Customer Intensification Process (CIP)
You know in great detail what you sell. What you don’t know is what your current customers don’t buy from you!
For established retailers, the easiest, fastest, and least risky path to increase sales and profitability starts with existing customers. To help retailers get inside the mind of these customers, the Customer Intensification Process (CIP). CIP helps retailers prioritize their resources to get more sales and profits from current customers. It provides actionable answers to questions like:
- How much revenue and profit is “leaking away” to your various competitors?
- Why is this leakage occurring? How can it be stopped?
- What is the potential monetary value (in terms of both revenue and profit) of your various customer segments?
- What “hidden demand” exists in different merchandise categories, brands, styles, price zones, size scales, store formats, regions, and markets?
- What is the monetary value of various marketing, customer service, merchandising, and store design initiatives?
The CIP approach clearly highlights the merchandise, design, and operational “barriers” that prevent your customers from buying more from your stores. All identified opportunities are quantified in dollars and cents. They are then prioritized to help in designing the best approach to revenue and profit growth.
What Is the Customer Intensification Process?
CIP is a unique, proprietary program that links the information in your customer and transaction databases – containing information about what your customers buy – with comprehensive customer store exit surveys to find out what your customers don’t buy from you – and why. The process exposes areas you have already saturated and discovers other areas of untapped potential. It is used to provide specific guidelines for buyers to tailor the assortment to be more “in-tune” with un-met customer requirements.
- Focuses on Actionable Results – To get needed “buy-in” and ensure that findings are actionable at the tactical level, CIP involves your buyers from the inception and tailors the outputs to their needs. Buyers are provided with the information they require – at the merchandise classification level – to position the offer to be more in-tune with the needs and wants of regular and repeat shoppers.
- Comprehensive Category Coverage – Every merchandise class is analyzed individually, since each one faces a separate set of competitors and issues. At the classification level, the CIP results provide buyers with information about competitor shares, style preferences (using photographic images), size scales, price point opportunities, and even product details.
- Aligns Your Offer with the Needs of Your Most Valuable Customers – To make your offer more consistent with the needs of your most valuable customers across the range, CIP provides product size scales and pricing guidelines that illustrate price points and price zones for every class of merchandise. These guidelines can be used to maximize cross-classification purchasing.
- Links Store Features to Sales and Profit Improvement – CIP can be used to provide thorough feedback to operations personnel about in-store presentation, layout, and customer service features that most influence the overall perceptions of the customers offering the greatest potential.
How Does the Customer Intensification Process Work?
The Customer Intensification Process utilizes a proprietary software program—developed over the course of two decades—to provide highly effective data capture and analysis processes that deliver hard-hitting results.
- Information Is Gathered From Customers While the Shopping Experience Is Fresh in their Minds – A computer-assisted exit interview program is used to collect information from a scientific sample of about 10,000 of your regular customers. Surveys are completed on touchscreen computer kiosks temporarily installed near the exits of a representative sample of your stores for a period of approximately two to four weeks. Data about “lost” transactions is collected while customers are in the stores – and the experience is fresh in their minds – whether they purchased that day or not.
- Utilizes Comprehensive Yet Shopper-Friendly Surveys – A sophisticated custom software and hardware system permits hundreds of questions to be included in the survey database, while at the same time limiting the duration of the average interview to just a few minutes. Artificial intelligence algorithms make this possible, allowing a hugely complex questionnaire to appear short, simple, and to-the-point to the customer. By interviewing thousands of customers and analyzing tens of thousands of transactions – rather than millions – CIP reports more useful information (at a fraction of the time and cost) than typically provided by the “mining” of data warehouses. Moreover, data warehouses don’t contain information on lost transactions – or the reasons why customers buy elsewhere.
- Leverages Existing Financial and Customer Data – Once the primary data is collected from customers it is merged with extracts from your financial, customer, transaction, and other databases. The linkages to your category-level transaction, profitability and productivity data allow all opportunities to be quantified and monetized so they can be prioritized and resources (inventory, personnel, selling space) allocated more productively – making existing stores more productive.