ROI Case File No.221 | 'The Phantom of Southeast Asian Tourism'

Chapter 1: The Beginning of a New Mystery — Prelude to Volume XVII

The week following the conclusion of Volume XVI "The Quest for Agility," a new theme of cases began arriving at the ROI Detective Agency. This time, the theme was "The Challenge of Reproducibility." The true challenge for modern enterprises was not one-time success, but building mechanisms to continuously generate results.

As the memorable 221st case of this volume, a glamorous tourism industry executive from Southeast Asia appeared.

"Detective, our tourism business appears highly successful on the surface, but I'm not confident whether this success is 'sustainable.' I can't shake the feeling that there are invisible problems lurking behind the glamorous numbers."

Paradise Tours Asia CEO Prasart Chaiyawong visited 221B Baker Street with unmistakable confusion. In his hands were impressive growth data alongside contrasting customer retention reports.

"We are a company that operates tourism services across Southeast Asia. With the recovery in tourism demand post-COVID, we have rapidly expanded our business over the past two years."

Paradise Tours Asia's Spectacular Growth Record: - Annual customers: 150,000 → 850,000 (5.7x growth in 2 years) - Annual revenue: ¥12 billion → ¥48 billion (4x growth) - Countries/regions covered: 3 → 8 countries (entire Southeast Asia) - Employee count: 280 → 1,200 (rapid expansion) - Media recognition: Multiple awards as "rapidly growing tourism company"

The numbers certainly showed remarkable success. However, Prasart's expression was marked with deep concern.

"The problem is that this spectacular growth comes from 'one-time customers.' Our repeat rate is extremely low, and most customers never return after using our services once."

Serious Problems Hidden Behind Growth: - New customer acquisition: 70,000 monthly (strong performance) - Repeat rate: 12% (significantly below industry average of 45%) - Customer lifetime value: Less than 1/3 of industry average - Word-of-mouth/referral rate: 3% (significantly below industry average of 20%)

"We have succeeded in 'new customer acquisition' but completely failed in 'customer retention.' If this continues, our business will collapse the moment growth stops."

Chapter 2: Customers Who Don't Return — The Phantom Customer Base

"Mr. Prasart, have you conducted any research into the specific reasons why customers don't repeat?"

Holmes inquired gently.

Prasart answered with a confused expression.

"Actually, that's what confuses us most. Customer surveys show high satisfaction ratings of 4.2/5, yet somehow this doesn't translate to repeat business."

The Contradiction Between Customer Satisfaction and Behavior:

Typical Customer Feedback: - "The tour was enjoyable. The guide was kind, and the destinations were beautiful" (5/5 rating) - "Good cost performance, would recommend to friends" (4/5 rating) - "Would use again if the opportunity arises" (4/5 rating)

However, Actual Behavior: - Repeat usage by highly satisfied customers: Only 15% repeat rate - Friend referrals: Only 5% actual referral rate from customers who said they'd "recommend" - Re-booking: Only 8% actual re-booking rate from customers who said they'd "use again"

I focused on the gap between customer words and actions.

"Customers say they're 'satisfied' yet don't actually return. This indicates problems that satisfaction surveys can't capture."

Prasart sighed deeply.

"Exactly. We have achieved 'customer satisfaction' but failed at 'customer retention.' I can't understand the psychology of customers who are satisfied yet leave."

Most Serious Case: VIP Customer Departure - Customer: Wealthy Singapore family - Usage history: 3 premium tours (¥2.5 million total) - Satisfaction: 5/5 rating for all tours - Survey response: "Big fan of Paradise Tours. Perfect service" - Actual behavior: No usage for over a year, participated in competitor tours

"We can provide 'one-time amazement' but cannot build 'ongoing relationships.' It's like we have a phantom customer base."

Chapter 3: The AARRR Model Reveals Customer Trajectories — The Mystery of Vanishing Footprints

⬜️ ChatGPT | Catalyst of Concepts

"If you track the flow from acquisition to retention with numbers, phantoms become reality"

🟧 Claude | Alchemist of Narratives

"Tourism stories are completed with 'wanting to come again.' AARRR draws the emotional journey"

🟦 Gemini | Compass of Logic

"If you ignore retention, any growth becomes a castle of sand"

The three members began their analysis. Gemini deployed the "AARRR Model" framework on the whiteboard.

The 5 Stages of AARRR Model: - A (Acquisition): New customer acquisition - A (Activation): Value experience in first use - R (Retention): Promoting repeat usage - R (Referral): Creating word-of-mouth and referrals - R (Revenue): Revenue maximization

"Mr. Prasart, let's analyze Paradise Tours' customer journey in detail using AARRR."

