Case Study - Electronic Supply Distributor

Issues:

Sales were relatively flat.  While some customers purchased multiple times, many purchased only once.  Customers averaged 1.4 transactions per year.  While the company had a database of over 1,000 customers, they did not maintain or use it to generate repeat business.

Our Goal:

To grow sales through existing customers, by improving the frequency and average sales amount per customer.

Actions Taken:

• Cleaned up database and removed 300 dead accounts.

• Established customer value criteria based on revenue and profitability; assigned codes to all customers in database.

• Established guidelines for contact frequency and method based on value code - and began implementing.

• Developed a quarterly 'stay connected' program that promoted the full range of products and exclusive offers for customers only.

• Systematized blanket order process for easy follow-up and re-ordering.
  

Results Achieved:

In 6 months, the average number of transactions increased 25% and the average sale increased 11%.  Without increased spending on marketing, revenues increased 21%.

Bonus: 

A few months later, when a key supplier notified the company of a pending price increase, the company had a simple, easy way to quickly email a 'Buy Now Avoid Price Increase' offer.  This effort generated over $50,000 in incremental sales and demonstrates the value of a well-maintained database.