    7. Silveira, Cleo Schmitt & de Oliveira, Marta Olivia Rovedder & Luce, Fernando Bins, 2012. "Customer equity and market value: Two methods, same results?," Journal of Business Research, Elsevier, vol. 65(12), pages 1752-1758.
    8. Song, Tae Ho & Kim, Sang Yong & Kim, Ji Yoon, 2016. "The dynamic effect of customer equity across firm growth: The case of small and medium-sized online retailers," Journal of Business Research, Elsevier, vol. 69(9), pages 3755-3764.
    9. Markus Moritz1 & Sonja Keppler, 2014. "Customer Equity In A Network Driven Context - Contributions For Evaluating Customer Equity," Interdisciplinary Management Research, Josip Juraj Strossmayer University of Osijek, Faculty of Economics, Croatia, vol. 10, pages 275-284.
    10. Sunil Mithas & M. S. Krishnan & Claes Fornell, 2016. "Research Note—Information Technology, Customer Satisfaction, and Profit: Theory and Evidence," Information Systems Research, INFORMS, vol. 27(1), pages 166-181, March.
    11. Wiesel, Thorsten & Skiera, Bernd & Villanueva, Julian, 2011. "Customer Lifetime Value and Customer Equity Models Using Company-reported Summary Data," Journal of Interactive Marketing, Elsevier, vol. 25(1), pages 20-22.
    12. Zeeshan Ullah, 2023. "The determinants and performance outcome of the firm's capacity to maintain customer loyalty," Sustainable Development, John Wiley & Sons, Ltd., vol. 31(1), pages 265-279, February.
    13. Valentini, Tony & Roederer, Claire & Castéran, Herbert, 2024. "From redesign to revenue: Measuring the effects of servicescape remodeling on customer lifetime value," Journal of Retailing and Consumer Services, Elsevier, vol. 77(C).

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