Concept of customer profiling/segmentation and its application for marketing decision making.
Learning the concept of recency, frequency and monetary (RFM) and applying RFM analysis for customer segmentation.
Understanding the concept of target marketing and its importance in customer retention.
Curation of marketing activities for identified customer segments.
Vrundavan Sales Corporation (VSC), Rajkot, a trading business dealing in agricultural machinery, was established in Rajkot, Gujarat, in 2015. The company was founded by Dayanandbhai Vyas (Chairman) along with his son, Mr Adinath Vyas (Managing Director), who had developed their client base across Gujarat and parts of Rajasthan and Maharashtra. However, recently the company had started encountering issues with client dropout in a few regions, making the duo concerned about their future revenues. An immediate meeting with salesmen at Rajkot HQ aided in getting some startling revelations, prompting the two of them to think about designing customer segmentation/profile-based retention strategies. They decided to use RFM analysis to segment their current customer base, as using such a data-driven method could make their targeted marketing efforts more valued by customers, thereby strengthening companies’ retention efforts. This case invites students to step into the shoes of Mr Adinath Vyas, who was required to guide the recently recruited intern, Ms Ananya Pandey, through the RFM analysis for which this case provides the data set of 274 customers for the financial year 2023–2024. The objective was to use the data set to profile the customer into different segments such that, based on their buying patterns, new retention strategies could be designed at VSC.
This case is suitable for students of management at graduate and post-graduate levels of students.
Teaching notes are available for educators only.
CSS 8: Marketing.
