Posts Tagged ‘Marketing Analytics

17
Aug
08

Customer-centric lead scoring

We have always seen that companies struggle to manage the leads that they generate. Either they are not followed-up effectively or there is a conflict of what is defined as a hot/warm lead by sales and marketing or there is no defined process of managing unconverted leads to extract more value out of the marketing investments made.

Tim Wilson has an interesting prespective on the same:

Old school lead-generating efforts often fail because Marketing and Sales initiatives are dependent on each other but disconnected. The image often associated with this relationship is a funnel. At the top of the funnel is Marketing, which finds and lures leads that are then pushed down to the lower portion of the funnel, which is Sales.

This funnel image is fundamentally flawed because it suggests a linear process. Rather, to succeed, the process must be ongoing and circular, like cogs that continue to rotate and engage each other. One cog is Marketing (tactics), and this must be in alignment with a Sales cog (engagement), both of which are driven by a third cog: the continuous process of lead marketing optimization.

Complaints from the Sales department often occur because Marketing prematurely hands over leads to Sales, which creates efficiency problems. First, some of the information that needs to be gathered could have been gathered automatically through a Marketing dialogue. Second, the lack of that information results in lead handoffs that have little or no near-term potential. Over time, these inefficiencies cause Sales representatives to lose trust in the value the Marketing department is providing. In the worst case, it results in the salesperson starting to cold call himself, which makes the level of inefficiency even greater. According to Anders Grondstedt:

“Non customer centric thinking organizations are organized to efficiently produce and distribute goods. They relegate customer management and brand building to marketing and communication departments and agencies that sequester themselves in separate offices, isolated both from each other and from the customer, churning out advertising and other communications material to an information overloaded world. They make a virtue of outspending and outshouting the competition. Run more ads. Maximize the numbers of impressions. Get more ‘ink.’ They are frittering away millions of dollars in “marketing.”

 

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10
Aug
08

How Harrah’s Entertainment translates customer data points into the big picture.

At Cequity, we have always believed that “earning points” in a loyalty program is a means to an end and not the end itself. Many companies fail to see the data from such programs holistically and tend to treat it too tactically leading to managing the points rather than an effective customer management strategy intent with which they started these programs. One of the few companies that have made this transition happen is Harrah’s Entertainment. Here’s what David Norton, CMO of Harrah’s Entertainment had to say:

Pointillism is a painting style in which the artist dabs small dots of primary colors on the canvas. Viewing the artwork at nose-distance, you see nothing but adjacent points. But step back, and suddenly you see Georges-Pierre Seurat’s A Sunday Afternoon on the Island of La Grande Jatte.

Analysis of customer behavioral and transactional data can similarly suffer from such granular myopia. Individual data points viewed without an overall perspective not only masks the larger view, it also blinds you to opportunity.

When I joined the company in 1998, we designated customers who played $400 in a given visit to one of our casinos as VIPs who received preferential treatment. But a customer who played $402 during one visit, triggering VIP treatment, might play only $398 on a subsequent visit and receive no such treatment. More importantly, customers who played only $50 a day but visited 50 times a year received no differentiated service at all.

As our goal is to see the total picture of a customer’s play with Harrah’s casinos, members earn credits across any one of our 12 casino brands. This feature not only benefits our members; it also allows us to measure their cross-market play. A third of our revenue comes from members playing in a property other than their home property—whether home is Las Vegas, Atlantic City, Reno, New Orleans or Tunica.

Our Total Rewards database also gives us unique insight into our customers’ total relationship with Harrah’s—including their non-gaming spend. Historically, Harrah’s Entertainment earned 80 percent of its revenue from gaming; our initial data analysis revealed that we received less than a third of our customers’ non-gaming budget. Once we acquired the Caesars Entertainment family of properties, however, non-gaming revenue—from hotel stays to fine dining to entertainment to shopping—became a significant portion of our business. Caesars Palace provides a strong gaming revenue stream from a relatively small number of VIP players, but many Caesars customers come to Vegas for non-gaming entertainment. We can now encourage non-gamers to use their Total Rewards card, for stays at Caesars Palace, trips to the spa and on our shows and still receive all the benefits of our loyalty program. Today, $2.1 billion of our revenue comes from non-gaming activity—and we want the total picture of those customer relationships too so we can customize their marketing and service interactions.

