Customer Intelligence Blog

Today’s New York Times sported an article on “The Age of Big Data” (http://www.nytimes.com/2012/02/12/sunday-review/big-datas-impact-in-the-world.html?_r=1&hp), which is fast becoming the hottest topic in business. It’s no secret that we are awash in data. IBM’s recent CMO study shows that over 70% of marketers say that the “data explosion” is what they feel the most unprepared for (http://www-935.ibm.com/services/us/cmo/cmostudy2011/cmo-registration.html), and it’s no wonder: every day we create an additional 2.5 quintillion bytes of data – so much, that over 90% of the data in the world today has been created in just the last two years (http://www-01.ibm.com/software/data/bigdata/).  Because there’s so much data, we have a “big data” problem, primarily technical in nature: the volume of data is just so vast, that many of the existing tools for capturing, storing, managing, searching, sharing, analyzing, and reporting on this data are inadequate. But we also have a business problem in addition to this technical problem: “big data” will generate a vast number of insights to sift through. These insights need to be examined, evaluated for impact, prioritized, and implemented to achieve real business results. This is the key issue: how do we deal with this on a practical, day-to-day basis that extracts the maximum business impact from all these data and insights?

We need a practical approach to generating and using insights in day-to-day business. Here are 5 tips that can help us get there:

1. Embrace data.  Since it’s obvious “big data” is here to stay, we’ve got to embrace it. It will impact each and every business decision you make. Ask yourself: what data do I need to support the decision I’m making right now? Where does that exist in my organization? Who are the gatekeepers? Are there tools I can use myself to get access to this data and generate my own insights? Although we don’t all have to be experts in data warehousing and multiple regression, we’ve all got to learn to become data manipulators and insight generators to a certain extent, and have to become quite comfortable with using data on a day-to-day basis in our work. So stop worrying, and learn to love the data!

2. Start with what you know. This is probably going to make a lot of analysts out there cringe, but I’m going to say it anyway: you have to start with the base of knowledge and experience you already have in order to generate new insights from data. Many die-hard business analysts will say you need to “trust the data” and “let the data tell you what’s important,” but that ignores the important role of prior knowledge and experience in formulating insights.

3. Take one step at a time.  You and your organization are not going to snap your metaphorical fingers and find yourself in the ideal world of your analytic dreams, with all data throughout your organization mastered and at your fingertips for instant insight generation, no matter what business problem you may encounter. It takes time, and the only way to begin is, well, to begin. Start small: use the data you have in your organization to solve the problems you can solve with that data. Add data with your internal teams, driving it with business need. Identify gaps and plug them. And, above all, remember to keep moving and making incremental progress, every day.

4. Act now (do something).  With all this data and insights, we often forget that the whole point of insight generation is to have a real business impact. This means that you actually have to do something with the insights you generate – you can’t just pat yourself on the back after producing a masterful and insightful piece of analysis, you have to implement it and obtain a real-world business result (hopefully a positive one that will drop extra dollars to the bottom line). It’s good practice to have a bias to action, a willingness to act and to do something rather than nothing. Make it a habit to perform at least one action as a result of any insights you generate, and soon you and your organization will be an insight-to-action machine.

5. Measure what you do and repeat.  Finally, it’s important to realize that all of this insight-driven activity has to be measured, tracked, and reported on. How are you going to know whether your insights had validity, whether the actions based on those insights had the desired effect, and whether you should do more of the same or stop doing that and do something else instead? It’s crucial to realize that this is a continuous process you’re embarking on, one of constant data-gathering, insight-generation, directed and measured actions, and tracking to determine success or failure. It must be repeated, over and over again, as a core business function as important as generating invoices or keeping track of accounts receivable. If you treat this as a one-off and not a continuous process, your efforts will be doomed to failure before you even get started, because you will cut yourself off from the opportunity to use the learnings generated from your actions to do better next time – and that’s what it’s all about.

Do you notice that everywhere you go banks are just about everywhere? When you happen to be walking along the streets, you will notice that these establishments, big or small, are located on just about every corner. However, reality bites for some small banks because bigger and more popular banking groups can overshadow them. Luckily for these small players, keeping new clients and attracting more can be easily achieved through efficient bank marketing ideas that are excellent but not necessarily costly. Their effects extend beyond the long term, so here are 3 bank marketing ideas that are quite popular among banks nowadays.

Rewards Program

Who doesn’t love getting something for nothing? Many banks discover successful bank marketing by providing customers with free gear and merchandise as a reward for using their institution for their financial needs. Most bank marketing ideas will begin with a reward or gift when a new customer opens a checking and/or savings account. When trying to attract higher profile clients, banks will have to step it up a bit and offer some more extravagant bank marketing rewards.
A wealth management company in Kentucky recently rewarded some of their clients with deeper pockets with things like shopping sprees, hunting trips, fishing excursions and paintball outings. These types of bank marketing ideas have a two-fold benefit. They not only keep clients satisfied, but also provide bank management with an opportunity to get out and interact with their clients directly, establishing an interpersonal bond with them.

Free Stuff

Effective bank marketing can be as simple as it sounds. When you offersmall gifts to your clients every day, it can aid in making the environment trusting and kind. A lot of successful banks give away candies to their clients and their children. It is also a good bank marketing idea to be as creative as possible and provide pet treats for clients who arrive with their pets. This kind of bank marketing doesn’t convert to new business immediately, but it gives a sense of belonging and goodwill between the bank and its customers that can last for a very long time.

Signage

Bank marketing ideas begin and end with signage. In the world of business, out of sight really is out of mind, and although your bank may have your name and logo on the building, there are other ways ensure people know who you are and what you do. Simply having a temperature and time display along with your logo will draw attention. This can be a beneficial bank marketing tool, as customers will drive or walk by and glance at the time or temperature, subconsciously taking note of your logo and name.

