Design to learn: customizing services when the future matters

Detalhes bibliográficos
Autor(a) principal: Ariely,Dan
Data de Publicação: 2013
Outros Autores: Bitran,Gabriel, Oliveira,Paulo Rocha e
Tipo de documento: Artigo
Idioma: eng
Título da fonte: Pesquisa operacional (Online)
Texto Completo: http://old.scielo.br/scielo.php?script=sci_arttext&pid=S0101-74382013000100003
Resumo: Internet-based customization tools can be used to design service encounters that maximize customers' utility in the present or explore their tastes to provide more value in the future, where these two goals conflict with each other. Maximizing expected customer satisfaction in the present leads to slow rates of learning that may limit the ability to provide quality in the future. An emphasis on learning can lead to unsatisfied customers that will not only forego purchasing in the current period, but, more seriously, never return if they lose trust in the service provider's ability to meet their needs. This paper describes service design policies that balance the objectives of learning and selling by characterizing customer lifetime value as a function of knowledge. The analysis of the customization problem as a dynamic program yields three results. The first result is the characterization of customization policies that quantify the value of knowledge so as to adequately balance the expected revenue of present and future interactions. The second result is an analysis of the impact of operational decisions on loyalty, learning, and profitability over time. Finally, the quantification of the value of knowing the customer provides a connection between customer acquisition and retention policies, thus enhancing the current understanding of the mechanisms connecting service customization, value creation, and customer lifetime value.
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spelling Design to learn: customizing services when the future mattersService customizationcustomer learningcustomer lifetime valuedynamic programmingInternet-based customization tools can be used to design service encounters that maximize customers' utility in the present or explore their tastes to provide more value in the future, where these two goals conflict with each other. Maximizing expected customer satisfaction in the present leads to slow rates of learning that may limit the ability to provide quality in the future. An emphasis on learning can lead to unsatisfied customers that will not only forego purchasing in the current period, but, more seriously, never return if they lose trust in the service provider's ability to meet their needs. This paper describes service design policies that balance the objectives of learning and selling by characterizing customer lifetime value as a function of knowledge. The analysis of the customization problem as a dynamic program yields three results. The first result is the characterization of customization policies that quantify the value of knowledge so as to adequately balance the expected revenue of present and future interactions. The second result is an analysis of the impact of operational decisions on loyalty, learning, and profitability over time. Finally, the quantification of the value of knowing the customer provides a connection between customer acquisition and retention policies, thus enhancing the current understanding of the mechanisms connecting service customization, value creation, and customer lifetime value.Sociedade Brasileira de Pesquisa Operacional2013-04-01info:eu-repo/semantics/articleinfo:eu-repo/semantics/publishedVersiontext/htmlhttp://old.scielo.br/scielo.php?script=sci_arttext&pid=S0101-74382013000100003Pesquisa Operacional v.33 n.1 2013reponame:Pesquisa operacional (Online)instname:Sociedade Brasileira de Pesquisa Operacional (SOBRAPO)instacron:SOBRAPO10.1590/S0101-74382013000100003info:eu-repo/semantics/openAccessAriely,DanBitran,GabrielOliveira,Paulo Rocha eeng2013-05-24T00:00:00Zoai:scielo:S0101-74382013000100003Revistahttp://www.scielo.br/popehttps://old.scielo.br/oai/scielo-oai.php||sobrapo@sobrapo.org.br1678-51420101-7438opendoar:2013-05-24T00:00Pesquisa operacional (Online) - Sociedade Brasileira de Pesquisa Operacional (SOBRAPO)false
dc.title.none.fl_str_mv Design to learn: customizing services when the future matters
title Design to learn: customizing services when the future matters
spellingShingle Design to learn: customizing services when the future matters
Ariely,Dan
Service customization
customer learning
customer lifetime value
dynamic programming
title_short Design to learn: customizing services when the future matters
title_full Design to learn: customizing services when the future matters
title_fullStr Design to learn: customizing services when the future matters
title_full_unstemmed Design to learn: customizing services when the future matters
title_sort Design to learn: customizing services when the future matters
author Ariely,Dan
author_facet Ariely,Dan
Bitran,Gabriel
Oliveira,Paulo Rocha e
author_role author
author2 Bitran,Gabriel
Oliveira,Paulo Rocha e
author2_role author
author
dc.contributor.author.fl_str_mv Ariely,Dan
Bitran,Gabriel
Oliveira,Paulo Rocha e
dc.subject.por.fl_str_mv Service customization
customer learning
customer lifetime value
dynamic programming
topic Service customization
customer learning
customer lifetime value
dynamic programming
description Internet-based customization tools can be used to design service encounters that maximize customers' utility in the present or explore their tastes to provide more value in the future, where these two goals conflict with each other. Maximizing expected customer satisfaction in the present leads to slow rates of learning that may limit the ability to provide quality in the future. An emphasis on learning can lead to unsatisfied customers that will not only forego purchasing in the current period, but, more seriously, never return if they lose trust in the service provider's ability to meet their needs. This paper describes service design policies that balance the objectives of learning and selling by characterizing customer lifetime value as a function of knowledge. The analysis of the customization problem as a dynamic program yields three results. The first result is the characterization of customization policies that quantify the value of knowledge so as to adequately balance the expected revenue of present and future interactions. The second result is an analysis of the impact of operational decisions on loyalty, learning, and profitability over time. Finally, the quantification of the value of knowing the customer provides a connection between customer acquisition and retention policies, thus enhancing the current understanding of the mechanisms connecting service customization, value creation, and customer lifetime value.
publishDate 2013
dc.date.none.fl_str_mv 2013-04-01
dc.type.driver.fl_str_mv info:eu-repo/semantics/article
dc.type.status.fl_str_mv info:eu-repo/semantics/publishedVersion
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dc.identifier.uri.fl_str_mv http://old.scielo.br/scielo.php?script=sci_arttext&pid=S0101-74382013000100003
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dc.language.iso.fl_str_mv eng
language eng
dc.relation.none.fl_str_mv 10.1590/S0101-74382013000100003
dc.rights.driver.fl_str_mv info:eu-repo/semantics/openAccess
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dc.publisher.none.fl_str_mv Sociedade Brasileira de Pesquisa Operacional
publisher.none.fl_str_mv Sociedade Brasileira de Pesquisa Operacional
dc.source.none.fl_str_mv Pesquisa Operacional v.33 n.1 2013
reponame:Pesquisa operacional (Online)
instname:Sociedade Brasileira de Pesquisa Operacional (SOBRAPO)
instacron:SOBRAPO
instname_str Sociedade Brasileira de Pesquisa Operacional (SOBRAPO)
instacron_str SOBRAPO
institution SOBRAPO
reponame_str Pesquisa operacional (Online)
collection Pesquisa operacional (Online)
repository.name.fl_str_mv Pesquisa operacional (Online) - Sociedade Brasileira de Pesquisa Operacional (SOBRAPO)
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