Customer Loyalty Analysis Using Customer Lifetime Value (A Case Study of Baby Equipment SMEs)

M. Dachyar; Lidya Vitasya

Customer Loyalty Analysis Using Customer Lifetime Value (A Case Study of Baby Equipment SMEs)

M. Dachyar, Lidya Vitasya

Department of Industrial Engineering

Research output: Chapter in Book/Report/Conference proceeding › Conference contribution › peer-review

Abstract

The increase number of births in Indonesia during the pandemic era provided opportunities for baby equipment businesses. At the same time, online purchase transactions have also increased. This research objective is to determine the segmentation and worth of each customer segment using Customer Lifetime Value (CLV) and develop strategies for every customer segmentation in order to increase the value of business competitiveness. The K-Means Clustering method is applied to segment clients into a few clusters and the CLV value is used to specify the value of each customer segment with the RFM variable. Cluster deployment using Customer Value Matrix (CVM) is also carried out to ensure cluster characteristics. Secondary data is obtained from sales transactions. Analysis of product sales is carried out using the Association Rules method that results in one of the strategies in Customer Development. The research resulted in 5 clusters for customers with 16 strategies for the whole cluster. Cross-selling strategy is the most recommended strategy.

Original language	English
Title of host publication	Proceedings - 4th European Rome Conference 2021
Editors	Mario Fargnoli, Mara Lombardi, Massimo Tronci, Patrick Dallasega, Matteo Mario Savino, Francesco Costantino, Giulio Di Gravio, Riccardo Patriarca
Publisher	IEOM Society
Pages	2094-2104
Number of pages	11
ISBN (Print)	9781792361272
Publication status	Published - 2021
Event	4th European International Conference on Industrial Engineering and Operations Management, IEOM 2021 - Virtual, Online Duration: 2 Aug 2021 → 5 Aug 2021

Publication series

Name	Proceedings of the International Conference on Industrial Engineering and Operations Management
ISSN (Electronic)	2169-8767

Conference

Conference	4th European International Conference on Industrial Engineering and Operations Management, IEOM 2021
City	Virtual, Online
Period	2/08/21 → 5/08/21

Keywords

Association Rule
Business Intelligence
Customer Lifetime Value (CLV)
Customer Value Matrix
K-Means Clustering

Cite this

Dachyar, M., & Vitasya, L. (2021). Customer Loyalty Analysis Using Customer Lifetime Value (A Case Study of Baby Equipment SMEs). In M. Fargnoli, M. Lombardi, M. Tronci, P. Dallasega, M. M. Savino, F. Costantino, G. Di Gravio, & R. Patriarca (Eds.), Proceedings - 4th European Rome Conference 2021 (pp. 2094-2104). (Proceedings of the International Conference on Industrial Engineering and Operations Management). IEOM Society.

Dachyar, M. ; Vitasya, Lidya. / Customer Loyalty Analysis Using Customer Lifetime Value (A Case Study of Baby Equipment SMEs). Proceedings - 4th European Rome Conference 2021. editor / Mario Fargnoli ; Mara Lombardi ; Massimo Tronci ; Patrick Dallasega ; Matteo Mario Savino ; Francesco Costantino ; Giulio Di Gravio ; Riccardo Patriarca. IEOM Society, 2021. pp. 2094-2104 (Proceedings of the International Conference on Industrial Engineering and Operations Management).

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title = "Customer Loyalty Analysis Using Customer Lifetime Value (A Case Study of Baby Equipment SMEs)",

abstract = "The increase number of births in Indonesia during the pandemic era provided opportunities for baby equipment businesses. At the same time, online purchase transactions have also increased. This research objective is to determine the segmentation and worth of each customer segment using Customer Lifetime Value (CLV) and develop strategies for every customer segmentation in order to increase the value of business competitiveness. The K-Means Clustering method is applied to segment clients into a few clusters and the CLV value is used to specify the value of each customer segment with the RFM variable. Cluster deployment using Customer Value Matrix (CVM) is also carried out to ensure cluster characteristics. Secondary data is obtained from sales transactions. Analysis of product sales is carried out using the Association Rules method that results in one of the strategies in Customer Development. The research resulted in 5 clusters for customers with 16 strategies for the whole cluster. Cross-selling strategy is the most recommended strategy.",

