Case Study:
Hardware Distributor Customer Lift
CLIENT
For close to 50 years our client has been a leading provider of architectural door hardware products to dealers throughout the US.
THE CHALLENGE
To become the preferred supplier of hardware in their category.
KEY RESULTS
Year-over-year program
ROI
of
1649%
in sales growth
and
257% in
incremental gross profitability!
BACKGROUND
A hardware distributor in the northeast had a reputation for offering the best architectural hardware brands and legendary customer service but wanted more. Their goal was to improve market share and be the preferred supplier in their category.
Loyalty programs had never been used as a means to create sales growth, and the distributor felt that such a program could incentivize their existing customers to increase their category purchases as well as entice those using competing distributors to shift their business to them.
STRATEGY & IMPLEMENTATION
Lift & Shift created a program model structured to reward year-over-year growth with tiers. The client followed our loyalty program implementation best practices to the letter, not only providing enticing offers that attracted sales but also providing the additional marketing support that produces home runs. The client advertised the loyalty program at every opportunity. Their sales team made sure their customers knew what was available, they promoted the program on their website, and took advantage of the ability to create strategic bonus offers visible only to specific members based on their purchase history. They also partnered with their manufacturer partners, who were looking to market directly with their customers, adding vendor-funded, performance-based product bonus offers to showcase individual products for the distributor’s customers.
The results were outstanding. Not only did it result in major growth from customers consolidating their spending with them, but it also resulted in capturing sales from customers using competing distributors.
RESULTS
In year 1 of the program:
More Spending
Sales Growth year-over-year was $14M from enrolled members. This was a Sales Growth increase of 33% compared to 14.9% for non-members.
Strong Impact
Program ROI of 1649% in sales growth vs total program costs (including one-time startup costs).
Program ROI of 257% in incremental gross profitability vs total program costs (including one-time startup costs).