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Company executives were amazed at this outcome. They did know a great deal of money was spent
on this process since this was a radically new business service requiring a great deal of customer
contact, but the magnitude of the final acquisition cost numbers for the two customer groupings in
Exhibit 13.1—$127,500 and $158,500—caused them to rethink their customer capture process. There
was no doubt that it could be done in a more efficient manner.
The costs for the second process, loading 8 of the 10 customers signed to contracts onto the
network, as shown in Exhibit 13.2, only added to this new focus on efficiency. The first two activities,
an outsourced business process review that cost $4,000 apiece for a total of $32,000 (8 customers
loaded × $4,000) and the approximately $5,000 internal system design cost that was relatively routine,
were expected. The implementation and certification activity was once again a surprise. The 3
knowledgeable customers loaded in the first year had internal IT professionals that made this step
simple and relatively inexpensive—$6,000 each—but for the 5 not so aware, Company Z had to do all
the work once again, making this customer segment much more costly at $24,600. To spend at a
minimum about $140,000 on getting a single customer (a knowledgeable customer cost $127,500 to
get to signed contract and another $15,000 to load onto the network) to the revenue-producing stage of
their business was a challenge. Research showed, however, that customers were willing to pay about
10 cents per individual transaction processed (e.g., a request for a credit check or the receiving of the
credit check), which resulted in about $1.20 per item sold, so maybe this front-end investment could
be recouped over time (see Exhibit 13.3 for back-room transaction details for every item sold).
Exhibit 13.2 Customer loading cost summary.