What is Customer Equity in Marketing?

Learn Customer Equity definition in marketing with explanation to study “What is Customer Equity”. Study customer equity explanation with marketing terms to review marketing course for online MBA programs.

Customer Equity Definitions

  1. Total combined customer lifetime values of all of the company's customers.

    Principles of Marketing by Philip T. Kotler, Gary Armstrong



  2. Sum of lifetime values of all customers.

    Principles of Marketing by Philip T. Kotler, Gary Armstrong



Customer Equity Explanation

Customer equity is the output of customer's feedback. This relationship is usually developed on the bases of brand recognition. Customer loyalty is associated with the brand on the bases of product quality. Companies' offer discount to their loyal customers. For example, Nestle, Procter and Gamble, and Pepsi have high level of customer equity. Therefore, company having high level of customer equity, considered as higher in market, whereas, low customer equity will be ranked lower in the competitive market.

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