With $27 billion in sales, Staples serves businesses of all sizes and consumers in 27 countries throughout North and South America, Europe, Asia and Australia. Staples invented the office superstore concept in 1986 and has become the world's largest office products company, making it easy for customers to buy a wide range of office products, including supplies, technology, furniture and business services.
Over the years, Staples discovered that the best way to grow its business and build loyalty was to analyze the purchasing patterns of its core customers – both online and through retail business channels – and target them with relevant, profit-generating offers. To do that, Staples is using SAS Analytics for predictive modeling and customer insight, and SAS Marketing Automation to fine-tune its marketing campaigns.
"Customers are interested in faster and more efficient ways of ordering from us – they want the information at their fingertips to inform their buying decisions,” says Jim Foreman, Director of Circulation and Analytics at Staples. "There's a substantial part of the retail customer base that engages us online and uses the website not as their primary means of shopping, but to research a product. They might use it to find the closest store or quickly see what's currently on sale. That's all relevant to the retail side of the house. My team is involved in the analysis of online and offline customer behavior, building linkages between the two to give us a complete picture of the customer."
With well over 25 million customer records, Foreman says the customer data and information his group produces has helped strengthen synergies between the online, retail, catalog, loyalty marketing and merchandising groups.
"It was evident that as we got more advanced with analytics, we needed to better translate the insight into actionable and profit-generating campaigns," says Foreman. "One of the biggest things that SAS Marketing Automation did for us was to help bridge the great work we were doing on the analytics side with the campaign generation and execution side. We can now go to market very quickly and easily, based on insight, and realize significant benefits."
According to Foreman, Staples executes nearly 1,500 multichannel campaigns annually across a wide range of geographies, and has realized significant returns from SAS Marketing Automation, including increased capabilities to cross-sell, up-sell and personalize customer offers.
"We did a financial analysis of the implementation, and we found that we were getting an internal rate of return (IRR) of 137 percent," explains Foreman. "That's about as much of a slam dunk as you're going to see."
"We have several models that attempt to predict customer attrition," says Foreman. "These models allow us to look at an individual customer's purchase history and model that customer's buying pattern. We score customer models frequently enough to know that if a certain amount of time goes by between a customer's purchases, a flag is raised identifying the risk of attrition. There may be a hundred reasons why, but if there is an issue, our insight allows us to take action proactively before that customer switches to another provider and builds loyalty elsewhere.
"Our data is one of the most valuable assets we have. Given the company’s investment in data acquisition and storage, you want to be able to mine it effectively and discover nuggets that can generate incremental sales and profit. It's a shame when you do all the work and you can’t produce actionable results because your existing tools can't facilitate the transition from an analysis to a campaign. SAS Marketing Automation does that for us."
Foreman says the implementation of the SAS solution has also provided significant gains in efficiency, and he has been able to reduce the use of contractors to execute campaigns, which has contributed further cost savings. "Without doing any new campaigns, or generating any additional revenue, the cost savings from optimizing our execution process alone would have paid for the cost of the solution within two years. We couldn't be happier with it.
"Associates both on my team, as well as elsewhere in the company, have been using analytics from SAS for a long time," continues Foreman. "As well as their skills, we can leverage their code and bring it seamlessly into the campaign solution. Reuse of completed work provides real efficiency gains.
"SAS Marketing Automation was the right choice for Staples because of the integration capabilities. It was very important for us to score models within the campaign tool itself. We don't want to have additional processes to score models externally, which would necessitate the need to import and translate scores back into the campaigns. The SAS solution lets us bring models, as well as other non-modeled segments, directly into our campaign diagram, and it just executes as part of the campaign. There's no data back and forth. The efficiency is really unparalleled."