Customer Profiling through Data
Analysis at Online Lubricants Ltd
Vijay Mahatma
MSci Astrophysics (4th Year)
Royal Holloway, University of London
Online Lubricants Ltd
Online Lubricants are a B2B supplier of oils and lubricants in the UK. By delivering “outstanding customer service”, they have achieved a
£5m annual turnover, and are planning to double in size over the next 5 years. The aim of this internship was to bring statistical data
analysis methods to the company to create a customer profiling system, that acts as a strategic tool in assisting the company to identify its
growth opportunities. This aim has been achieved and the new system is now fully integrated into the company’s sales information system.
Customer Profiling System
The system produces a number of graphical and data reports based on the
company’s running data. This includes time series and moving average
graphs of sales, profits, order gaps, and average days to pay for each
customer. There is also a normal distribution plotted for each customers
sales growth using a rolling 12 month period.
Planned Future Developments
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A further parameter will be introduced to refine the results; a Nice To Do
Business With Factor (NTDBW). This parameter measures the response of
the sales team to each customer on a transactional basis and provides
further data to be incorporated into the stratifications.
The customer profiling system will be replicated using the company’s
product portfolio to achieve a similar output-a product profiling system.
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This system stratifies all customers into GOLD, SILVER, and BRONZE bands.
The stratification is based on 4 key business parameters: Sales Volume, Gross
Profits-both actual and as a %, and Average Days to Pay.
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A points system scores all customers according to their relative position. All
customers are ranked according to the 4 parameters. The top 30% from each
ranking column are given 3 points, the next 50% are given 2 points, and the
bottom 20% are given 1 point. The total score for each customer was then
stratified into GOLD, SILVER, or BRONZE. This enables the company’s sales
team to boost profitability by focusing more effort on GOLD customers, and
boosting sales of BRONZE customers brings them up to SILVER and GOLD.
The user is able to select each customer and choose from a number of options
for individual customer analysis.
Other work at Online Lubricants
• Assisted in the work of company branding with another intern, to ensure that a
consistent brand for the company was developed and marketed.
• Assisted another intern in developing a system to automatically update the
minimum selling price of products using statistical techniques. Price-quartiles
of products’ invoice history were used to improve the reliability of the current
measure for the minimum selling price.
For more information, please contact: Online Lubricants, Unit 20, The io Centre, 69 River Road, Barking, IG110DR. Telephone:02085070123