How can we explain the recent 20% decrease in average transaction value for Sunbit's point-of-sale lending product in the dental industry?

Introduction

The recent 20% decrease in average transaction value for Sunbit's point-of-sale lending product in the dental industry is a significant concern that requires thorough investigation. To address this issue, I'll employ a systematic approach to identify, validate, and resolve the root cause while considering both immediate and long-term implications.

Step 1

Clarifying Questions (3 minutes)

• Looking at the timeframe, I'm wondering about the specific period of this decline. Has this 20% decrease occurred over the last quarter, or is it a more recent trend?

Why it matters: Understanding the timeline helps identify potential correlations with external events or internal changes. Expected answer: The decline has been observed over the past 3 months. Impact on approach: A longer timeframe might suggest a gradual shift in market conditions, while a sudden drop could point to a specific trigger event.

• Considering user segments, I'm curious if this decrease is uniform across all dental procedures or if it's more pronounced in certain types of treatments?

Why it matters: This helps us understand if the issue is global or specific to certain product offerings. Expected answer: The decrease is more significant in elective procedures like cosmetic dentistry. Impact on approach: If specific to certain procedures, we'd focus on those particular offerings and their unique characteristics.

• Thinking about recent changes, have there been any updates to Sunbit's lending terms, approval process, or user interface in the past few months?

Why it matters: Internal changes could directly impact user behavior and transaction values. Expected answer: A new risk assessment algorithm was implemented two months ago. Impact on approach: This would shift our focus to the potential unintended consequences of the new algorithm.

• Regarding market dynamics, has there been any significant shift in competitor offerings or marketing strategies in the dental financing space recently?

Why it matters: External competitive pressures could be influencing customer choices and transaction values. Expected answer: A major competitor recently launched a 0% interest promotion for dental procedures. Impact on approach: We'd need to evaluate our competitive positioning and value proposition.