ACURA Strategy Development<\/p>\n
ACURA is an acronym that represents variant customer-related strategies including acquisition, cross selling, up selling, retention, and advocacy (Biswas, 2014). It is an important strategy in ensuring that both consumers and firms are able to find value through approaches within each of the five strategies in ACURA. It allows firms to design a variation of related approaches including promotional deals, offers on products, bundling, attractive alternatives, and many other strategies to not only acquire but also retain consumers and win them back in case of loss.<\/p>\n
Cross-selling and Up-selling Strategy<\/p>\n
For the low budget young customer segment, Raiz Invest Limited should cross selling will be among the most effective means to increase revenue. For instance, Raiz could provide bundled products in an attractive package for example enabling mobile payments on its digital lending and credit platform. It could also provide insurance on mobile loans as a way to increase revenue for a market segment that is focused on the product and its benefits while remaining consciously sensitive of price. In light of this, the most applicable cross-selling strategy that Raiz can use on the low budget young consumers is promoting products that other people bought, including any available offers and related items for the same. <\/p>\n
Ghoshal, Mookerjee, and Sarkar (2021) advocate for recommending related items in a cross-selling strategy as one of the most effective ways to get price sensitive consumers to purchase. Similarly, offering discounts on bundled products is noted by Jayalath and Premaratne (2021) to rapidly increase sales for young consumers. Other strategies that apply to Raiz\u2019s cross-selling strategy would include promoting products that are essential to another product\u2019s performance. For example, if a customer takes a mobile loan, Raiz could offer an insurance package against delayed payments as a way of adding value to the original product. In this way, revenue is generated and the customer sees value in both products. Therefore, a cross-selling strategy is recommended for the low budget young segment of Raiz\u2019s market. Bundling, recommending products, recommending related products, offering discounts on products and bundles, and promoting products essential to another product\u2019s performance are the most effective approaches. <\/p>\n
Retention Strategy<\/p>\n
Retention is defined by Mahmoud, Hinson, and Adika (2018) as the ability to get an acquired customer to buy a product again. For example, when a customer renews their insurance package every year with the same agency for five years. To increase customer loyalty among existing low budget young customers, Raiz will need to employ excellent customer service on its platforms, offer bundled discounts and surprise gifts, and have a personal relationship strategy. Other strategies proposed by Gomber et al. (2018) include fast support, personalized interactions, meeting customers where they are, incentivizing loyalty. And gathering feedback on a regular basis. The idea is to boost loyalty through creating buyer relationships. <\/p>\n
Raiz will also need a win-back strategies for lost customers. It will encompass a \u201cwe fixed the issue\u201d campaign that addresses the reason why customers stopped buying a product or switched to a rival organization. There will also be incentives provided to win back customers. For example, discounted prices on previous bundled purchased over a period of time. Lastly, social media personalized campaigns will target interactions with consumers (Renjith, 2017). Recovery strategies in the case of product or service failure for the low budget young consumers will include free products for a trial basis, discounts, apologies, and coupon. For the unprofitable customers, no action will be taken, but instead products will be bundled up to ensure that they are either able to move up their spending curve or exit altogether. <\/p>\n
Objectives<\/p>\n
The objectives are focused on attaining the following objectives as well as key performance indicators (KPIs)<\/p>\n
Enable Raiz to increase its market share by 25% in the target segment including the low budget young group<\/p>\n
Reduce the churn rate by 4% for the first quarter of operations<\/p>\n
Raise the customer loyalty rate by 10% by converting current passives to promoters<\/p>\n
Time-Scheduled Roadmap <\/p>\n
For cross-selling and retention strategies for the low budget young segment, the following time schedule is recommended for Raiz to apply.<\/p>\n
Phase Activity Timeframe<\/p>\n
Phase 1 Bundling products in an attractive package In the next 12 months<\/p>\n
Review and update of bundled products every 2 months<\/p>\n
Phase 2 Promoting products that other people bought<\/p>\n
Recommending related items Continuously for the next 12 months<\/p>\n
Phase 3 Offering discounts on bundled products For the next 12 months<\/p>\n
Weekly reviews<\/p>\n
Phase 4 Promoting products that are essential to another product\u2019s performance For the next 12 months. Review every month based on uniquely bundled products and highest moving products<\/p>\n
Phase 5 Excellent customer service<\/p>\n
Fast support<\/p>\n
Personalized interactions<\/p>\n
Meeting customers where they are<\/p>\n
Incentivizing loyalty Continuous for the next 12 months<\/p>\n
Phase 6 Surprise gifts Every week<\/p>\n
Key Performance Indicators <\/p>\n
The metrics for the low budget young segment is as follows<\/p>\n
Cross-Selling Metrics<\/p>\n
KPI Composition Sources Frequency<\/p>\n
Sales effort spent Amount of time spent on the right products by sales representatives Time logged on phone calls and customer engagement Weekly<\/p>\n
Activities per opportunity New pipeline generated efficiency Amount of time used to make interactions leading to new business Weekly<\/p>\n
Win rate New business generated out of each cross-sell strategy Conversion rates leading to business Monthly<\/p>\n
Attach rate Accurate forecasting of cross-sell and net new more accurately Higher numbers per period Quarterly<\/p>\n
Renewal rate Selling products with a long term value Amount of repeat business per period Annually<\/p>\n
Retention Metrics<\/p>\n
KPI Composition Sources Frequency<\/p>\n
Customer retention rate Calculated through getting number of customers at end of time period minus the number of new customers acquired during time period (divided by number of customers at the beginning of a time period) New customer entries Monthly<\/p>\n
Churn rate The percentage of lost customers over a given time period Customer accounts Monthly<\/p>\n
Existing customer revenue growth ratio Revenue generated from customer success, retentions, and loyalty effort Higher numbers of monthly revenue from retention efforts Monthly<\/p>\n
Net incremental revenue Changes in net revenue earned Higher numbers per period Quarterly<\/p>\n
Repeat purchase rate Percentage of customers returning to make repeat purchases Amount of repeat business per period Monthly<\/p>\n
References<\/p>\n
Biswas, S. (2014).\u00a0Relationship marketing: concepts, theories and cases. PHI Learning Pvt. Ltd..Ghoshal, A., Mookerjee, V. S., & Sarkar, S. (2021). Recommendations and Cross-selling: Pricing Strategies when Personalizing Firms Cross-sell.\u00a0Journal of Management Information Systems,\u00a038(2), 430-456.<\/p>\n
Gomber, P., Kauffman, R. J., Parker, C., & Weber, B. W. (2018). On the fintech revolution: Interpreting the forces of innovation, disruption, and transformation in financial services.\u00a0Journal of management information systems,\u00a035(1), 220-265.<\/p>\n
Jayalath, J. A. R. C., & Premaratne, S. C. (2021). Analysis of Key Digital Technology Infrastructure and Cyber Security Consideration Factors for Fintech Companies.\u00a0Analysis of Key Digital Technology Infrastructure and Cyber Security Consideration Factors for Fintech Companies,\u00a084(1), 8-8.<\/p>\n
Mahmoud, M. A., Hinson, R. E., & Adika, M. K. (2018). The effect of trust, commitment, and conflict handling on customer retention: the mediating role of customer satisfaction.\u00a0Journal of Relationship Marketing,\u00a017(4), 257-276.<\/p>\n
Renjith, S. (2017). B2C E-Commerce customer churn management: Churn detection using support vector machine and personalized retention using hybrid recommendations.\u00a0International Journal on Future Revolution in Computer Science & Communication Engineering,\u00a03(11), 34-39.<\/p>\n","protected":false},"excerpt":{"rendered":"
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