Paper ID: 2501.04719

Calculating Customer Lifetime Value and Churn using Beta Geometric Negative Binomial and Gamma-Gamma Distribution in a NFT based setting

Sagarnil Das

Customer Lifetime Value (CLV) is an important metric that measures the total value a customer will bring to a business over their lifetime. The Beta Geometric Negative Binomial Distribution (BGNBD) and Gamma Gamma Distribution are two models that can be used to calculate CLV, taking into account both the frequency and value of customer transactions. This article explains the BGNBD and Gamma Gamma Distribution models, and how they can be used to calculate CLV for NFT (Non-Fungible Token) transaction data in a blockchain setting. By estimating the parameters of these models using historical transaction data, businesses can gain insights into the lifetime value of their customers and make data-driven decisions about marketing and customer retention strategies.

Submitted: Jan 2, 2025