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Client: A $50 million/year national distributor of telecommunications equipment and telephone system components. |
Challenges: In the face of the recent recession, most customers cancelled major equipment orders and cut back on purchases of everything else. Our client's revenues dropped sharply, which cascaded into slashed marketing, advertising, and sales department budgets. Our client realized that their traditional strategy of finding new customers would become more difficult and expensive. In contrast, a more affordable strategy was to keep their established customers from leaving. The question was, how to do it?
Solution: Moving quickly was essential. First, we designed and developed a database specifically for marketing use. It stored selected data extracted from the company's mainframe systems and was updated on a regular basis. Next, we developed a pattern recognition procedure that described the buying patterns of each customer. Finally, we compared each customer's recent buying patterns to their historical buying patterns. By updating this comparison each month, we highlighted customers who were "drifting toward the back door" in time to contact them with a retention offer.
Result: With Management Analytics Group's help, our client focused their limited sales resources upon the key customers whose departure might not have been noticed until too late. This maximized the impact of limited budgets and staff and avoided serious erosion of their base of established customers.
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