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What Is Customer Dynamics?

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  • Written By: Malcolm Tatum
  • Edited By: Bronwyn Harris
  • Last Modified Date: 03 November 2016
  • Copyright Protected:
    2003-2016
    Conjecture Corporation
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Customer dynamics is a term that is used to describe the flow of activity that takes place between a customer and a vendor or supplier. The range of this type of activity will include the free exchange of information as well as any type of transactions that occur between the two parties. As part of the process, customer dynamics goes beyond simply looking at the purchasing activity generated by the customer and includes consideration of the range of emotions and the establishment of relationships that occurs as part of that ongoing exchange of information. This approach can aid in qualifying the level of rapport and loyalty that each party exhibits toward the other, which in turn can help to define the value of the relationship to each of the parties involved.

As part of assessing customer dynamics, a number of types of interaction are taken into consideration. This begins with the level of rapport and trust that is established during the initial sales contacts, moves on through the creation of customer accounts, the processing of customer orders and the nature of the interactions between clients and customer support personnel. Within the scope of these types of interactions, every type of communication is considered important to the dynamics of the relationship. Telephone calls, emails, face to face meetings and the ease of placing and receiving orders are all factors that help to provide a more accurate assessment of the relationship that exists between customer and provider.

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There are a number of benefits to understanding customer dynamics. One very important result of this activity is that providers can identify ways to strengthen ties with customers. This is valuable in that customers who feel more invested with a given provider are less likely to be led astray by competitors, based on their loyalty to the provider. Even if competitors offer some very attractive pricing or other incentives, the chances of the customer at least offering the provider a chance to counter the offer are greatly improved. In some cases, the dynamics between the client and provider may be so strong that consideration of working with a competitor is neither practical nor desirable.

Providers can also make use of strong customer dynamics as a means of obtaining feedback that makes it possible to improve current products or even develop new ones in an effort to meet additional needs expressed by customers. From this perspective, evaluating all the exchanges of information between the two parties can pave the way for new ideas that ultimately benefit everyone involved. Along with enhancing the range of the product line, this type of healthy exchange can sometimes lead to changes in policies and procedures that provide additional benefits to customers and aid in strengthening the ties already in place.

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