Success in direct sales is dependent on controlling complex processes. At Fuzzy Logix, we provide solutions that help you manage the complexity in an easy and straightforward way. Looking at the sales process from end-to-end, there are many ways we can help, including:
Generating Demand
Optimizing your marketing spending and aligning the results to your operational capabilities can be challenging. Our models help you predict the response of individual campaigns and also to decide how to allocate funds over multiple marketing programs to achieve the best return on your marketing spend.
In addition, our forecast are usually more than 95% accurate for more than 10 weeks into the future so you can match your sales force capacity, production and inventory to the demand generated.
We can also help you avoid the common problem of not knowing when a program is coming to the end of its effective life until the after it has already happened. With our solutions, you will know the exact lifecycle of your offers. Therefore, you can make decisions to avoid the peaks and valleys of the normal sales cycle and smooth sales and cash flow.
Our behavioral segmentation programs use pattern recognition to cluster segments based on the behavior of your buyers. Whereas traditional methods force customers into pre-defined boxes, our techniques produce results that reveal the true groups and their behavior so you can match the best offer to the right customer at the right time.
Converting Demand to Sales
Once demand is generated; you have to convert the opportunity into a sale. Our solutions will help you match the opportunity to the best salesperson and measure, manage and improve closing rates.
We also provide tools to analyze historical and predictive results from an infinite number of perspectives including geography, product, sales person, time of day and other ways that you desire.
Closing the Sale
Closing the sale doesn't always mean recognizing the revenue. To help you manage issues that arise when turning sales into recognized revenue our solutions improve pull through and retention.
If you extend credit, we have credit quality programs of the caliber previously available only to investment banks fielding multi-million dollar teams. We provide the same level of credit analytics for a fraction of the cost.
Improving Reorders and Deepening Relationships
During the sales process and especially post sale there are usually unrecognized opportunities to deepen relationships. Our programs can help you identify your customers buying cycle and understand their next likely purchase of different products or services.
Behind the scenes of our easy to use applications, we use pattern recognition algorithms to uncover clues in your customer's behavior that can't be identified using traditional methods. Finding these patterns are the key to understanding your customer's future behavior and helping you target your products, services and sales efforts to achieve optimal results.
In times of rising cost and consumer unrest, getting the factors that drive success in the retail and grocery industries means the difference between successfully managing short term profit and long term viability versus other less desirable outcomes. Our solutions help you thrive in uncertain times.
Know your customer
Retail and grocery marketing and loyalty programs are sometimes too generic to be effective. For example, one of our founders consistently receives coupons for perfume from a major retail company. Realizing that this offer is paid by the perfume company doesn't alter the fact that his family has never purchased perfume. Another member of our team buys gluten free items because his son can't tolerate gluten, but each month he receives offers that are for products containing gluten. Instead wasting the number of reasonable contacts customers will allow on marketing that doesn't drive sales, wouldn't it be more effective to target his family for items they do purchase and bring those purchase decisions forward?
Our solutions help you touch specific customers with highly targeted messages based on their segmented and predicted behavior. The result is that you make the best offer to your customer at the right time to drive desired behavior. For example, for one client, we determined that two vastly different demographic groups had the same behavior. Our client to changed their marketing approach and realized significantly higher revenue from their campaigns.
Maintain your Margins and Move Inventory without Deep Discounts
Would you sell an item that normally retails for $100 to a customer for $75 if you could have sold it to them for $90? That's exactly what happens when companies go to market with blanket discounts.
Our solutions help you identify the discount threshold for individual buyers and segments. Using the insights gained from our analysis, you can target customers who will purchase items at smaller discounts than others and maintain your margins. For example, if you have 20 winter sweaters on your shelves at the beginning of spring, we can tell you exactly who will purchase those with 10% discount. If the number of customers in that category is high enough to move your entire inventory, then you will see dramatic savings over the deep discount methods usually applied.
We can also help you get the optimal price for your products by calculating the price elasticity of demand and the effects of price changes on co-movement and cannibalization. For grocery stores, who can have 50,000 or more SKUs, our solutions consider all possible options before determining the exact price to maximize your margins and co-movement and minimize cannibalization.
Success in the Automotive Industry depends on managing many interrelated factors. Our solutions help you make decisions about managing customer preferences, inventory and retention by identifying patterns of behavior that cannot be derived using traditional methods. Our solutions help with:
Automobile and Parts Inventory Control
Having the ideal mix of auto inventory in stock is one of the more difficult and time consuming tasks faced by dealership personnel. Our programs allow you to accurately choose your inventory based on your market and customer's purchasing patterns. We are able to analyze hundreds of thousands of option and color choices and recommend the optimal mix of model types for maximum sales and in a way that is truly free of all personal bias.
Your ideal inventory mix is easily available on each decision makers desktop through web based applications. The generated results are easily integrated in to most dealer management systems (DMS) or manufacturer's systems.
Inventory recommendations are based on the most likely to sell vehicle. Faster sales will lower the average days in stock and increase turn rate with manufacturer.
Our forecast are usually more than 95% accurate for more than 10 weeks into the future so you can match your sales force capacity and inventory to the demand.
