n International Retail and Marketing Review - Customer equity : an integral part of financial reporting
|Article Title||Customer equity : an integral part of financial reporting|
|© Publisher:||MC Cant|
|Journal||International Retail and Marketing Review|
|Author||Wiesel Thorsten, Skiera Bernd and Villanueva Julian|
|Publication Date||May 2010|
|Pages||29 - 50|
|Keyword(s)||Customer equity, Customer lifetime value, Decomposition, Financial reporting, IESE Business School, Johann Wolfgang Goethe University Frankfurt/Main and Vrije Universiteit Amsterdam|
Recent initiatives demand information that supplements and complements a firm's financial statements to bridge the gap between financial statement capabilities and financial reporting objectives. Such information assists investors' decision making by explaining the main trends and factors that underlie the development, performance, and position of the firm's business. Firms that aim to increase the value of their customer base should report forward-looking customer metrics, because such reports align customer management with corporate goals and investors' perspectives. The authors propose a means to report customer equity that enables investors (as the "consumers" of financial reports) to monitor firms' performance with respect to their customer assets. Furthermore, they develop a specific model for Netflix.com and apply it to quarterly data from September 2001 to September 2006.
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