Given the pervasive ubiquity of data, sales practice is moving rapidly into an era of predictive analytics, using quantitative methods, including machine learning algorithms, to reveal unknown information, such as customers’ personality, value, or churn probabilities. However, many sales organizations face difficulties when implementing predictive analytics applications. This article elucidates these difficulties by developing the PSAA model—a conceptual framework that explains how predictive sales analytics (PSA) applications support sales employees’ job performance. In particular, the PSAA model conceptualizes the key contingencies governing how the availability of PSA applications translates into adoption of these applications and, ultimately, job performance. These contingencies determine the extent to which sales employees adopt these applications to revise their decision-making and the extent to which these updates improve the decision outcome. To build the PSAA model, we integrate literature on predictive analytics and machine learning, technology adoption, and marketing capabilities. In doing so, this research provides a theoretical frame for future studies on salesperson adoption and effective utilization of PSA.
Sales managers are unlikely to reap the benefits of implementing predictive analytics applications when salespeople show aversion to or lack understanding of these applications. For managers, it is essential to understand which factors mitigate or exacerbate these challenges. This article investigates these factors by studying the implementation of an application that predicts customer churn. Using 9.7 million transactions from a B2B company, the authors develop a predictive model of customer churn, implement it in a field experiment, and study its treatment effects using causal forests. Furthermore, the authors manipulate one specific mitigation strategy proposed by prior literature: the fostering of users’ realistic expectations regarding the accuracy of an algorithm. The results show that the effectiveness of the churn prediction application strongly depends on customer characteristics (most importantly the predicted churn probability and prior revenue) and salesperson characteristics (technology perceptions, abilities, and selling orientations). Fostering realistic expectations only improves the effectiveness of the churn prediction under very specific circumstances. Two follow-up stimuli-based experiments conceptually replicate key results of the field study. Therefore, this paper helps build theory on predictive sales analytics and provides specific guidance to managers aiming to increase their return on analytics investments.
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