Marks & Spencer
Case Study
Website: http://www.lunchtogo-e.com
When Marks & Spencer launched their corporate food service, lunchtogo, they looked to capitalise on EWA’s experience in customer relationship management to deliver a best of breed service.
Background
In 1996, Marks & Spencer (M&S) launched lunchtogo – an online corporate catering service enabling companies to order M&S food for workplace meetings and events. The service allows companies in major conurbations to order as late as 4pm for delivery the next working day. M&S turned to long time partner EWA to manage the lunchtogo order and enquiry contact centre.
Challenge
The initial challenge was to centralise the sales, ordering and customer service processes, bringing stability and consistency to an embryonic initiative. This was followed by the need to build long-term relationships with customers who often changed personnel, policies and responsibilities.
EWA Approach
To overcome the initial challenge EWA developed a fully integrated database system encompassing customer prospecting, registration, order-processing and finance controls. This ‘end-to-end’ approach provided M&S with a full picture, from prospect conversion to fully fledged customer.
This was followed with the creation of a dedicated customer service helpdesk comprising a mix of skills from marketing and post-sales support to finance administration. Cultural and product training was in-depth and continuous.
Finally, the all important processes and connectivity to other service providers, (e.g. food picking units and logistics suppliers), were put into place – EWA playing a leading role in systems, training and client staff motivation. These measures ensured the lunchtogo process was a tightly controlled, fully automated, web-based operation.
The approach to building long-term relationships was to derive a model for communications based around an individual’s order value and frequency; this led to the development of the targeted communication programme - Critical Lag.
Development of the Critical Lag programme was based on analysing ordering behaviour, looking at the frequency and time lapse or ‘lag’ between each lunchtogo customer’s purchases. It became apparent that each customer had their own unique pattern of ordering: some defined whilst others were extremely sporadic.
Through sound statistical reasoning, the Customer Insight team developed the Critical Lag formula. This identified lunchtogo customers whose lag since they placed their last order, fell outside of their statistically expected behaviour and, therefore, heightened their risk of lapsing. EWA worked with M&S to understand their business rules which added another layer to the programme.
The system was designed to send communications to those customers whose order lag exceeded the maximum allowed by the calculation. The top five per cent of customers received a phone call because of their value and importance with the remaining ninety-five per cent receiving an automatically generated email ensuring that a direct communication channel was maintained.
The Critical Lag programme was fully integrated into the lunchtogo database by EWA. The programme was configured to run every night and take into account any new orders received daily, adjusting the Critical Lag values accordingly.
Since the timing and content of communication was unique to each and every customer, a big step in reaching the marketer’s utopia of true one-to-one marketing was achieved.
Result
The programmes implemented by EWA had a significant impact on customer retention, reduced churn rates, maximised sales opportunities and generated upwards of £1million of additional orders, more than trebling the operation’s revenue.
The lunchtogo programme managed by EWA was a tightly controlled operation that pioneered workplace shopping for M&S. Analysis and data mining helped to formulate successful strategies for commercial viability, marketing, customer retention and debt control. Through this, the incontrovertible key to success and profitability in a low margin business was a virtually error free service. EWA delivered a 99.97% order accuracy rate and is proud of its contribution to a successful operation.
Testimonial
“Running lunchtogo through EWA ensured that we continually improved the relationship with our customers. Their corporate expertise was vital in the development of the business, and over the duration of the programme they continued to bring new systems and ideas that ensured we remained ahead of our competitors”.
Bill Davies, M&S Senior Buyer
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