What is the average value of a loyal customer (VLC) in a target market segment if the average purchase price is $50 per visit, the frequency of repurchase is 12 times per year, the contribution margin is 10 percent, and the average customer defection rate is 25 percent? If a continuous improvement goal is set of a 20 percent defection rate next year and 15 percent two years from now, what are the revised VLCs over their average buying life?
