On the Integration of Customer Lifetime Value into Revenue Management
This paper provides insights into assessing customer relationships in a revenue management environment and depicts methodological problems that may arise in this context. For this purpose, we formulate a multi-period deterministic linear programing model, which accounts for customers’ future demand behavior being dependent on the provider’s previous availability decisions. Moreover, on the basis of an illustrative example, we investigate the impact on the control policy of a traditional deterministic linear program when both the product-related revenue and the previously developed long-term profitability measure are considered.
KeywordsCustomer Relationship Management Revenue Management Customer Segment Customer Lifetime Value Customer Class
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