Improve customer retention strategy and business margins by leveraging customer profitability insights

Background

Active in more than 30 countries with 30,000 employees, our client is a leading worldwide provider of sustainable packaging solutions, paper products, and recycling services. With a large portfolio of customers, the management team needed an in-depth understanding of which customers are more profitable in order to make more strategic decisions.

Technology partners

IBM

IBM is a leading global hybrid cloud and AI, and business services provider. They help clients capitalize on insights from their data, streamline business processes, reduce costs, and gain a competitive edge in their industries.

10

years of partneship

2x

Gold Partner: Analytics and Data science

Challenge

Customer profitability is not only measured by the revenue a customer brings, but also by the related fixed and variable costs, the effort needed to maintain the customer, and the effect the customer has on the reputation of the client. A key challenge is to combine these factors to accurately define which customers are positively impacting business margins.

Approach

- Standardize cost and cost measurement principles across 17 countries and ERP systems. - Harmonize business definitions and resolve data quality issues by implementing a master data management solution. - Create a dynamic reporting system, providing business users with a visual method for defining which customers to retain. A whale curve graph allows end users to dive into all available profitability details per customer.

Key results

01
Standardized business definitions on cost drivers and profitability measurement
02
High data quality
03
Intuitive and user-friendly visual analysis on an organizational and customer level

Benefits

Our client gained a better understanding of customer profitability by grouping all available information into customer profitability segments and regions. This enabled them to establish benchmarks to take more strategic actions, resulting in a significant increase in overall profitability.

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