Understanding Net Present Value vs. Lifetime Value

Reading a LinkedIn article I came across the term Net Present Value (NPV). Wikipedia describes NPV as “the present value of money today compared to the present value of money in future, taking inflation and returns into account.” It’s However, I found the writer, Sallie Krawcheck’s, personal explanation more thought provoking: “the willingness to forgo earnings today, to invest smartly for more earnings tomorrow.”

Instead of applying to finances, economics and accounting, I started to think how NPV can be applied to marketing and customer relationship building. As marketers, we’ve been programmed to calculate something similar called a Customer’s Lifetime Value (LTV), the predicted net profit for the entire future relationship of the customer…but what about a prospect’s Net Present Value? Are they even worth acquiring? In the years to come, will they be worth more or less than they are right now?

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Understanding Net Present Value vs. Lifetime Value

Net Present Value

Reading a LinkedIn article I came across the term Net Present Value (NPV).  Wikipedia describes NPV as “the present value of money today compared to the present value of money in future, taking inflation and returns into account.” It’s However, I found the writer, Sallie Krawcheck’s, personal explanation more thought provoking: “the willingness to forgo earnings today, to invest smartly for more earnings tomorrow.”

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Push vs. Pull Marketing, and “New” Media

 During the holiday season we will be looking back to our best blog posts of the year. Here is number 4.

Number 3!

Push vs Pull Marketing

Crack open any Marketing 101 textbook and you’re likely to find a passage on Push Marketing and Pull Marketing. These are the two basic physics of marketing and they each form the approach for Branding and Direct Response, respectively.Read more


Big Brother Is “Micro-Targeting” You

Written by Kim Chapman - Account Executive

Political parties have been using marketing tactics for as long politics have existed. After all, isn’t a political campaign the act of marketing yourself to your audience?

One really smart way that parties have been marketing themselves in recent years is through the use of micro-targeting. Essentially, this is a fancy word for political parties using data to market at a more targeted level.

A lot of this work is done by campaign consultant groups. Not only are these groups collecting consumer data from data-housing companies, they are also merging this data with voter registration records. These records include important information: whether someone is a registered voter, with what party they are registered, and how often they have voted in past elections.

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