Customer Value Analysis (SAP Library

Customer Value Analysis

Use

During customer value analysis, you determine the value that individual customers or customer segments represent for your company. You can then deploy these values in your decision-making regarding investments.

The following analyses form part of customer value analysis:

Customer Profitability Analysis
Customer Lifetime Value Analysis
ABC Analysis

Integration

Most of the functions for customer value analysis are implemented in the SAP Business Information Warehouse (SAP BW). This means that you can use any system that extracts data into SAP BW as a source for the analyses. In this way, you can therefore perform ABC analysis on the basis of the data that originates from SAP R/3, SAP CRM, or external systems, for example.

It is particularly important for customer profitability analysis that SAP R/3 Financials is integrated. The SAP R/3 component Profitability Analysis (CO-PA), which manages cost and revenue data, lends itself optimally for performing more detailed customer contribution margin analysis.

Features

Customer Profitability Analysis

One of the most frequently used and most important key figures for customer valuation is customer profitability. Customer profitability is most easily calculated as the difference between revenue and costs. It is more useful, however, to perform detailed customer contribution margin analysis including different revenue types, product costs, and sales costs, to produce a coherent picture.

You can perform customer profitability analysis via the integration of SAP BW with SAP CRM and the SAP R/3 component Profitability Analysis (CO-PA). The costs and revenues data captured in CO-PA can be transferred into SAP BW for analysis. Similarly, you can also copy data from SAP BW into CO-PA. In this way, you can use activities entered in SAP CRM to allocate sales and marketing costs to the individual customers that caused them in CO-PA. SAP CRM and CO-PA are thereby also integrated.

Functions for the integration of SAP BW and CO-PA form the technical basis for customer profitability analysis:

You can use an extractor to transfer the data for a CO-PA operating concern into an SAP BW InfoCube.
Moreover, you can use a retractor to copy into CO-PA data from a query in SAP BW. This means, for example, that data previously extracted from SAP CRM into SAP BW can also be considered in CO-PA.

For more information on the integration of SAP BW and CO-PA, enter transaction SBIW in your R/3 System (with imported plug-in) and choose Settings for Application-Specific DataSources ® Profitability Analysis. See also SAP note 0205201.

Customer Lifetime Value Analysis

Customer lifetime value analysis (CLTV analysis) examines the customer value for the customers of a particular segment across the entire customer relationship (customer lifetime value). Consequently, CLTV analysis is particularly well-suited to supporting your decisions on how much to invest in the acquisition of new customers.

CLTV analysis is implemented as an analytical application in SAP BW. It is available from Release 2.1C Support Package 8. For more information on the range of functions, see the documentation in the SAP Library for SAP BW under Business Content ® Analytical Applications ® Customer Relationship Management ® Customer Lifetime Value Analysis: Overview.

ABC Classification

You use ABC classification to classify customers as A, B, or C customers on the basis of their profitability data. In this way, you can determine, for example, how much revenue you company earns with what percentage of your customers. This information can then serve as the basis for how you allocate your marketing, sales, and customer service resources, for example.

For more information about the range of functions, see the SAP Library for SAP BW (from BW 3.0B) under Business Content ® Analytical Applications ® Customer Relationship Management ® Data Mining ® ABC Classification.