09
Aug
08

Building brand agility thro’ customer insights and integrated marketing techniques

A slow economy does not always mean death-knell for brand marketers. The ones who mine customer data, identify purchase patterns and discover useful insights will be the ones who will win in this environment. At Cequity, we continue to advice companies to walk this path with 3 specific strategies:

  1. Accelerate your customer database management strategy
  2. Embed analytical thinking within marketing teams where use of data & analysis is made mandatory
  3. Micro-market – Identify smaller & smaller segments and increase campaign velocity with relevant offers

Here’s what the article has to say:

According to Experian, companies that can gain useful customer insights through integrated marketing techniques will benefit from greater agility than their competitors and will be able to more quickly adapt to market changes and provide products, services, and value propositions that are more closely tuned to customer needs and purchasing patterns.

Collect insights, not just data
According to Marie Myles, director of marketing consulting at Experian’s Integrated Marketing division, “Based on our experience with some of the world’s largest consumer brands, the turbulent economy simply means a re-doubling of efforts to derive even more valuable intelligence from every consumer interaction.”

Actions for brand growth

  1. Understand customers and their needs
    Customer insight needs to be continually revisited to ensure that it is up to date, focusing research investment on this area and not solely on the brand. Marketers need to use this intelligence to create engaging and relevant messages based on a solid understanding of each customer’s preferences, needs and behaviours. This will pave the way for true one-to-one communication and enhanced brand loyalty.
  2. Analyse and segment
    Customer profiling, clusters or RFV models are essential to identify which customers are spending the most, how to uplift sales and to detect high value customers that show signs of diminishing value. As new trends emerge, marketers can use this insight to adapt and refine retention marketing techniques on a personalised basis.
  3. Adapt products and services
    It is imperative to assess the environment and for marketers to re-evaluate their propositions. In a changing economic climate brands need to be responsive to evolving buying habits. By taking this approach, marketers will be able to offer a better service to customers, making it harder for competitors to lure them away.
  4. Integrate channels to increase customer engagement
    Customers expect to be contacted through different media. Companies need to understand these media links and weave different online and offline messages to build compelling, engaging and personal experiences. Integrating channels at different stages of the customer buying cycle and customer management programme will drive benefits including a more consistent and persistent message.
03
Aug
08

Sales & marketing silo syndrome: a real problem

The CMO council recently released the findings of the Sales & Marketing Silo syndrome in organizations. Since data between sales & marketing need to be fused for better returns on marketing investments. At Cequity, we too see this gap existing in companies as a part of our client assignments. Enterprises need to effectively harness this data for better ROI. Many companies have recently started to take steps in breaking this silo and ensuring there is better synergies between these two departments. Here are the survey findings:

  • Less than 20% of respondents said that their sales and marketing organisations were “extremely collaborative”, and most others felt that the two groups had “intermittent relations and interactions”.
  • Looking at the ways in which sales could add value to marketing messages and communications, survey participants felt that engaging strategically with customers to better understand their problems and needs was the most valuable contribution.
  • Two of the most important roles that marketing can play in optimising sales performance were cited as “fielding campaigns that generate and nurture leads and opportunities”, and “providing customised value-selling content and presentation materials”.
  • Only 12% of sales and marketing professionals said that they have a well-integrated, real-time view of all customer interactions, and only 37% reported good visibility into prospects, sales pipeline, deal flow and conversion rates. At the same time, 20% indicated that marketing currently hands leads to sales but has no insight into conversion and sales closures.
  • 13% said that most sales leads are never captured, qualified, or acted upon, while 11% reported that they have no on-premise or on-demand CRM system in place.
  • Among those who have CRM applications, only 13% viewed the application as “highly valued and widely deployed”, while 42% reported growing acceptance and adoption. And, while CRM systems tend to be mandated and adopted across the sales function, they tend to be more selectively embraced by marketing teams.
  • Data analytics, reporting, and forecasting tend to be the biggest deficiencies in optimising the functionality and usability of current CRM solutions. The top three areas highlighted by nearly 50% of respondents were: the ability to easily create analytical reports; customisation of the application; and forecasting capabilities.
  • While 50% said they had “pretty good” or “extensive” visibility in to customer accounts and business activity, the remaining 50% said that they often had trouble finding customer account data, did not have enough information, or had no information at all.
02
Aug
08

Customer-facing analytics – building relevance to business

DM Direct has interesting article on how now it is important to take data, information & analytics from back-office to front-office if it has make business impact & drive ROI. At Cequity, we have been constantly talking to business leaders in different forums and also advising our clients that it is imperative to find methods to convert data into action in real-time. Else, given the huge data decay that happen over a period of time, one always tends to use data to analyze the past rather than influence the future or proactively manage the present. This is really where we believe enterprises must build competitive advantage with data analytics and data-driven marketing.

