Fix CLV metric reliability for customer segmentation

[ijac13]

Summary

Problem: "High-value" customers not converting - CLV metric unreliable for Marketing targeting.

Root causes fixed:

• Returns inflating CLV (customers with high purchase volume but high returns counted as high-value)
• No recency tracking (dormant customers treated same as active)
• Static thresholds not adapting to customer base changes

Changes

• Net CLV: Added clv_net_returns excluding return amounts from lifetime value calculation
• Recency segments: Added days_since_last_order and recency_segment (Active/Recent/Lapsing/Dormant)
• Marketing segments: Combined value + recency into actionable segments (VIP Active, VIP At-Risk, VIP Lost, etc.)
• Dynamic thresholds: Replaced static $100/$50 cutoffs with percentile-based segmentation (top 25%, 25-50%, bottom 50%)

Impact

• 57 customers reclassified based on net CLV
• $312K in returns excluded from CLV calculations
• New segments enable targeted campaigns for retention vs. acquisition

Reviewer Checklist (for Marketing)

• Verify the new segment definitions match business understanding:
  • High Value = top 25% by net CLV
  • Medium Value = 25-50% by net CLV
  • Active = ordered within 30 days, Recent = 90 days, Lapsing = 180 days, Dormant = 180+ days
• Confirm excluding returns from CLV aligns with how Marketing values customers
• Review the marketing segments (VIP Active, VIP At-Risk, etc.) for targeting use cases
• Run dbt build and query customer_segments to validate segment distribution

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[b-per]

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