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From Customer Experience Matters: In his recent letter to shareholders, Amazon.com CEO Jeff Bezos provides insight into a truly customer-centric organization. The letter demonstrates how Amazon operates with a long-term view of customer value.
From Knowledge@Wharton: Amazon.com will lose money on each $199 Kindle Fire it sells, but hopes to make back that money and more on tablet users who are expected to spend more than other customers. Sprint is not expected to turn a profit selling Apple’s iPhone for at least three years, but expects that gamble to pay off in happier users who will bring in more subscribers.
The principle underlying these moves is customer lifetime value (CLV), a marketing formula based on the idea of spending money up front, and sacrificing initial profits, to gain customers whose loyalty and increased business will reap rewards over the long term. It is a model that is becoming more and more popular among technology companies, including Amazon, Sprint, Netflix and Verizon. And as software companies increasingly turn to subscription-based business models through cloud computing, CLV will become an even larger issue, according to Wharton experts.
From FastCompany: To state this as clearly as possible: The four American companies that have come to define 21st-century information technology and entertainment are on the verge of war. Over the next two years, Amazon, Apple, Facebook, and Google will increasingly collide in the markets for mobile phones and tablets, mobile apps, social networking, and more. This competition will be intense. Each of the four has shown competitive excellence, strategic genius, and superb execution that have left the rest of the world in the dust.