Case Study – Customer Loyalty Analytics

Industry

Retail Apparel Industry

Function

Customer Loyalty Analytics

Business Challenge

The client is the largest department store and fashion apparel retailer in the Middle East with over 120 stores, faced declining spending among core customers, leading to de-growth.

Project Objective

Enhance brand patronage and continuous engagement
Increase share of wallet
Reduce dormant customer base
Re-engage churned customers

Approach & Solution

Three key customer segments were identified:

Premium Customers: Implemented an ATV-based threshold program to incentivize increased spending.
Dormant Customers: Targeted selected high-propensity customers with ATV threshold incentives.
Churned Customers: Utilized a customer response model to offer loyalty incentives across various segments.

Project Outcome

The campaign proved highly effective and was adopted as a regular program across GCC countries.

Premium Customers: Achieved a 52% response rate, with a 54% YOY uplift in ATV of responders (Rev/Cost ratio: 98).
Dormant Customers: Achieved a 13% response rate, with a 5% YOY uplift in ATV of responders (Rev/Cost ratio: 37).
Churned Customers: Achieved a 5% response rate, generating AED 3.3 million in revenue from inactive customers (Rev/Cost ratio: 26).