Managing and Growing Underserved Accounts

Managing and Growing Underserved Accounts

AT A GLANCE

COMPANY TYPE
National HVAC Distributor

TARGET AUDIENCE
Small and medium contractors

SIZE OF AUDIENCE
40,126 Accounts

TIMELINE
Six years

RESULTS

25%
Outperformed the downward trending market by 25%

19:1
Return on investment

20%
Through first five years, have averaged over 20% growth each year

$250M
Total cumulative sales growth approaching $250M

OVERVIEW

Modern Marketing Concepts was hired as a channel partner to diversify the business of a world leader in building products distribution. MMC was able to aggressively target the add-on and replacement segment of the business that had been neglected during the "boom years" of new home construction.

This was done by implementing Channel 80/20; a sales channel that this particular client selected to focus on the long tail of customers not possible to reach using field sales alone. By deploying Channel 80/20, the client had a cost-appropriate channel for low-end dealers, which then allowed them to focus field sales resources on higher-end accounts.

CHALLENGE

A world leader in the heating, ventilation and air conditioning (HVAC) industry faced a tough challenge…construction of new homes was slowing significantly, which meant less revenue from this all-important segment of business. To meet that challenge, they made the decision to diversify their business by targeting the add-on and replacement market segments.

The key to growing the add-on and replacement market was to direct the sales force to increase engagement with the smaller, hard to reach dealers. Growing their dealer base was the primary objective, but the client also needed to improve the creation of long-term loyalty to their products by re-energizing their established relationships.

By deploying the Channel 80/20 strategy, the client created a cost-appropriate channel for smaller dealers, which then allowed them to focus more of their field sales resources on higher-end accounts.

Challenges

SOLUTION

Channel 80/20 services begin and end with data. At the outset, transactional sales data was analyzed to identify the customers’ current value and behavior patterns. As MMC's marketing engine matured and additional information was collected from customers, a model based on unrealized purchase potential was created to help prioritize marketing efforts to the highest yield opportunities.

Upon completion of the initial analyses, the next step was to determine how frequently customers would be contacted and what messages would be sent to them. MMC designed these campaigns to be consistent with the client’s brand guidelines, and also repurposed existing client materials for more effective and direct one-to-one messaging. The campaigns were multi-touch and multichannel, executed via telephone, direct mail, Email, digital outreach, and item fulfillment.

MMC handled the full range of customer communications, from capturing additional account data during each interaction and nurturing opportunities, to closing sales and analyzing lost sales. Each and every customer interaction was stored in a proprietary database which allowed for complete 360-degree campaign planning, execution, and analysis. That analysis facilitated ongoing targeting and refinement of campaigns and significant enhancement of the overall program.

RESULTS

Within 12 months of deploying Channel 80/20, the accounts managed by MMC outperformed the downward-trending market by 25%, providing a 19:1 return on investment, thus earning "best-practice" status with the client. Channel 80/20 has now become a powerful tool across the client’s North American operations and has expanded to interdependent distribution partners as well.

Are you a distributor or manufacturer with direct sales force deployed against long-tail customer markets?

Contact us today to learn how Channel 80/20 can help you achieve the outcomes you're looking for.

mmcbuildingproducts.com | bpinfo@mmcglobal.com | 800-720-1656

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