Sales program evaluation and modelingDocument Transcript
Sales Program Evaluation and ModelingA large American Air Conditioning Solutions Company
inTouch has delivered year-on-year benefits to Sales Program Evaluation & Modeling several clients in a wide variety of businesses – Consumer, Retail, Ecommerce, Food & Beverages, Jewelry, Beauty & Healthcare, Education, Satellite and Web Communication, Petroleum, HR Services and more – overManager–Sales Analytics and Forecasting: .. scored very well on several long term and on-demandtheir very first engagement with us! engagements for the past 5 years. Salary Computational Tool for the largestClient Partner: We would love to partner with inTouch on each temp staffing business in India >> predictssuch opportunity .. this was a very successful project! market benchmarked salaries based on skills and attrition scores S t o r i e s Pricing and Discount Optimization for the world’s largest Satellite CommunicationinTouch was mandated by a USD 8 billion world leader in air business >> has delivered more than $100 million in potential annual savings for theconditioning systems, services and solutions, to model historical businesssales data and evaluate the effectiveness of the various S u c c e s spromotional programs carried out by the company over five Sales Program Effectiveness for America’syears. inTouch devised and delivered an advanced analytics largest Air conditioning systems provider >>solution working closely with key executives in the marketing has afforded visibility into rates of returndepartment of the company. delivered by various marketing programs across sales territories in North America Supply-Demand Matching & Optimization ToolThe case for a large Staffing Service provider in India >> has brought down doability turnaround from 3As part of a sales program, the client made off-season offers – weeks to across the table for the salesforceconsumer rebates, free extended warranties and consumerfinancing – to its home market segment in the US. The sales Topline growth oriented rewards programs forprogram was extended to the market through channel partners a market leading Filter Coffee business in Indiaduring Spring and Fall seasons each year. The client wanted to >> has delivered a 3-fold increase in revenues for 3 straight years for the 425 outlet chainunderstand what incremental volume, sales and margins aregenerated by the programs and identify programs that should beoffered in future. Customer Feedback Decision Support and Smart Response System for India’s largest fine dining restaurant chain and many more market leading café and QSR chains >> drives a significant percentage of repeat visits across the 20 outlet restaurant chain
Data and ApproachSecondary sales data – transactions made by the client with channel partners – and data onincentives, processed at a transactional level, for a time period of 5 years were made availablefor analysis by the client. Industry and company shipments and CDD (Cooling Degree Days)information pertaining to the same time frame were also provided. inTouch proposed anapproach that involved a multiplicative model of the Cobb Douglas function to model the data.Modeling the historicals The data preparation methodology included stitching incentive data to (secondary)transactional data and introducing a time period shift at the individual transaction level in a manner that very closely approximated consumer sales behaviour in the market. Achieving a great match between primary and secondary sales transaction data demanded a complex, many-to-many mapping of individual product models between the two sets of data – an aggregation and optimization technique run on several iterations to arrive at a close-to- perfect match.Data was then aggregated at a per month level for each product model sold by each channelpartner and advanced analytics models based on the Cobb Douglas function methodology builtyear-wise.The Business SolutionThe client derived extensive supportfrom the models for key decisions onwhat programs to offer in future and inwhat territories, what investmentswould be optimal at individualcampaign and overall program levels,and what product mix – premium andnon-premium – to push and sell underindividual campaigns.Models explained program performance in terms of the following metrics at an individualcampaign level –
1. Incremental Sales and Volumes 2. Incremental Margins and Rates of Return 3. Program efficiency in driving Value (mix of premium and non-premium product models) and 4. Impact on business if any or all of the programs were plugged outResults also included clustering channel partners based on program performance and on theabove parameters.BottomlineAnnual costs of the sales program were an estimated USD 4 million and estimated rates ofreturns varied extremely widely, from –53% to 36%. The predictive modeling solution helpedthe client prioritize promotional investments by season, geography and at product levels inorder that returns on investments made were optimized.
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