One of my retail client wanted consultancy to increase revenue by having new customer acquisition. And the acquisition had to be performed without spending on advertisement due to drooping cash flow." To kick start the project, I studied the following data -
a) bills for last 2 years to understand the highly selling products
b) territory of sales based on firms capacity
After analyzing the bills, it became evident that 20% of products generate 80% of revenue. Next I studied the attributes of the product & services which makes the offering differentiated in the market.
Most of the attributes like discount rate were offered by all the retail shops. We had to work on a few attributes like return policy intentionally to make the offering unique. It also required my client to add new elements in his ecosystem. For example on the return policy, my cent had to initiate business with a few shops in rural areas who were ready to purchase the used medicines at 75% of wholesale cost (this is just an example). We also agreed that this will be kept as trade secret because this is going to provide competitive advantage to my client and also increase market share. Now the big question was to reach out to retail customers and also to categorize them based on their needs. The biggest challenge was that we did not have budget for advertisement.
Conjoint analysis (a sort of survey)is primarily used to get customer preferences for a product or service. I chose conjoint analysis for new customer acquisition. Since there are 2 parts in the survey to gather inputs from retail customers. First is the demographic details and second is the rankings of attributes of the product or service. The demographic details provide customer name & requirements which can be used for new customer acquisition. The ranking section helps in understanding the preference of customer, hence helps in understanding the way we should approach a new customer" Over time I have developed customized survey platform, design of experiments software and an analysis SW. My client directed his workforce to visit different areas in his territory of operation to get the survey filled by residents. In weeks time I had lot of data on my table. On analyzing the data, I was able to provide following to my client -
a) customer segmentation based on individual needs
b) Names & phone numbers of each customer to connect with them c) profitability of my client
d) market share in the given territory of operation
bolgdown
In the end some of the learning were -
a) have some unique attribute for your offering
b) if uniqueness is not there, think and inject some uniqueness in the offering
c) reach out to perspective customers to get connected and get their liking using conjoint analysis survey
d) always make data driven decisions (conjoint analysis)
We are tracking new customer revenue for last 3 months and we are seeing 20-30 new customers every month. In case you or your connections are into retail business, I highly recommend performing conjoint analysis for new customer acquisition in the business.