To minimize cash tied up in parts inventory, our programs can help you predict inventory requirements months in advance therefore allowing you to keep the minimum inventory on hand, while never running out of the parts you need to service your customer's needs.
Customer Retention
Managing your existing customer base is best way to insulate your business from market fluctuations. Our modeling allows you to monitor and predict your customer's behavior through advanced pattern recognition. For example, we analyze lease and finance data to identify when the ideal trade point occurs.
A web based application that monitors your customer's payoff, predictive mileage (based on service ROs) and trends in wholesale value, allow us to put a list of customers who can trade on your desktop. This gives you the capability to effectively manage your lease and purchase portfolios.
Because you know the behavior of your customer in advance, you can communicate with the customer prior to the ideal trade point. Through targeted micro marketing your company can ensure higher retention rates by allowing you to make the best offer to the customer at the best time.
Parts and Service Marketing
By using our behavioral segmentation algorithms, highly similar customers are identified. The algorithms use advanced pattern recognition to analyze the data and identify hidden and valuable knowledge. Once the segments and members are identified, you can target different groups with specialized offers that are most effective to that group.
Using our marketing randomization techniques we can easily measure and determine the best offer for each segment. The effectiveness of this approach can be clearly seen and historically improves return on marketing spend 15% or more.
In an increasingly competitive marketplace, success in Manufacturing and Distribution requires an approach that both increases revenues and manages costs. Fuzzy Logix can help you make those important decisions with a higher degree of confidence.
Production Forecasting
Behind the scenes of our easy to use applications, we use pattern recognition algorithms to uncover clues in your product's behavior that can't be identified using traditional methods. Finding those patterns are the key to understanding your customer's future behavior and helping you target your production schedule and achieve optimal results.
Using advanced quantitative techniques, we can forward predict demand for your products down to an individual item or SKU. We also can predict co-movement and cannibalization.
Our forecasts are typically more than 95% accurate for more than 10 weeks into the future so you can match your sales force capacity, production and inventory to the demand generated.
Inventory Optimization
Our forecasting models allow you to see well in advance what you will need in stock to meet your future needs. Analyzing your inventory movement, our programs permit you to put aside all analyst bias and truly give you actionable information. Our process improves your performance on both the fulfillment and supplier sides of your business.
Through these efforts your company can create a lean inventory system, carrying as little stock as possible while always meeting your end users order requirements. This will help you reduce the expenses associated with having large amounts of stock and the reactive behavior that backorders create.
Cash Flow Forecasting
Traditional cash flow forecasting is usually a combination of basic analysis with estimates of new initiatives added in for good measure. In fact, 75% of US businesses use spreadsheets to model cash flow with varying degrees of success. Our cash flow models use prediction and pattern recognition to produce highly accurate forecast of cash.
In many instances, our model has identified and predicted variances in cash flow that were caused by major operational issues heretofore unknown by our clients.
Improve Reorders and Deepen Relationships
Nothing creates great relationships like exceeding your customer's expectations. Fuzzy Logix can make you a highly effective supplier of choice, by allowing you to foresee your client's expected purchase patterns and make actionable recommendations that help your clients meet their customer commitments.
By analyzing product co-movement and forecasting changes in buying patterns, we can help you predict your clients and your client's customers next likely purchase.
Using these techniques all areas of your company reap the benefits, from your frontline salespeople, supply chain personnel, to the warehouse staff.
Membership organizations and charities have the same challenge – how to focus on the vital few members that are either about to leave or stop giving and also those that are candidates to move up their participation and donation. Our solutions help you identify and then target both groups.
Identify and Help People either at-Risk or for Higher Participation
How do you decide which members or donors to focus on with limited resources? We deliver an easy to use interface backed by sophisticated pattern recognition to segment your participants and tell you exactly who is likely to cancel their membership or discontinue their donations and also who is a candidate to increase their participation.
For health and athletic clubs, we can tell you who you who has the highest propensity to leave and also show you why. This will allow you to target those customers for retention by solving the issues driving them away. In one case, retaining just 5% of the leavers will result in the organization realizing over $1 million a year in benefits.
For charities, we can help you identify the givers who are most likely to decrease their giving or stop altogether. Our models can also be used to tell you the donors who are most likely to increase their giving.
New Member and Donor Acquisition
In addition to helping athletic clubs keep their current members, our programs help identify future members by using behavioral segmentation to determine the best target group for the facility. We then help develop targeted campaigns and track the results.
Our donor behavior analysis will help you understand the motivation of the donors and identify new donors who share that motivation. Once we have identified and segmented the future donors, we use randomized marketing test to match the best marketing approach to each segment and launch the full campaign.
Coming Soon!
Financial Services
These days operating financial services firms can be complex and therefore it is important to have the right tools for decision making and management. At Fuzzy Logix, our team has over 20 years combined experience in investment, commercial and consumer banking. Our experience is deep in areas such as:
- Building an origination strategy for mortgage lending that led to 100% growth in 4 years to $22B.
- Developing the strategy for portfolio optimization and rebalancing to manage one of the world’s largest portfolios of commercial loans.
