Sales were relatively flat at this electronic supply distributor. While some customers purchased multiple times, many purchased only once. Customers averaged 1.4 transactions per year. The company had a database of over 1,000 customers that they did not maintain or use it to generate repeat business.
To grow sales through existing customers by improving the frequency and average sales amount per customer.
- Cleaned up the database and removed 300 dead accounts.
- Established a customer value criteria based on revenue and profitability. Assigned value codes to all customers in the database.
- Established guidelines for contact frequency and method based on value code. Then began implementing phone follow-up calls at the designated frequency.
- Developed a quarterly program to stay in touch. Used the program to promote the full range of products and exclusive, customer-only offers.
- Systematized the blanket order process for easy follow-up and re-ordering.
In 6 months, the average number of transactions increased 25% and the average sale increased 11%. Without increased spending on marketing, revenues increased 21%.
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 the Price Increase’ offer. This effort generated over $50,000 in incremental sales and demonstrates the value of a well-maintained database.
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