Introduction
myAItesting was brought on to understand the customer lifetime value (LTV) of various customer segments. Understanding LTV is crucial for any business, but it is particularly important for venture capital investors who are considering investing in the company. This analysis was used to inform the company's fundraising efforts and my personal involvement included presenting the findings to the c-suite officers and board members.
Methodology
To understand the LTV of the different customer segments, we first segmented the customers based on demographic information such as age and gender, product information such as subscription tier and cost of initial fixed product purchase, and user behavior data including usage in the first week and first month.
Next, we used a financial analysis technique called cohort analysis to understand how much revenue each segment generated over a period of time. This allowed us to calculate the LTV for each segment. We also used statistical models like Survival Analysis, Regression Analysis, etc to understand which factors were most important in determining LTV, and how they interacted with each other.
Results & Conclusion
The results of the analysis showed that certain segments had a higher LTV than others. For example, segments with a higher subscription tier and those who made a larger initial fixed product purchase had a higher LTV than other segments. We also found that early engagement, as measured by the amount of activity in the first week and first month, was positively correlated with LTV.
