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Case Studies
Learn more about G2 Knowledge Consulting success stories.
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Situation
Like most Retailers this organization had come to rely
heavily on discounting to drive store traffic. This
strategy was implemented mainly through monthly Direct
Mail to proprietary Credit Card Customers. It was apparent
that the discount strategy was limited and ineffective.
Solution
G2 Knowledge Consulting undertook a Customer Segmentation
Analysis, based on response history and patterns. Together
with a review of the discount strategy, this approach
was designed to identify shopping behaviors and frequencies
to determine the real driver for store purchases.
The
analysis uncovered that the current strategy was actually
running at a loss. The study isolated a single, sizeable
segment whose response was so poor that the cost of the
promotion far outweighed the impact of the offer, so
much so that this single segment was sinking the entire
program.
Result
The research ultimately determined that the real motivation
for most customer traffic / shopping was new merchandise.
After testing, it became clear that communications focused
on new items were much more effective at driving more
frequent and more profitable shopping. The client was
able to reduce the frequency and quantity of mailings,
while eliminating costly consumer incentives. This turned
a $500,000 loss into a $400,000 gain per program.
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