Training Your Customers How To Behave

Ok, here's a query for you. We take all customers and segment them based on life-to-date purchases. Then I select customers who place "average" average order values. Finally, I segment customers based on percentage of historical demand spent on items at/above the historical average price point of the item. Within the cells of the resultant query table, I measured the percentage of future (next 12 months) sales from items selling at/above their historical average.

Tell me what you observe.

The table illustrates key findings:

• Once you train a customer to bargain hunt, the customer bargain hunts.
• When you train a customer to pay full price, the customer is more likely to pay full price in the future.

Look at the customer who has bought 6+ times and has 26% to 50% of historical demand/sales coming from items selling at/above their historical average:

• 70.4% of future sales are from items at/above their historical average.

Look at the customer who has bought 6+ times and has 76% to 99% of historical demand/sales coming from items selling at/above their historical average:

• 82.4% of future sales are from items at/above their historical average.

Now, you may not think that a 12% difference in the metric matters.

It matters.

More tomorrow.

P.S.:  You create this table and have it as part of your dashboard, right?