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Earlier this month American Express executed their Tweet to Buy promotion for discounted gift cards. This HBR article lays out the thinking behind American Express’ willingness to sell a $25 gift card for $15 to their cardholders that will Tweet their brand. It also shows how this particular execution is likely to produce a low return on investment without a more specific focus on certain market segments – hence the shift from Customer Lifetime Value (CLV) to Customer Network Value (CNV).
This is an excellent illustration of a thought process that retailers need to go through to ensure they get a high return on a discounted offer. There’s really no excuse today for not going through this exercise with any programs in the world of digital marketing.