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Client: A $50 million/year national distributor of telecommunications equipment and electronic components. |
Challenges: Our client had an excelleint reputation as a long-established vendor of specialized telecommunications equipment. However, the deregulation of the telephone industry had forced the company into direct competition with other wholesale vendors of general-purpose electronic equipment and components. The challenge was how to quickly help the company maintain is position in the face of all of the new competition.
Solution: We recognized that our client had excellent penetration into their target markets and already were selling to most of the customers in these markets. However, they were selling only a very narrow selection of products.
We developed a specialized "product diversity" database by using data extracted from our client's mainframe systems. Next, we segmented customers according to the number of product lines purchased. Then we developed a cross-purchase product analysis that identified which products "clustered" together, meaning that if a customer bought one or two products in a cluster, they might be interested in other products in the same cluster.
Our client used this analysis to guide their sales and marketing efforts with narrowly-focused customer-specific offers. These offers encouraged the customer to purchase items that were related or complementary to those which they were already buying from our client.
Result: Our client used this analysis to greatly boost sales with narrowly-focused customer-specific offers. These offers encouraged the customer to purchase items that were related or complementary to those specific items which they were already buying from our client.
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