Customer Retention

As the pandemic of 2020 unwinds, and consumers are willing to go the retail stores to shop, Ulta Beauty can be ready to reach out to already loyal customers of the brand. The idea of customer retention begins with using a decision under risk chart analysis to determine how to target the Ulta Beauty loyalist. The welcome back coupon with any purchase can either be delivered through a mailing postcard or an email blast campaign. The chart is an analysis for the decision-maker to decide the best course of action in their opinion that makes the most monetary sense.

Decision Under Risk Chart

By analyzing the probability by the utility, the decision-maker can choose by seeing the percentage of the utility function. The estimated projected totals can help support the action by the amount of payoff for up cost expenses to the utility percent that will support the measure.

Utility Function

The calculations determine a 63% chance that the customer will see and utilize the mailing postcard versus an 80% to receive the email and use the coupon code to purchase online.

The decision-maker can determine from the calculations that an email blast can outweigh the payoff spending even though mailing postcards appear less costly to achieve.

The end goal is for customer retention and reviews that are positive. The customer effort plan is to minimize customer churn.

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