The Impact of Goal Enabling Technology on Customer Lifetime Value

1 Pages Posted: 18 Jun 2021

See all articles by Jake An

Jake An

Raiz Invest Limited

Andre Bonfrer

Deakin University; Australian National University (ANU)

Christine Eckert

University of Technology Sydney (UTS) - School of Marketing

Date Written: May 31, 2021

Abstract

Service providers increasingly offer goal enabling technologies (GETs) in the pursuit of becoming more customer-centric. The popularity of GETs is based on the assumption that enabling customers to set service specific goals can improve both the service's value to the customer and the customer's value to the service. Firms need to know whether this assumption holds and whether there are boundary conditions that govern where the assumption does not hold. We use panel data from an investment services provider that introduced a GET to examine how customers who specified goals with GET changed their behavior and thereby customer lifetime value. We leverage a synthetic control structural matching method to enable estimation of changes in customer behavior for goal setters relative to a comparable control group. The results indicate that the introduction of GET increases customers' goal-congruent behavior which in turn improves customer lifetime value. The results also indicate that the impact of GETs depends on several goal characteristics, namely customers' perceived goal attainment difficulty, motivation, and commitment at the time of goal setting. An inverted U-shape for each of these goal characteristics is identified, a feature that can guide practitioners to personalize goals to optimize performance for customers and firms.

Keywords: Goal enabling technology, Customer Lifetime Value, Synthetic Controls

JEL Classification: M3

Suggested Citation

An, Jake and Bonfrer, Andre and Eckert, Christine, The Impact of Goal Enabling Technology on Customer Lifetime Value (May 31, 2021). Available at SSRN: https://ssrn.com/abstract=3863123 or http://dx.doi.org/10.2139/ssrn.3863123

Jake An (Contact Author)

Raiz Invest Limited ( email )

11/2-4 Bulletin Pl
Sydney, 2000
Australia

Andre Bonfrer

Deakin University ( email )

Australia

Australian National University (ANU) ( email )

Canberra, Australian Capital Territory 2601
Australia

Christine Eckert

University of Technology Sydney (UTS) - School of Marketing ( email )

P.O. Box 123
Broadway, NSW 2007
Australia

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