Marketing Case Studies

Take a look at a cross-section of firms, marketing problems, and results of work to understand the impact research-driven marketing consulting can have on your business.

In the mid-1990s, Mobil, now ExxonMobil, was at a crossroads with its service station business. New low-price brands began showing up everywhere, and the major brands started to work hard to differentiate themselves, with an aim toward gaining more margin from the business. Mobil commissioned Copernicus to better understand its customers and prospects. The results of Copernicus’ work formed the basis of what continues to be one of the most exciting strategies ever launched—the Mobil Friendly Serve Campaign.

Copernicus found five distinct consumer groups, all roughly the same size numerically, but with vastly different shares of potential profitability. Representing 38 percent of the population and 77 percent of potential profitability, Car Buffs and Loyalists were clearly the financially optimal target groups. Once Mobil knew the target, it knew whom to talk to and where to find them, how to communicate with them, in which media, about which products, at what price. Sales and profitability dramatically increased—and continue to—in service stations that implemented Friendly Serve.

Saks Fifth Avenue

In deadlock competition with Bloomingdales, Neiman Marcus, and Nordstrom, upscale retailer Saks Fifth Avenue wanted to find a way to get ahead and stay ahead of the pack. For years, the company had invested a substantial portion of its marketing money on programs aimed at what it consider to be its very best customers, yet it had not seen dramatic increases in its share of wallet. It also needed a way to integrate the information it had about customers with a block-level census to produce more efficient direct marketing programs and guide store merchandising decisions.

Working with Copernicus, Saks soon discovered that the “best customers” it had focused on were also the best customers of all of its competitors. They were simply fashion-forward, high-powered, wealthy women who spent quite a bit of money on clothing and fashion and, with no particular affinity of one or another, spread it around to different stores.

Copernicus helped Saks identify clear segments among its base of customers, bearing in mind that the end result had to tie into internal and external databases for direct marketing and merchandising purposes. With a better picture of its most profitable customers AND what their needs/wants/desires/motivations were, Saks beefed up its brand strategy and merchandising efforts. The fuller picture of the needs of each segment also helped sharpen the retailer’s product strategy and led to one of the most successful new retail concepts in recent years, Saks Off Fifth.

Seven years ago, Green Mountain Energy, a small electric power company in Burlington, VT, came to Copernicus with an interesting question: would Copernicus be willing to work with Green Mountain to create a new brand of kilowatt hours in an increasingly deregulated environment. Copernicus was and the rest is history.

Conventional wisdom held that electric power was a commodity, where price was the only attribute of importance. Copernicus found, however, that a significant portion of target buyers were concerned about pollution and environmental damage cause by coal-fired electric plants. Further investigation revealed that these same consumers would be willing to pay more for “clean, green” electric power. Green Mountain generated power from solar, wind, and hydro-electric sources and this lead to the development of a positioning, “clean, green power made from the raging rivers of North America, the prevailing winds, and the sun. No coal, no nukes, no kidding.”

The resulting marketing campaign received the International Energy Industry’s award for “Best Marketer of the Year” and Green Mountain quickly became the #1 brand of deregulated energy in the nation. The company was deluged with requests from businesses including Toyota, GM, Kinko’s and the GAP, and BP was so impressed, it bought a major stake in the company.

With an eye towards national expansion, Dunkin Donuts, the largest coffee and baked goods chain in the world, began to wonder whether its existing store concept would work across the U.S. or if it should make changes. The company had no shortage of ideas about what the company could do: serve sandwiches, offer catering and delivery, provide cozier seating, have a more sophisticated look, etc. It had little information about what customers want/need or what would make Dunkin’ the most profitable.

The company turned to Copernicus for help developing the “Dunkin Donuts of the future.” Copernicus used concept engineering to test more than two billion different configurations of product, service, and price and identified the impact of each item on visits, spending, and sales for different segments of customers. All the possible restaurant and menu combinations were reassembled to forecast visits and sales. The costs associated with different items were subtracted from estimated sales to provide a profitability assessment.

Dunkin took the most profitable store concepts and built prototype stores which quickly exceeded objectives for customer satisfaction and sales, and were described in recent Boston Globe, "Dunkin Plots National Push," and Time Magazine, "Brand New Buzz," articles.

