Redcats USA gains customer insights from SAS® to acquire, retain and grow the most profitable customers
It’s a challenge faced by all retailers: how to acquire, retain and grow customers most profitably. Retailers can easily spend more money acquiring a customer, whether in expensive catalog mailings or promotional discounts, than the customer might be worth long-term to the brand. Savvy retailers, like Redcats USA, use SAS Business Analytics to understand customers’ buying behaviors, tailor relevant and profitable promotions for growth and retention, and provide the business with a wealth of information for better decision making. Additionally, the strategy employed at Redcats USA has helped the No. 3 US catalog retailer shave hundreds of thousands of dollars from its marketing expenses.
Part of the global Redcats Group, (US$4.6 billion), Redcats USA markets clothing brands such as Woman Within®, Roaman’s®, KingSize®, Jessica London®, BCO®, Avenue® and OneStopPlus.com®. It also sells home fashions and sporting goods through BrylaneHome®, The Sportsman’s Guide® and The Golf Warehouse®. It appeals to value and mid-market shoppers, giving the company an important edge in tough economic times. But like any multi-brand catalog retailer it has a big challenge: efficiently acquiring and keeping customers across all the brands.
Redcats USA previously had significant manual effort involved in its business processes. With SAS, Redcats USA can measure the effectiveness of its promotional strategies, determine how to spend its catalog and promotional dollars, and communicate critical information with and among business users.
Better understanding of the customer, better use of marketing budget
“We needed to know the impact of receiving one catalog or multiple catalogs and understand which catalogs a customer should receive,’’ explains Dan Hatola, Vice President of Database Marketing for Redcats USA.
Reduced costs and increased productivity
With SAS, Redcats USA can build a model in a few days -- allowing the company to build three times as many models and quickly bring new modelers up to speed. The company can also build more detailed models.
SAS also helps the company determine which brand provides the best entry port for potential customers. “If one brand can bring in a customer for $5 while another brand spends $50, we should be focusing on bringing customers to us on the less expensive (to market) brand and then try to market internally to get them interested in a sister brand,’’ Hatola explains.
Finally, SAS helps Redcats USA with Web analytics. Redcats USA is segmenting these customers to determine which ones receive catalogs and whether they can receive fewer catalogs and still shop online. “We’ve significantly reduced catalog contacts,’’ Hatola says.
Going beyond recency, frequency and monetary segmentation
The net impact of these modeling efforts is that Redcats USA has grown revenue per catalog, while trimming its mailing list. “There is a huge competitive advantage to using models over RFM,” Hatola says.
Getting data to the right people in the right format
Redcats USA chose the SAS enterprise business intelligence solution because of the flexibility and ability to build analytics behind the reporting. About 50 Redcats USA business users with no programming or analytic skills can easily access and manipulate data to get the answers they need – without making requests to the IT department. “One of the things that stood out about SAS was the integration with the mainframe,’’ Dare says.
“Business users used to have to copy and paste a lot of things. It was very cumbersome,’’ Hatola explains. “Now we’ve got daily reporting using SAS that can be accessed through Excel. We’ve created a bunch of dashboards and drop-down menus. It is very popular, very fast and just a lot easier.’’
Overall, SAS has been an efficiency driver for Redcats USA. “SAS provides a lot of power and flexibility to do very in-depth analysis without having to have a strong programming background. We can do things faster, with more accuracy and consistency because of the stored processes. It doesn’t matter who runs the report, the output is derived the same way,’’ Hatola says.
The results illustrated in this article are specific to the particular situations, business models, data input, and computing environments described herein. Each SAS customer’s experience is unique based on business and technical variables and all statements must be considered non-typical. Actual savings, results, and performance characteristics will vary depending on individual customer configurations and conditions. SAS does not guarantee or represent that every customer will achieve similar results. The only warranties for SAS products and services are those that are set forth in the express warranty statements in the written agreement for such products and services. Nothing herein should be construed as constituting an additional warranty. Customers have shared their successes with SAS as part of an agreed-upon contractual exchange or project success summarization following a successful implementation of SAS software. Brand and product names are trademarks of their respective companies.
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Model the customer database to trim catalog mailings, build revenue per catalog and share key data with business users in an easy-to-digest fashion
Models that once took a few weeks to create now take days or even hours. The models have helped drive down marketing costs and increase customer profitability. Business users can access data they trust in an easy-to-use format
“SAS provides a lot of power and flexibility to do very in-depth analysis. … We can do things faster, with more accuracy and consistency.”
Vice President, Database Marketing