- Implementing a process and the corresponding models to value thousands of companies daily to assess lending risk. These tools included the valuation of cash flow, receivables, inventory, forward contracts and organic growth.
- Building the technology platforms for modeling massive quantities of data using complex quantitative methods to simulate the behavior of financial instruments.
Risk Management
Lenders are exposed to market, credit and interest rate risk when lending money to clients. A balanced approach to managing all three is required for ensuring that the risk and reward associated with the loans is optimized.
- Origination risk occurs when lending decisions are made without accurate models of future performance. Our tools allow you to model the future performance of assets based on a defined set of origination parameters. In addition to forecasting the performance of future customer relationships, we also help you understand the performance based on various economic scenarios so you can make better origination decisions.
- For market risk, we use sophisticated modern financial methods to measure exposure and model solutions to hedge your risk using derivatives and other structures.
- Interest rate risk can be hard to manage because forecasting interest rates and the associated yield curves is difficult. Our programs can accurately forecast these values many months into the future with more than 95% accuracy.
- To manage credit risk you need to understand the behavior of the borrower throughout the time of exposure. Traditional methods only allow you to be reactive once the change in credit quality occurs. We deliver solutions that let you quickly assess the future health of borrowers so you can proactively manage your portfolio. Our solutions have the capacity to assess the health of thousands of companies on a daily basis.
When valuing a company there are many things to consider including:
- Cash flow – Traditional cash flow methods are unable to identify hidden patterns in data that can dramatically alter projections. In addition, these methods are subject to error since it’s usually impossible for companies to accurately identify all of the drivers of change in cash flow. The classic example is assessing the impact of a change in tactics made without a measurement system or accurate forecast available to assess the value of the change. Our solutions use modern regression techniques and sensitivity analysis to provide a more accurate picture of future cash flows. The solutions can be at-will instead of being dependent on the normal planning cycle of the organization.
- Receivables – Usually companies value receivables using only past performance in a single dimension. We leverage the concepts of cohort (group) and tenor (the period when payment flow is available) as a starting point and then leverage behavioral segmentation to create the correct number of clusters needed for analysis. Finally, we apply our forecasting models to deliver highly accurate valuations.
- Inventory – We value inventory using multi-dimensional analysis of valuation and movement. We also include an assessment of the value of contractual obligations that may be expiring. By assessing inventory this way, we obtain a more complete picture of future value than methods that strive to value only the existing inventory based on past performance.
- Forward contracts – The value of forward contracts is generally assessed for only the length of the legal obligation. What happens if the valuation period is longer than the forward contract? We are able to forecast the propensity of the contract being renewed and also the pricing and term changes that may occur.
- Organic growth – If you’ve ever been through the annual forecasting “process,” you’ve used some sort of thorough and painful methodology to arrive at a best guess. In reality, that best guess is usually only accurate for a short period of time. The use of regression techniques and simulation allows us to discover subtle changes within your organization and provide very accurate long-term forecast. In addition, the solutions can be run at-will because they are data driven and not limited by an annual corporate process.
Portfolio Optimization
Based on Modern Portfolio Theory, our portfolio optimization solutions can help you manage and maximize the risk and return characteristics of your entire portfolio. Financial services companies use these techniques to mange investment portfolios and we have successfully applied this methodology in other areas such as marketing, key word buying and loan exposure management.
Specifically for financial services, we can value commercial and consumer loans, investment banking relationships, real estate holdings and other significant assets that produce a return on investment. First we model the individual asset to establish the risk/return continuum and then we combine the models to develop a solution for the entire enterprise. By taking a portfolio view, rather than a siloed approach of managing a single asset you balance your strategic portfolio while your peers race to grow individual assets without understanding the overall effect of an unbalanced revenue stream. The results, leveraged strategically, can yield a high performing financial institution with smoothed earnings.
Customer Retention, Relationship Deepening and Acquisition
Using our effective behavioral segmentation, pattern recognition and forecasting algorithms, which are designed to dramatically improve client management, can have a high impact on your revenue growth.
Many companies spend a lot of effort to gain customers, but not enough to retain them. This creates an expensive cycle of processing customers in and out the door and then finding replacement customers. Our programs can help you identify customers with the highest propensity to leave and help you uncover the drivers of their behavior. The result is higher customer retention and the ability to identify and address issues that would have caused other customers to leave in the future.
In addition to retaining customers, wouldn’t it be great if you could anticipate their financial needs and present the best solution to them as the need arises? Our programs allow you to determine a customer’s next likely need and present a solution that customers will appreciate and adopt. Not only will you benefit financially, research has shown that these customers will maintain their relationship with your organization longer if they believe that you know and anticipate their needs.
Acquiring new customers can be challenging in a highly competitive marketplace. Our solutions can help you identify prospects and target them with the best offer at the right time. Unlike traditional financial services marketing, we use a number of quantitative techniques to target customer groups with accuracy otherwise unachievable without the application of these methods. Although the theory is complex, business users are presented with a simple, easy to use interface that allows them to interpret and act on the results without the need to obtain their PhD in math, but rather by using their existing experience and skills to act on the results of our findings.
Please contact us to discuss how our solutions improve business performance.