Paradise Tours Asia AARRR Analysis:

Acquisition (Excellent): - Monthly new customers: 70,000 - Acquisition channels: 60% SNS ads, 25% search ads, 15% word-of-mouth - Acquisition cost: ¥1,200 per person (¥1,800 industry average) - Acquisition efficiency: Extremely high

Activation (Good): - First tour completion rate: 94% (high level) - First-time satisfaction: Average 4.2/5 - First experience trouble rate: 2% (low level) - Activation rate: Good

Retention (Critical Problem): - 3-month repeat rate: 12% (industry average 45%) - 6-month repeat rate: 18% (industry average 60%) - 1-year repeat rate: 22% (industry average 70%) - Critically low retention rate

Referral (Serious Problem): - Word-of-mouth posting rate: 8% (industry average 35%) - Friend referral rate: 3% (industry average 20%) - SNS share rate: 5% (industry average 25%) - Extremely limited referral effect

Revenue (Short-term): - Customer lifetime value: ¥38,000 (industry average ¥125,000) - Average usage frequency: 1.3 times (industry average 3.8 times) - Upsell success rate: 15% (industry average 45%) - Low long-term profitability

Claude presented shocking analysis results.

"This is serious. Paradise Tours excels in 'Acquisition' and 'Activation' but has critical problems in 'Retention,' 'Referral,' and 'Revenue.'"

Detailed AARRR Funnel Analysis:

Acquisition→Activation: 94% (Excellent) 94% of new customers complete their first tour and are satisfied

Activation→Retention: 12% (Critical) 88% of initially satisfied customers drop out

Retention→Referral: 25% (Low level) Even repeat customers have low referral rates

Biggest Problem Discovery: "Satisfied One-time Customer" Phenomenon Customers are satisfied but don't continue. Behind this phenomenon lies a structural problem specific to the tourism industry.

Comparison with Competitors:

Excellent Competitor Company A (65% repeat rate): - Acquisition: 20,000 monthly (fewer but higher quality) - Activation: 92% (same level) - Retention: 65% (overwhelmingly high) - Referral: 45% (overwhelmingly high) - Revenue: Customer lifetime value ¥185,000

Company A's Success Factors: - Personalized continuing experiences - Post-tour follow-up system - Community formation connecting customers - Graduated experience program design

Prasart was astonished.

"We were providing 'tourism' but failed to build 'relationships.'"

Chapter 4: The True Identity of the Phantom — The Trap of One-time Amazement

Detailed AARRR analysis and customer interviews revealed the fundamental problem structure of Paradise Tours.

Structural Analysis of "Satisfied One-time Customer" Phenomenon:

Root Cause: Experience Design Philosophy

Paradise Tours specialized in providing "perfect one-time experiences" but completely lacked the perspective of "building ongoing relationships."

Problems with Current Experience Design: 1. Complete-type experience: Designed to conclude in one tour 2. Uniform service: Same experience provided to all customers 3. One-way provision: Unidirectional value provision from company to customer 4. Relationship neglect: No relationship building with customers after tours

Customer Psychological Change Pattern:

Pre-tour: Expectation "Looking forward to Paradise Tours!"

During tour: Satisfaction "As expected, wonderful experience"

Post-tour: Sense of completion "Good memories. That's enough"

3 months later: Forgetting "Paradise Tours? I think I used them before..."

Customer Interview Revealed True Feelings:

Reasons for Not Repeating (Additional Survey of Satisfied Customers):

"The tour itself was wonderful, but I can't find a reason to go 'again'" (Singapore office worker)

"There are other places I want to go, and I don't feel the need for the same company" (Thai housewife)

"Precisely because I was satisfied, I want to seek different experiences next" (Malaysian business owner)

Most Important Discovery: Tourism Industry's "Satisfaction Trap"

In the tourism industry, the more satisfied customers become, the more they feel "complete," and the less reason they have to reuse the same company. A paradoxical structure where "satisfaction" creates "departure."

Industry Expert Analysis: "Companies that succeed in tourism don't design 'one perfect experience' but 'continuous value provision.' It's important to expand the relationship with customers from 'tours' to 'lifestyle.'"

Paradise Tours' Critical Design Flaws: - No post-tour follow-up (zero contact) - No pathway design for next usage - No response to customer growth/changes - No community formation efforts - Lack of personalization

Chapter 5: Detective's AARRR Analysis — Mechanisms That Call for Return Visits

Holmes summarized the comprehensive analysis.

"Mr. Prasart, the essence of the AARRR model is 'optimization of the entire customer lifecycle.' Even excellent acquisition and activation become unsustainable growth without continuity. True success lies in building long-term relationships with customers."