Take a look at  what the DM Direct article has to say about this:

We’ve all been through it. After a frustrating attempt to figure out a discrepancy in your phone bill online, you finally give up and call the company. After being transferred twice and speaking to three people who each had to validate your information and ask what the problem was the problem of customer-facing analytics takes on real meaning.

Improving Phone Interactions

Most people who call into customer service are already irritated. The best way to transform an unhappy customer into a happy one is to address his or her problems quickly, interact with the customer on a personal level, listen to (and document) their issues and provide information about what will happen next. A customer service representative armed with information can transform a bad situation into a memorable, positive experience.

For those instances when a customer calls into an organization for reasons other than a problem – for example to start a new service – customer-facing analytics provide the customer service representative the ability to capture information about a prospective client and tailor offerings to the individual’s needs. For example, a phone company can sign up a family for the most cost-effective plan. Analytics provide the ability to cross-sell and upsell based on consumer patterns, versus promoting a cookie-cutter offering for all customers and making them feel that they’re just another checkbook.

Personal Touch

In-person encounters with customers provide the opportunity to make a lasting impression. Any employee can be a company advocate in your campaign to create customer satisfaction, but one behind a computer screen can be a particularly valuable asset. In addition to providing good service, a customer service representative can ask better questions to serve a customer, provide insights into products that may interest the consumer and appear more knowledgeable.

As analytics improve, it’s astonishing how good computers have become at “guessing” what you’d like. Netflix predicts what movies a viewer will enjoy based how the viewer has rated other movies in the past. Through the simple application of customer analytics, the Netflix Web site provides a valuable recommendation service. Customers expect this level of service, and it’s becoming commonplace on successful businesses’ Web sites.

02
Aug
08

Loyalty data translates in better marketing

According to a Nielsen report on consumer insights, stronger and longer-lasting customer relationships can be achieved by a sound analysis of shopping behaviour, leading to targeted marketing programmes.

At Cequity, our belief is that loyalty marketers don’t really use their loyalty marketing data effectively for creating tangible business impact. Our belief is that loyalty data has to be effectively used in real-time(week after week in grocery retail or month after month in lifestyle, CD/IT retail) in target marketing campaigns to build ” value perception” & ” personalized service/rewards privileges” amongst loyal customers.

Take a look at what the Nielsen Report has to say:

Foundations of loyalty
In an increasingly competitive marketplace, companies that use their loyalty programmes to establish a deeper relationship with their customers are better positioned to prosper. Two foundational factors are especially important within any loyalty scheme:

  1. Maintaining good customer data with insights, which can be easily distributed throughout the organisation for decision-making;
  2. Developing a business culture that constantly looks for ways to improve programmes that benefit customers by applying shopper insights.

Creating a process for gathering insights, testing programmes and learning about customer response is important. While a few interesting facts about a cardholder’s household composition might come from the initial card application, such information and even deeper insights may also be derived by capturing sales history and assessing information about customers from transactional-level purchase data.

Sales data not only tells an analyst about additional family members in a cardholder’s household, but it also identifies opportunities to target the household more uniquely through a better understanding of preferences for specific categories, products and brands to satisfy the special needs of a child or any other household member.

Analytical models
Increasingly-sophisticated models also enable analysts to understand why customers shop, how they shop, what they buy and how sensitive they are to various price structures. If properly collected and assessed, sales data can point out everything from pets in the home to family health and nutrition needs. Analysis of the data becomes one way to answer those burning business questions:
· What do customers want?
· How can I keep them shopping in my stores?
· What opportunities exist to increase sales?

The data, analysis, and decision-making are only as good as the commitment by business leaders to continuously apply the insights to developing programmes that positively impact customer behaviour. This kind of transformational change and the impact it has on the enterprise takes time. If leadership embraces the use and application of customer data, the business will follow. Even then, the business must adapt in other ways.