keywords = "Association Rule, Business Intelligence, Customer Lifetime Value (CLV), Customer Value Matrix, K-Means Clustering",

author = "M. Dachyar and Lidya Vitasya",

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Dachyar, M & Vitasya, L 2021, Customer Loyalty Analysis Using Customer Lifetime Value (A Case Study of Baby Equipment SMEs). in M Fargnoli, M Lombardi, M Tronci, P Dallasega, MM Savino, F Costantino, G Di Gravio & R Patriarca (eds), Proceedings - 4th European Rome Conference 2021. Proceedings of the International Conference on Industrial Engineering and Operations Management, IEOM Society, pp. 2094-2104, 4th European International Conference on Industrial Engineering and Operations Management, IEOM 2021, Virtual, Online, 2/08/21.

Customer Loyalty Analysis Using Customer Lifetime Value (A Case Study of Baby Equipment SMEs). / Dachyar, M.; Vitasya, Lidya.
Proceedings - 4th European Rome Conference 2021. ed. / Mario Fargnoli; Mara Lombardi; Massimo Tronci; Patrick Dallasega; Matteo Mario Savino; Francesco Costantino; Giulio Di Gravio; Riccardo Patriarca. IEOM Society, 2021. p. 2094-2104 (Proceedings of the International Conference on Industrial Engineering and Operations Management).

Research output: Chapter in Book/Report/Conference proceeding › Conference contribution › peer-review

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AU - Vitasya, Lidya

N1 - Publisher Copyright: © IEOM Society International.

PY - 2021

Y1 - 2021

N2 - The increase number of births in Indonesia during the pandemic era provided opportunities for baby equipment businesses. At the same time, online purchase transactions have also increased. This research objective is to determine the segmentation and worth of each customer segment using Customer Lifetime Value (CLV) and develop strategies for every customer segmentation in order to increase the value of business competitiveness. The K-Means Clustering method is applied to segment clients into a few clusters and the CLV value is used to specify the value of each customer segment with the RFM variable. Cluster deployment using Customer Value Matrix (CVM) is also carried out to ensure cluster characteristics. Secondary data is obtained from sales transactions. Analysis of product sales is carried out using the Association Rules method that results in one of the strategies in Customer Development. The research resulted in 5 clusters for customers with 16 strategies for the whole cluster. Cross-selling strategy is the most recommended strategy.

AB - The increase number of births in Indonesia during the pandemic era provided opportunities for baby equipment businesses. At the same time, online purchase transactions have also increased. This research objective is to determine the segmentation and worth of each customer segment using Customer Lifetime Value (CLV) and develop strategies for every customer segmentation in order to increase the value of business competitiveness. The K-Means Clustering method is applied to segment clients into a few clusters and the CLV value is used to specify the value of each customer segment with the RFM variable. Cluster deployment using Customer Value Matrix (CVM) is also carried out to ensure cluster characteristics. Secondary data is obtained from sales transactions. Analysis of product sales is carried out using the Association Rules method that results in one of the strategies in Customer Development. The research resulted in 5 clusters for customers with 16 strategies for the whole cluster. Cross-selling strategy is the most recommended strategy.

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KW - Customer Value Matrix

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T3 - Proceedings of the International Conference on Industrial Engineering and Operations Management

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BT - Proceedings - 4th European Rome Conference 2021

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A2 - Tronci, Massimo

A2 - Dallasega, Patrick

A2 - Savino, Matteo Mario

A2 - Costantino, Francesco

A2 - Di Gravio, Giulio

A2 - Patriarca, Riccardo

PB - IEOM Society

T2 - 4th European International Conference on Industrial Engineering and Operations Management, IEOM 2021

Y2 - 2 August 2021 through 5 August 2021

ER -

Dachyar M, Vitasya L. Customer Loyalty Analysis Using Customer Lifetime Value (A Case Study of Baby Equipment SMEs). In Fargnoli M, Lombardi M, Tronci M, Dallasega P, Savino MM, Costantino F, Di Gravio G, Patriarca R, editors, Proceedings - 4th European Rome Conference 2021. IEOM Society. 2021. p. 2094-2104. (Proceedings of the International Conference on Industrial Engineering and Operations Management).

Customer Loyalty Analysis Using Customer Lifetime Value (A Case Study of Baby Equipment SMEs)

Abstract

Publication series

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Keywords

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