Key Customers

Focusing the Sales & Marketing on Key Customers


Our client is a market leader in the UK life & pensions industry. They operate one of the largest pension funds in the UK and sell their products via various channels to market – namely IFA’s, tied agents (Banks and BS) and JV’s. The business is profitable with an enviable track record and strong branding.

However, impending government legislation (Sandler) would mean that the costs of sales and marketing and overheads, previously handled as sales commissions, would be made explicit to would be product purchasers’. Customers would be able to evaluate the product in terms of how much was spent on commissions and how much was being invested in the pension or life product. The industry leaders, quite rightly believed this would lead to increased competition and a squeeze on costs.

Consulting Assignment

The client asked us to look at the sales and marketing division to see how they could improve their effectiveness and reduce the costs of doing business.

Key Project Activities

The programme comprised of the following activities:-


  • Key stakeholder interviews – to understand the industry issues, competitive forces, trends and business strategy
  • Customer research – to understand service levels by channel and customer concerns
  • Staff research – to understand organizational barriers and capability
  • Financial analysis – to understand value creation and profitability by customer group


NB. In segment 1 (large Banks and BS) 6 distributors accounted for 37% of ROCE (return on capital employed) and required 30% of distribution costs. Whereas in segment 2 (smaller Banks and BS) 40 distributors accounted for 32% of ROCE and required 39% of distribution costs. The challenge was to balance the business support in relation to the value created.


Our recommendation was to re-organise the Sales & Marketing services, support and structure in proportion to the value derived from each customer group (the existing processes and structure bore little relation to customer value, but rather to historical precendent).

The key points were:-

  • Segment distribution to match the market segment
  • Tier the service offering to match the contribution to profits
  • Segment the service offering to match the importance of the relationship


We set up a series of customer change teams to:-

  • Develop service levels and accompanying operational processes by customer group
  • Design a supporting structure for the operational processes. Specify the capability needs for each team. Manage the recruitment of managers and staff into the newly designed teams.
  • Develop and deliver the internal communications to the business
  • Develop and deliver the external communications to customers and stakeholders

Client Benefits

The key customer change programme has the following benefits:

  1. Sales and marketing processes re-aligned to match the value derived from each customer grouping
  2. Organisation re-designed round the key customers
  3. Headcount reduced from 1350 to 870
  4. Regional offices reduced from 40 to 19
  5. Overall budget reduced by 25%
  6. Move from a sales focused culture to a profit focused culture