AARRR Integration Strategy: From "One-time Amazement" to "Lifetime Journey"

New Design Philosophy: Lifetime Travel Partnership

Phase 1: Retention Revolution (3 months)

Redesigning Continuous Experience:

Post-tour Engagement: - Within 24 hours: Automatic generation and delivery of travel memory videos - Within 1 week: Personalized proposals for next tours - Within 1 month: Continued delivery of local information - Within 3 months: Special offer provision

Graduated Experience Program: - Level 1: Beginner tours (current main focus) - Level 2: Deep-dive tours for repeaters - Level 3: VIP premium experiences - Level 4: Community events and special projects

Enhanced Personalization: - Proposals based on customer travel history - Learning and utilizing interests - Proposals aligned with seasons and anniversaries - Family structure and life stage adaptation

Phase 2: Referral Promotion (2 months)

Word-of-mouth Creation System: - Direction and recording of special moments during tours - Strategic placement of Instagram-worthy spots - Automatic generation of shareable content - Enhanced referral benefit programs

Community Formation: - Paradise Tours enthusiast community - Travel experience sharing platform - Member-exclusive events - Promoting interaction among customers

Phase 3: Revenue Maximization (Ongoing)

Improving Customer Lifetime Value: - Introduction of annual passport system - Expansion of travel-related services - Additional sales of local activities - Sales of travel goods and souvenirs

Revenue Model Diversification: - Subscription-type services - Premium membership system - Corporate incentive tours - Online travel experience services

Target Setting (After 12 months): - Repeat rate: 12% → 45% (achieving industry average) - Referral rate: 3% → 20% (achieving industry average) - Customer lifetime value: ¥38,000 → ¥120,000 (3x improvement) - Annual revenue: ¥48 billion → ¥65 billion (repeat effect)

"The key is transforming the relationship with customers from 'transactions' to 'partnerships.' Not one perfect experience, but lifetime value provision is true success."

Chapter 6: First Steps Toward Reproducibility — From Phantom to Solid Relationships

Eight months later, a report arrived from Paradise Tours Asia.

Results of Customer Relationship Transformation through AARRR Integration Strategy:

Dramatic Improvement in Retention: - 3-month repeat rate: 12% → 38% (3x improvement) - 6-month repeat rate: 18% → 52% (exceeding industry average) - 1-year repeat rate: 22% → 61% (reaching industry average) - Average usage frequency of continuing customers: 1.3 → 3.1 times

Referral Activation: - Word-of-mouth posting rate: 8% → 28% (achieving industry average) - Friend referral rate: 3% → 18% (6x improvement) - SNS share rate: 5% → 31% (exceeding industry average) - Community participants: 15,000 members (newly established)

Revenue Improvement: - Customer lifetime value: ¥38,000 → ¥115,000 (3x improvement) - Annual revenue: ¥48 billion → ¥62.5 billion (30% increase) - Profit margin: 15% → 28% (efficiency improvement through repeat effect) - New customer acquisition cost: 50% reduction (referral effect)

Qualitative Changes in Customer Relationships: - Customer satisfaction: 4.2/5 → 4.7/5 (relationship improvement effect) - Brand loyalty: Unmeasurable → 85% (high attachment formation) - Community engagement: Stable at high level - Spontaneous brand advocacy by long-term customers: 200 cases monthly

Success of New Services: - Annual passport members: 8,500 members (95% high repeat rate) - Premium members: 2,800 members (high revenue contribution) - Online travel experiences: 12,000 monthly participants - Corporate services: ¥8.5 billion annually as new business

Organizational and Operational Transformation: - Customer Success department newly established: 30 dedicated staff - Enhanced data analysis capability: Precise customer behavior analysis - Service design philosophy: Shift from "experience provision" to "relationship building" - Employee satisfaction: +45% improvement (sensing deep customer relationships)

Prasart's letter contained deep emotion and learning:

"Through AARRR analysis, we were able to shift from 'glamorous phantoms' to 'solid relationships.' The most important thing was understanding that 'satisfaction' and 'continuity' are completely different concepts. Not one-time perfect experiences, but lifetime value provision is the true mission of service industry. Now our relationships with customers have become our most precious asset, and new value continuously emerges from these relationships."

Detective's Perspective — Volume XVII "The Challenge of Reproducibility" Begins

That night, reflecting on the first case of the new volume, I pondered.

As the memorable 221st case opening Volume XVII "The Challenge of Reproducibility," Paradise Tours' case provided important insights. True reproducibility doesn't lie in repeating one-time success, but in building sustainable relationships with customers.

The true value of the AARRR model lies in its ability to view the entire customer lifecycle and optimize each stage. Particularly in "experience industries" like tourism, there exists a significant gap between customer "satisfaction" and "continuity." Bridging this gap becomes the key to sustainable growth.

Paradise Tours' transformation demonstrated a fundamental shift in business model design philosophy. From "one-time amazement" to "lifetime journey partners." This transformation becomes the source of true reproducibility.

"Reproducibility is not repeating the same things. It is continuously deepening valuable relationships."

Volume XVII will explore the essence of sustainability faced by modern enterprises through ten different companies' reproducibility challenges.

"True success begins with carving permanent value into customers' hearts. AARRR is the compass for measuring, nurturing, and expanding that value." — From the Detective's Notes