Lifetime Value Analysis

Projecting lifetime value of a client is important for acquisition, retention sales and value management teams. The LTV model used in StoneX Retail is designed to provide a prediction of LTV at 6 months, 1 year and 2 years after 30 days of customer activity.  

Key benefits of the LTV model are: 

–Improve acquisition performance and measurement 

–Help finesse CVM/RM/Sales strategies based on predicted value of client 

–Increase accuracy of the revenue model 

The LTV model is calculated at a client level, irrespective of the number of products they have with us. The 6 month model uses up to 90k client trading, acquisition and interaction data from 2018-2020. Like other models, 68 variables were tested and 15 most important variables are used for the model. We tested Random forest and Gradient boosted decision tree models.   

Marketing can use this information to target similar clients to continually increase our ROI. 

The LTV values are calculated daily in our data warehouse and available to various teams across the Retail business.