Portfolio Analysis
Customer Portfolio Analysis
Customer relationship management is increasingly important in current marketing research and practice. The customer portfolio models represent one of the few concrete tools proposed for relationship management in business-to-business markets.
Customer portfolio is a tool used mainly by B2B companies to help organize and develop a valuable communication/relationship with customers. It’s usually associated with some kind of technology, such as an ERP, CRM or a database that stores all of the information below:
- Name of the company;
- Contacts and associates;
- Business and segment;
- Products or services acquired;
- Billing information, as well as average ticket and total revenue.
You can also have other information on their profile, such as Customer Service Needs, Profitability, type of relationship, and potential additional sales. These information will be, during the customer portfolio management, your criteria for evaluating the relationship and prioritize certain accounts over others.
Why it is important to do customer portfolio management? Dormant databases (meaning they are not properly managed) have an average 50% of inactive customers. That’s because companies, especially big ones or with more than 5 years on the market, have not changed how they do things. This means that millions of potential revenue are just sitting there, waiting to go to other companies.
Customer portfolio management prevents that. By knowing the companies that you have or had a relationship with, you can prioritize contact and customize service in order to keep everyone happy while extracting the most revenue out of these business opportunities. You can also discard companies that don’t have the right fit or that are not bringing the expected return, giving the space to new ones.
Customer portfolio management is not only a tool for organization, but is strategic in knowing your customers and what type of account you should be targeting. It might also help you think of new sales strategies, such as upselling, in order to increase revenue per client. All of these benefits will allow your business to grow even more, and actually be able to profit from your entire customer portfolio.
And by paying attention to your customers’ behavior, it’s easier to detect pre-churn.
Once you know which clients are in danger and which present an opportunity for a bigger ticket, it’s time to build a retention flow and choose the perfect automation platform.
Businesses are constantly seeking new insights, thought leadership and resources from the supplier community to help them win in today’s competitive market. Nowadays, suppliers have several distribution options including their own direct-to-consumer channel. As such, leading businesses recognize the need to form strategic relationships with the appropriate suppliers. The challenge often lies in the criteria related to selecting the right supplier partners:
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How do I determine the value of suppliers today and in the future?
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How should I measure their contribution to my business considering their loyalty, objectivity, exclusive offers, discretionary funding, talent, insights, tools, ideas, brands, values, etc.?
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How do I measure their alignment with my strategy?
Our supplier segmentation model insures that our clients are properly assessing and selecting the optimal partners to support their strategy and success.
A partial list of our consulting services includes:
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Supplier Segmentation Criteria – Identification and definition of the critical comparative components to fuel the supplier segmentation.
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Segmentation Model & Analytics – Development and execution of the underlying quantitative and qualitative analysis that will create the foundation of comparison among the array of suppliers. Identification of segmenting factors.
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Segmentation Objectives & Expectations – The objectives and expectations of the retailer-supplier relationship, roles and responsibilities for both parties by supplier segment.
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Segmentation Communication – The development of an internal and external communication plan to initiate and solidify the newly desired retailer-supplier relationships.
To be successful, a company should have a portfolio of products with different growth rates and different market shares. The portfolio composition is a function of the balance between cash flows. High growth products require cash inputs to grow. Low growth products should generate excess cash. Both kinds are needed simultaneously.
The business portfolio is one of the most crucial factors for any organization. Why? Because it is about what the organization plans, sells, and stops to sell.
The business portfolio must be based on the company’s mission, objectives and strategy, in order to fit the company’s strengths and weaknesses, philosophy and competencies to opportunities in the market environment.
To stay in business, a healthy and balanced, innovation-driven portfolio is absolutely crucial! Designing the business portfolio involves analysing the company’s current portfolio by a portfolio analysis, before strategies for growth and downsizing can be developed.
The business portfolio is the complete collection of products and businesses that make up a company. Designing and maintaining a healthy portfolio involves thorough understanding of the firm’s objectives and the markets it wants to serve.
- Products/ Services Portfolio Analysis And Segmentation
- Customers Portfolio Analysis And Segmentation
- Suppliers Portfolio Analysis And Segmentation