Structural changes needed
Organisational and structural changes are required to re-align goals and incentives or develop planning processes that place a focus on the customer. The end result, however, works. Nielsen Loyalty has witnessed established retailer programmes achieve:

  • Sales effect increases of 1% to 5% in same store sales;
  • Loyal customer basket sales increases of 5% and 9%;
  • New customer retention rate increases from 20% to 40%;
  • Supplier funding for insight and communications rises from 0.05% to 0.1% of sales;
  • Promotional budget savings from 20% to 40%;
  • At least 75% of sales tracked at customer-item level.

Every aspect of a retail business and the interaction with supplier partners must embrace the needed changes for these levels of success to occur. It does not happen quickly, but the sooner the shift in focus occurs, the sooner all parties can begin trialling new solutions.

A good example
One North American retailer, well known for rewarding it best “Platinum Fans” customers, wanted to use its Loyalty card programme to further build customer affinity and grow sales. By all accounts, this grocery chain has earned some measure of success-achieving over 85% of sales on card by reinforcing a message of customer value, targeted offers, and special services. These loyal customers received periodic special in-store gift cards and coupons presented to them directly by the store manager for maintaining high loyalty thresholds.

02
Aug
08

Gearing-up for Mobile Number Portability(MNP)

In India, yesterday the Government has announced the deadline & a roadmap for Mobile Number Portability ( MNP). Cequity believes this is going to be an important challenge for telecom operators in India and there is a need for huge customer retention & targeted marketing efforts in gearing-up to this environment, as this is just a few months away.

Here’s is how South African Mobile operators have approached this challenge:

The introduction of Mobile Number Portability (MNP) enabled South African mobile phone service customers to retain their phone number when changing mobile service provider, this was expected to test customer loyalty and trigger far higher levels of churn, as it did in other countries that have already introduced number portability. Analysts believed that more than one-quarter of consumers (a predicted 27%) will change networks within one year of the service becoming available, and such predictions have ensured that customer retention is now firmly at the top of the agenda for the country’s mobile operators.

What drives churn?
Although particularly rife in fiercely competitive industries such as telecoms, customer churn is a significant problem that spares very few companies. The mobile communications industry in particular is largely product driven and price conscious – two traditionally strong reasons for runaway customer churn. But Moodley suggests that the main driver of churn may actually be service delivery, both in terms of customer service and network performance.

“Although it might appear otherwise, with price conscious customers clamouring for the latest and greatest handsets, these reasons tend to cancel themselves out in the age of hyper-consumerism,” said Moodley. “And products and service packages are quickly replicated by the competition anyway, so there is no real, enduring advantage from either.”

“The higher rates of churn will predominantly be from customers with existing complaints or reasons for wanting to move, simply taking advantage of MNP.”

Predictive modelling techniques based on empirical evidence and analytics can help find churn patterns. By combining a variety of mathematical techniques, including artificial neural networks, statistical regression, and decision trees, many SA mobile operators determine the propensity of any individual customer to cease doing business with a company within a given time period.

The results are often surprising: “You might be under the impression that customers want the latest phones or trendier outlets, but – for example – a large number of those leaving the network may have experienced a considerable number of dropped calls in the past six months.”

Analytical customer management strategies can certainly be helpful for mobile phone network operators because they have unusually rich transactional data, which allows very specific patterns and results to be identified.

Cequity View Point: Collaborative & iterative approach is the need of the hour

Continuous, easy & quick analysis will be very useful and to maximize the efforts of marketing, customer service, and other departments, data analysis has to work in a synergistic manner. Analytical insights must be effectively used by marketers to have an interactive “dialog” with their transactional data–and also allow a cross-functional team to review the latest data and create meaningful interactions with customers that are most at risk at any given time.

Better access to and understanding of customer data will help circle heads take informed decisions and help build better customer relationships. Faster cycle times can accelerate deeper understanding and improve time-to-market–both will be key to success in an increasingly competitive marketplace like India.

The key to effectively combating number portability related churn is a flexible and iterative approach.




At Cequity, we believe customer intelligence will be the biggest competitive advantage enterprises will have in the next decade or two. Successful enterprises of tomorrow will be the ones who can organize and leverage this information at speed to optimize their marketing performance, increase accountability, improve profit and deliver growth. Cequity insights will bring to you trends and insights in this area and it’s our way of sharing best practices so as to help you accelerate this culture and thinking in your organization.
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