Proactive Customer Education, Customer Retention, and Demand for Technology Support: Evidence from a Field Experiment

Abstract

D o service provider efforts to educate customers influence customer outcomes? We analyze the outcome of a field experiment executed by a major public cloud infrastructure services provider in 2011. Out of 2,673 customers who adopted the service during the experiment, 366 received a service intervention: an engagement through which the provider offered initial guidance on how to use basic features of the service. Before execution, it was unclear if this proactive customer education would have positive or negative effects on customer retention and demand for technology support. We show the treatment reduces by half the number of customers who churn from the service during the first week. Further, treated customers ask 19.55% fewer questions during the first week of their tenure than the controls. Although the treatment's effects decay within one week, we show that such proactive customer education can have significant economic benefits for the provider. In particular, we find that treated customers increase their accumulated usage of the service by 46.57% in the eight months after sign-up. Finally, we provide evidence that the effects of the treatment are strongest among customers who have less experience with the provider.

Co‐creating value using customer training and education in a healthcare service design

“…This paper first conducted an in‐depth literature review of professional services and value co‐creation. This prior research indicates that CTE is correlated with increased readiness (e.g., Bowen, 1986), which is correlated with performance and outcomes (e.g., Dellande et al., 2004; Field et al., 2012; Retana et al., 2016). Second, to better understand the chain of relationships in the model, one researcher conducted extensive interviews with patients with diabetes and observed multiple diabetes education programs.…”

“…Recently customer learning research made significant improvement in understanding how to reduce the risk of customer participation through using various learning channels. The importance of customer learning, facilitated by CTE, has increasingly been recognized in multiple services (e.g., Field et al., 2012; Hibbert et al., 2012; Retana et al., 2016) and by professional services researchers (Bettencourt et al., 2002; Harvey (2011). Field et al.…”

“…Hibbert et al. (2012) found that customer learning was an important success factor in marketing and Retana et al. (2016) found that CTE provided through a scripted phone call positively affected customer retention.…”

“…This is accomplished through an extensive literature review, and qualitative and quantitative investigations. Specifically, we first reviewed professional services research (e.g., Harvey, 1990, 2011; Heineke, 1995; Lewis and Brown, 2012), service deign research (e.g., Heineke, 1995; Voss et al., 2008; Harvey, 2011); value co‐creation research (e.g., Bowen, 1986; Vargo and Lusch, 2004; Prahalad and Ramaswamy, 2004; Sampson and Froehle, 2006), and related literature on customer learning (e.g., Xue and Harker, 2002; Field et al., 2012; Hibbert et al., 2012; Retana et al., 2016) to create a conceptual model (presented later as Fig. 2).…”

Introduction to the Special Issue on Practice-Focused Research

“…The second paper within this set, "Proactive Customer Education, Customer Retention, and Demand for Technology Support: Evidence from a Field Experiment" by Retana et al (2016), evaluates a new customer support program initiated by a "major public cloud service provider." In this article the focus is on customer retention-a fundamental driver of success across almost all industries.…”