by Ranjan Sinha, Axis Group, LLC
Business Intelligence – The Heart of Micro-Marketing
Business Intelligence (BI) is generally defined as the process of aggregating diverse information (on customers, sales, financial, operations) – typically using an automated system – and analyzing that information to drive more effective business performance. BI systems support basic data mining through advanced analytics, and enable companies to run real-time dashboards to report monitor and business performance.
Marketing organizations are increasingly tapping into business intelligence solutions that have long supported many other organizations within the company. The addition of analytics power and speed of gaining insights is especially valuable for companies committed to marketing ROI and profitability improvements. Big wins com from better targeting, identifying customer purchase patterns, a better view of total customer value, assessing campaign performance, and managing overall corporate performance through dashboard tracking of KPI’s (Key Performance Indicators). To benefit from a BI system, it helps to understand the opportunities available as well as the critical success factors.
Today your customers see themselves as having unique needs and interests. Rather than selling to a vast crowd, marketing profitability improves by instead selling to large groups of individual customers. In a perfect world, an enterprise-wide, unified view of the customer enables business processes to support the increasing demands of micro-marketing. In this world, marketers no longer drown in data but are able to obtain actionable information needed to maintain a competitive advantage. In the perfect world, the organization has empowered data stewards who ensure that the customer information captured is complete and accurate at every customer interaction point.
At the heart of the organization are Business Intelligence applications, pumping useful information to the decision-makers so they can monitor operations in a timely, meaningful way, identify new opportunities, make better decisions, resolve potential problems before they escalate, and predict with better accuracy how the market will react to its actions. It is a circulatory process – assimilate, assess, adjust, assimilate, assess, adjust. With each adjustment, tailored offerings and messages are delivered to increasingly individualistic market segments.
Micro-marketing takes your performance to a higher level as you leverage the data, analytic capabilities and insights that are beating out of this BI heart.
- Your prime target segments emerge as you identify high-potential and high value customers.
- Your marketing precision increases as you promote the right products and services to customers based on the ability to understand customer needs and preferences.
- Your timing improves as you trigger marketing contacts based on specific customer actions that are predictive indicators of possible actions such as attrition, new purchase needs, or upgrade opportunities.
- Your overall marketing spend becomes more productive as you assess campaign effectiveness and shift your marketing mix accordingly.
As with any fitness goal, getting your Business Intelligence heart into shape will take some time. It is likely that data marts and operational data stores proliferate throughout your organization, some joining together in warehouses of sorts, and others pieced together to support the latest merger or acquisition, data purchase, or executive mandate. However, particularly in today’s economic climate, Business Intelligence cannot be allowed to get out of shape. Rather, Business Intelligence should be used to ensure that customer retention and satisfaction goals are being met, and that the most highly valued customers are given the appropriate level of white-glove treatment. This is the perfect time to demonstrate a positive ROI to management and begin to build a healthier heart for the organization to sustain itself.
Creating an enterprise-wide, unified view of the customer from disparate customer records is undeniably desirable and can be costly, but every organization has a good idea of who their best customers are. Beginning with these customers, and adding to the repository over time, provides an opportunity for the entire organization to adapt to their new role in serving the individual customers. Customer service, billing inquiry, sales, and other groups will find it reasonable to provide special treatment for special customers, and over time, every customer will be catered to so each customer is treated like the individual they are. Call center service will smoothly, accurately and responsively be prepared to cross-sell, up-sell and direct the “internet-savvy” in a different way than the “old fashioned” individual, the “delinquent” in a different way from the “responsible”. The most important data your organization has is within your organization already, and the best opportunities for retention and selling are in this data. Seeing your relationship with the customer as the customer already sees it will enable you to identify new opportunities, predict future behaviors, and track the results.
Business Intelligence tools provide the window to understanding your customers and provide the analysis, reports, queries, analytics, dashboards, and scorecards that you need to answer your marketing questions. In addition to supporting micro-marketing during the planning stage, aggregated data that is constantly updated into the BI system provides the ability to manage overall performance through a dashboard that also has the ability to drill down to understand what is driving current metrics.
The dashboard capabilities of a BI system allows the marketing organization to manage performance across all marketing programs to ensure the company is achieving its objectives. Marketing executives can monitor the position and trends of:
- Customer lifetime value
- Acquisition cost of new customers
- Spending on online marketing
- Campaign performance
- Attrition of customers to the competition
And the analytic and predictive capabilities then support the decisions necessary to act on these trends, addressing questions such as:
- Which customers can I win back?
- Who is ripe for an up sell?
- How should I best communicate with them?
- Is the privacy of my customer being managed properly?
- How does our merger affect my customer?
While you may have answers to some of these questions at a high level, aggregates and averages obscure the lowest levels of detail that are needed to predict future customer behavior. Business Intelligence provides access to the lowest levels of detail so improvements in target marketing can be.
Some of the benefits of better BI capabilities include:
- Increasing total customer value
- Campaign tracking to maximize sales growth
- Prioritizing of target segments for retention efforts and/or loyalty marketing
- Understanding the effectiveness of marketing dollars to reallocate budgets to the highest potential
- Managing the business by facts, metrics and exceptions not gut feel
Understanding your business issues and how they relate to Business Intelligence tools that are already in place in your organization is a great place to start. Often times, your organization owns Business Intelligence tools that are underutilized. Sometimes, Business Intelligence tools have been stretched in ways they were not meant to go and are not poised for scalability and future needs. Business Intelligence improvements can often be made quickly and painlessly, demonstrating immediate benefits to management, and improving the trust and confidence that your organization may need to advance longer term Business Intelligence objectives. Business Intelligence is the heart of successful micro-marketing, and catering to your customers as individuals will sustain the health of your organization into the future.
Ranjan Sinha, Principal at Axis Group, LLC, is responsible for leading Axis in strategy, sales and delivery. Since 1996, Axis Group, a leading professional services firm, has delivered hundreds of solutions to satisfied customers at Global 1000 and mid-market organizations. You can contact Ranjan at email@example.com.