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Build a business case: developing custom apps

Workshop Once you have measured customer purchases using the RFM (recency, frequency, money) formula, the question is how do you drive loyalty with the information you hold.

The chances are your customers would be happier, and therefore more loyal, if they felt your organisation cared about them as individuals, not just walking wallets or anonymous account numbers. And sales people can make customers feel this way if they have access to more information.

Knowing more about clients – their past purchases, consumption rates, likes and dislikes – makes it easier for the sales person to match their needs with what you sell.

Financial services firms can be quite poor at this. How many times has your bank tried to cross-sell you a product you have already bought? Having grown by acquisition, banks often suffer from silo databases referenced by account number rather than customer.

“To generate loyalty you need to know basic stuff like whether the customer you are talking to has one product or seven, or how active they are,” says Dale Vile of the analyst firm Freeform Dynamics.

“Lots of companies, especially in finance, have ended up with discrete systems for each product, so a single view of the customer is difficult. But you can do some integration work or port across into a data warehouse to fix this.”

How you present customer information to sales people and how detailed it needs to be depends on the type of business you are (for example B2B or B2C), the type of customers you have (for example a small number of high-value frequent customers or a large number of lower-value ones), and how your sales force operates (for example field or telesales).

What you sell also has to be taken into account. Complex offerings will require richer information in the hands of the sales people so they can match customer requirements with benefits.

Timber frame

Let’s take as an example of Burt Boulton & Haywood, a UK company which has been in the timber business since 1848 and is now part of the Finnforest group, Europe's largest wood products corporation. The company manufactures power transmission and telephone poles, sleepers, crossing timbers, fencing materials and other preserved timber products.

BBH used to principally just sell poles to a small number of major clients, but now sells a wider range of products to many more customers. The loyalty of satisfied customers is vital to the business.

And those customers are super-fussy about their timber products. The days are long gone when you could find a tree, cut it down and mill it into planks – at least in this country. Timber is now a highly regulated industry and customers demand environmentally sound products from renewable managed forests.

To cope with expansion, BBH upgraded to a Sage ERP 1000 system. Obviously this has made a difference to back-office operations, but the system is also integrated to provide information to the sales force.

“Having end-to-end visibility of our business has made a huge difference to our ability to open up new opportunities,” says Steven Harris, head of IT at BBH.

Vision thing

“Previously, sales people could not see what was happening at the back end. Now they can do a full analysis of customers by product, sales history, credit record and so on. The system provides all the information needed to build good relationships.

“We are becoming more marketing-focused and more proactive at selling. For instance, if we have a large stock of a particular product such as fencing timber, we can identify who has bought that item in the past and target them to see if they require more.”

BBH’s sales administrators are the main point of contact with customers, so the system gives them a complete sales history, from original enquiry through order processing to invoicing.

Previously, quotations were faxed to customers. When a query came through it was difficult for another member of staff to resolve. Now anyone can view previous communications and answer the query there and then.

The integration has also been extended to canvassing customers for their views every month.

“Again, the system will enable us to pull data from the back end to view recent orders, and contact the customer to check everything has gone well. Of course, this will also create opportunities to discuss any additional requirements they may have,” says Harris.

And in one extra bit of loyalty-driving integration, BBH’s production managers can monitor outstanding orders to ensure they are fulfilled on time. ®

Build a business case: developing custom apps

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