01 April 2006


IPAK is an acronym for Inactive, Potential, Active and Key.

IPAK is used to segment different types of customers in order to achieve optimal resources of allocation. It is similar to the concept of "Customer Pyramid", but IPAK is more systematic.

IPAK is further divided into 2 sub-segment 0 and 1, with 1 possesses higher value than 0.


I0 - Lost Customer: One who was once a customer but has not bought in at least one normal purchase cycle. I0 represents more than the loss of the next sale; the enterprise loses the future profit on that customer's life-time purchases, referrals and word-of-mouth advertising.

I1 - At-Risk User: One who is considered to be at-risk due to decreased activity and high probability of defection, and is more likely to switch to competitor and discontinue the relationship.


P0 - Suspect: One who is a target for business, regardless of whether the target has a current need or is ready to act. The goal of the enterprise is to engage P0 for further qualification.

P1 - Prospect: One who has a need, pays attention to the enterprise, and has a propensity to purchase within a specific time frame. The more immediate the need, the shorter the time frame.


A0 - First-Time Purchaser: One who purchases for the first-time, and is of varying profitability. Repeat purchase is strongly related to the initial and subsequent experience at each touchpoint.

A1 - Occasional Buyer: One who purchases on an occasional basis, and can be a customer of the enterprise and a customer of competitor.


K0 - Regular Customer: One who buys regularly due to consistent touchpoint experience and high level of satisfaction, which leads to increased cross-selling and up-selling success.

K1 - Advocate: One who is loyal and immune to the pull of competition, sells on the enterprise's behalf and brings customers. The strategy is to grow customer share and enhance customer lifetime value.

In Customer Loyalty, Jill Griffin identifies 6 stages of off-line customers.
(1) Suspect
(2) Prospect
(3) First time customer
(4) Repeat customer
(5) Client
(6) Advocate

For on-line customers, there are 7 stages as follows.
(1) Surfer
(2) First time site visitor
(3) Repeat visitor
(4) First time buyer
(5) Repeat buyer
(6) Client
(7) Advocate

It is not necessary to differentiate between on-line and off-line, but rather B2B (customer) and B2C (consumer). B2B and B2C have different expectations on the purchase cycle. Regardless of expectations, both groups go through the same stage - IPAK.

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