Customer Decision Management

anygren — Mon, 05 May 2008 21:37:49 +0000

Here’s a whitepaper I wrote a year ago. customer_decision_management1

The primary point is that in order to maximize the efficiency of customer acquisition and retention programs, one must understand and manage the customer decision-making process.

Customer Decision Functions

anygren — Mon, 05 May 2008 21:09:04 +0000

Notes on Customer Decision Functions

Customer Decision Functions are function equations that parse out the factors involved in a customer decision. By identifying the factors, and then arranging them into the form of a formula, one is able to understand better the levers for influencing the decision and the trade-offs necessary to secure a successful outcome.For example, in the case of a customer referral program that involves a reward, the function would be:

f[Referral] = (Satisfaction – Risk(reputation)) * Reward – (Effort / Attainability)

This means, for example, that if satisfaction is extremely high and the potential risk to reputation low, the reward could be relatively small, provided that there was minimal effort involved in obtaining it and it was readily attainable. If satisfaction were not as high, the reward would need to be greater. If it were difficult to obtain a reward, it would either need to be substantial or satisfaction would need to be significant. An example of this last scenario would be one in which the referer gets some personal satisfaction/cache from telling others about the product/service.

Other functions are below.

f[Loyalty Program Participation] = Reward^Attainability – Effort^1/Investment

f[Loyalty] = Satisfaction + Benefit(status quo) – Competitor Value^Ease of switching

f[Satisfaction] = Reality – Expectations

f[Purchase vs. Status Quo] = Benefit * Benefit Attainability – Cost + Risk(status quo) – Risk(change)

f[Referral] = (Satisfaction – Risk(reputation)) * Reward – (Effort / Reward Attainability)

f[Renewal Membership/Maintenance Program] = Satisfaction + Need(anticipated) + Risk(non-renewal) – Cost

Intro to Customer Experience Optimization

anygren — Mon, 05 May 2008 20:53:28 +0000

The goal of this blog is to initiate conversations about how to understand, manage, and improve the customer experience across businesses with the end result of increasing customer value.