Brazil is the third largest beer market in the world with more than 30 different brands competing for share. Skol was the #4 player in a market dominated by two other major brands and was barely eeking out a profit. Brahma, the brand’s owners now part of Inbev, called in to Copernicus to see if the brand could be saved.

Copernicus discovered Skol, like most other brands in the market, had no specific consumer target or clear, differentiating positioning. Brahma had only a small marketing budget to put behind the brand, so needed to identify the most impactful media plan and advertising strategy to break through the clutter. On the B2B side, Skol was weak in on-premise channels such as bars and restaurants and needed a sales strategy that would bring distribution to a level competitive with the other leading brands. All of these things made for one big, hairy marketing problem for Skol and were really impeding the brand from realizing its full potential.

On the consumer side, Copernicus identified the most profitable people and occasion segments, a compelling positioning based on “smooth flavor,” media plan, and advertising campaign. With B2B, a marketing mix model helped the sales force better understand key distribution channels and redirect efforts. The results were transformational—Skol skyrocketed from the #4 position to the #1 position in its home market and doubled its market share. Today, the brand is the #3 beer brand in the world—without a drop sold in North America—and its brand manager has become CEO of Inbev, the world’s largest brewer and new owner of Anheuser-Busch.

constellation

Constellation Wines U.S., part of the largest wine business in the world, wanted to capitalize on rapidly increasing consumer interest in wine and purchases of it, and grow its market share. The firm asked Copernicus to figure what it could offer its B2B customers that would help move its products and secure additional shelf space.

Copernicus launched one of the largest consumer research studies in the wine industry. The firm focused on premium wine consumers. The resulting analysis produced richly descriptive profiles of six market segments which Constellation in turn appended with zip code information. For any retail or restaurant location, Constellation was able to offer a customized profile of the relative mix of customer types that frequent it.

Copernicus’ work classified all premium brands—not just its own, but also its competitors'—by segment, so it could evaluate an account's product assortment. The segment profiles included preferences for the promotions, displays, and featured products, enabling Constellation to determine whether a retailer adequately addressed the needs of customers in a particular trading area. As the division’s president and CEO José Fernandez explained at a press conference, "everybody wins with this sort of research. Our retail and on-premise partners will now have even better insights into their customers and that can only lead to increased sales and more satisfied consumers."

lafarge

Top management at Lafarge, one of the largest diversified suppliers of construction materials in North America, charged marketers at the company with the mission of branding cement. They brought in Copernicus to segment LaFarge’s B2B base of customers with the caveat that the sales force had to be able to quickly identify which package of products and services to offer in the field. Copernicus worked with both the marketing and sales department to understand who would use the segmentation and who they would use it to make decisions that would increase the likelihood and profitability of a sale.

Guided by the results of the segmentation, LaFarge assembled packages of what it called, “currencies”—essentially product and service attributes and benefits—to ensure the sales script hit all the right notes based with a customer or prospect. As a last step, sales and marketing worked together to devise a computerized tool the sales reps could use after consulting with a customer to quickly devise a tailored offer in the field.

Jim Braselton, SVP of sales and marketing, and Bruce Blair, VP of product performance, at Lafarge reported, “selling efficiency improved markedly as salespeople began to spend more time with customers on the right topics and less time on non-relevant currencies.” When the company rolled out a pilot program to test the new marketing-enhance sales approach, pricing improved by 5 percent, operating margins increased 20 percent, and customer costs decreased by 10 percent. Customer response to the new sales approach has been widely positive, and the efficiency of marketing programs improved.

ethicon

A Division of pharmaceutical giant, Johnson & Johnson, Ethicon Endo-Surgery wanted to understand how to most efficiently prioritize marketing activities and set budgets against three different stakeholder groups—biopsy physicians, referring physicians, and breast biopsy patients (women age 40+)—for its breast biopsy product, Mammotome.

Copernicus discovered that Ethicon would dramatically improve marketing ROI if it abandoned direct-to-consumer efforts and redirected them to education programs for referring physicians, a key influencer of the type of breast biopsy that their patients receive. Copernicus also took a closer look at biopsy physicians, segmenting this professional market. The work led to the development of a computer program allowing sales reps to identify physicians by potential volume so they knew which customers to cultivate and which to ignore.

With the new strategy in place, the breast care division of Ethicon grew by 75% in two years and Johnson & Johnson awarded it the company’s prestigious Bellringer Award for Outstanding Marketing for its contribution to the bottom line.

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