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Identified customer and pricing initiatives to drive growth and drive business results.
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Business impact When implemented, recommendations on pricing and customer segmentation are expected to yield more than $100 million in revenue improvement.
Issue To meet their five-year growth and profitability targets, the client needed new strategies for pricing, account management and customer profitability.
Executive summary A food wholesaler conducted a study to identify pricing, account management and revenue optimization strategies to improve profit and growth.
What IBM did This national food wholesaler wanted a thorough, strategic examination of customer pricing, account management and revenue optimization to drive growth and profitability. IBM combined industry experts from IBM Global Business Services, world-class analytic skills from IBM Research and client specialists to do a discovery study identifying initiatives with high potential impact.
The team studied the food wholesaler’s current operations, reviewed industry practices, surveyed current and potential customers and conducted extensive analysis on a large set of actual, historical sales data.
Initiative recommendations covered the entire customer service cycle and focused on targeting underserved segments for accelerating growth, improving pricing decisions to increase account coverage, optimizing channel selection and identifying, retaining and expanding the best customer accounts. Potential impact, steps involved and estimated costs were all documented for each initiative.
Because of Research’s involvement, new insights into the client’s business results were developed and each initiative the IBM consultants identified was backed up by solid analytical evidence. The in-depth analysis helped the customer to pinpoint strategies and pricing methods for improved business results. More importantly, the strength of the facts and the analysis that was done allowed the client to develop a business case for implementing the initiatives.
Capabilities applied IBM Research’s experience in mathematical analysis comes from years of theoretical development across many mathematical disciplines. This powerful capability, coupled with the strategic industry expertise of IBM Global Business Services consultants, delivered recommendations designed to yield the results the client sought.
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Related case studies | 
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More on the issue | Driving an operational model that integrates customer segmentation with customer management Customer segmentation can help increase the number of customers as well as the amount of each customer transaction. It can also have an impact by helping to align costs to more economically serve each customer segment. |
More on research | IBM Merchandise and Inventory Management Group The IBM Merchandise and Inventory Management Group has a number of projects related to pricing. |
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