You have javascript disabled in your browser. We recommend turning it on for a better experience on this site.


Business School wins KTP Award

Business School wins KTP Award

A Knowledge Transfer Partnership (KTP) between Leeds University Business School and Clydesdale Bank has been awarded the ESRC award for 'Best Application of Social Science in a KTP 2011.'

The Customer Lifetime Value (CLV) modelling project was undertaken as a KTP by Alena Audzeyeva working with Professor Klaus Schenk-Hoppé (Accounting & Finance Division), Dr Barbara Summers (Centre for Decision Research) from Leeds University Business School and Lucy Marshall from Clydesdale Bank plc.

The Economic and Social Research Council (ESRC) are the UK's largest funder of research on economic and social issues.

CLV modelling involves examining the value of the cash flows attributed to relationships with customers.  CLV is not a new concept, however it poses a formidable challenge in the environment found in financial services organisations. The multidimensional nature of customer behaviour; the wide variations in which products a customer uses; and the fact that customers can switch between products and product providers at any time - all add to the challenge. Existing approaches had not found a successful solution to these problems.

A major shift to a customer focused approach

The project allowed novel mathematical approaches to be applied to a real-world problem using live business data. A new, adaptive segmentation modelling approach was developed. This is based on the idea that customers with similar characteristics and behaviours tend to exhibit similar behaviour in the future.

"Choosing to do the project as a KTP allowed us to search for an innovative solution and gave us the luxury of accessing the academic skills we didn't possess. Not only did it resolve a business need, it strengthened the relationship with the University and was personally rewarding for all those involved in the project." Lucy Marshall, Clydesdale Bank plc.

The application of Customer Lifetime Value models marks a major shift to a customer focused rather than product-focused approach to the customer relationship. Groups of customers with similar characteristics and needs can be distinguished, and provided with information and product offerings that are focused on their needs. This deeper understanding of customers allows the Bank to respond in a more tailored way to customers, building direct mail and call centre campaigns around the most appropriate communications for each customer, rather than giving everyone the same message.

For further information please contact Dr Barbara Summers

For further information:

Please contact the University of Leeds Press Office on +44 (0)113 343 4031 or email pressoffice@leeds.ac.uk

Back to the top