Out of the trap: Conversion funnel business model, customer switching costs, and industry profitability

• Main Authors: ABOLFATHI, Niloofar, FOSFURI, Andrea, SANTAMARIA, Simone
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2022
• Subjects: Customer Switching Costs; Industry Profitability; Conversion Funnel; Business Model; Market Frictions; Sales and Merchandising; Strategic Management Policy
• Online Access: https://ink.library.smu.edu.sg/lkcsb_research/7278; https://ink.library.smu.edu.sg/context/lkcsb_research/article/8277/viewcontent/OutofTrap_sv.pdf
• Institution: Singapore Management University

Research Summary: Across many industries, firms employ a conversion funnel business model to attract customers with basic and affordable products, generate lock-in, and then sell them more advanced and expensive products. We argue that this business model, coupled with high customer switching costs,...