Adding more information that is interesting like new products or deals can get much more attention. Displays of banking hours are very informative and a wise marketing move. Including a short message that is regularly updated will encourage clients to drive within the vicinity just to check out what’s new on your signage. This is essentially what bank marketing really does – ensuring that clients know and remember your bank name and logo, what you have to offer, and continuously seek you out.

It’s been said that the job of the strategist is to create little monopolies; to identify segments of the market where the company’s product/service package is so uniquely well positioned that the competition’s offering doesn’t get serious consideration. In effect, it doesn’t exist. From the customer’s perspective, the only real alternative to buying the company’s product or service is to do without.

When products or services are properly targeted, members of the segment are willing to pay significant premiums. For example, American Express has been able to position their platinum charge card as a high end, prestigious card with lots of perks. Platinum cardholders are willing to pay a $450 annual membership fees for the privilege of using this card when they could easily obtain a Master Card or a Visa for free. There can be real value associated with targeting a product/service package to the appropriate market segment.

But, market segmentation isn’t a magic wand that always delivers value. We worked with a manufacturer of electronic connectors that segmented their market by industry (e.g., chemical, machine tool, package goods, etc.). But, the segmentation failed to create additional value.

So, what makes a good market segmentation that will allow companies to profitably target their products and services to customers who will pay a premium for them? There are two criteria for developing a market segmentation that works. First, members of the segment must make the buying decision like each other and differently from those not in the segment. Second, members of the segment must be externally identifiable or they must be willing to self-identify. Each of these requirements will be discussed below.

The key to effectively segmenting a market is to understand how customers make the buying decision. What characteristics of the product/service package are most important to each group of customers? The problem with the market segmentation used by the manufacturer of electronic connectors described above is that the customers in each segment made the buying decision in the same way. The same characteristics were important to each customer. Therefore, there was no opportunity to differentiate the product/service package to specifically meet the needs of one subset of the market. As a consequence, segmenting the customer base by industry wasn’t helpful.

Conversely, market segmentation is often critical. For example, automobile manufacturers must target specific segments. Some people are looking for basic transportation with a low cost of operation (i.e., good gas mileage and low maintenance costs). Other car buyers are interested in a sporty looking, high performance automobile. Still others are interested in luxury and prestige. More recently, a segment has emerged that is primarily interested in a car that is environmentally friendly. One product cannot possibly satisfy all segments. Product design and advertising are specifically intended to position the manufacturer’s offerings closer to the wants and needs of a given segment than those of the competition.

Assuming that differences in the way customers make buying decisions exist, to be useful for market segmentation, the customers in each segment must be externally identifiable. Marketers need to know how to reach the specific segments. Should the company advertise in Sports Illustrated or Cosmopolitan? Alternatively, the members of a particular segment may be self-identifying. For example, if a man intends to buy a suit, those who walk into Sears, The Men’s Warehouse, Joseph Bank’s, or Franco’s are fairly clearly members of different market segments.

Effective market segmentation can be an incredibly valuable tool for increasing profits. However, to gain the benefit businesses must take the time to understand how the buying decision is made and how they will attract the potential customers in their target segment. Although this may sound straight forward, our experience is that sorting this out can be complex. But, the rewards are worth the effort.

Doug White is the author of Let Go to Grow – Why Some Businesses Thrive and Others Fail to Reach Their Potential. His new book discusses how the role of the principal must change as a business grows. He is also a Principal with Whitestone Partners, a firm focused on helping small businesses to succeed. He has twenty-five years of experience helping companies achieve their goals through improved performance.

He began his career at McKinsey & Company where he was a consultant for almost seven years. Subsequently, he held jobs as CEO or COO for several companies over fourteen years ranging in size from start-ups to large midsized companies. Additionally, Doug successfully managed divisions of a Fortune 200 company where he had P&L responsibility. He has successfully worked in fields ranging from heavy-duty manufacturing to sales and distribution to consumer lending to investment brokerage.
Doug holds a BS in Physics from Randolph-Macon College. He earned a BME with very high honors and an MSME from The Georgia Institute of Technology, and an MBA with distinction from Harvard Business School.
Article Source: http://EzineArticles.com/6253391

Why is it hard to retain customers? Of course there’s the ongoing battle with competitors. They may make highly attractive offers to your customers that are hard for them to refuse, and their brand affinity may have strong appeal to your customers – brand affinity is positive association built through cause marketing, perceived social status and so forth.

Over-focus on customer acquisition teaches them to switch brands. For example, the brand switching rate, called customer churn, is 40% for the mobile phone industry, compared to a 7% churn rate for the insurance and financial services industries. As growth slows in acquiring new customers – either due to the economy or to shrinking technological gaps with competitors, more companies are pursuing customer retention as a vital corporate strategy.

Not Planning or Funding Retention
Most executives and marketers can quote the well-known universal statistics on retention – that a small improvement in the number of customers retained can have exponential improvements in profit – yet only 39% of companies say their marketing plans contain specific customer retention strategies, and only 28% of companies say they have funds set aside to specifically support those strategies.

In fact, 89% of firms view customer experience management as very important or critical to their firm’s strategy in 2009, according to a study by Forrester Research. In creating a marketing plan for retention, be sure to include the entire experience spectrum, which begins at the point when prospects are aware they have a need for a solution, through the point at which they perceive they no longer have that need.

Really Know Your Customers
In addition to customer involvement methods, do your marketing tools support retention as well as they support acquisition? Your databases should tap into all phases of the experience spectrum. Three-fourths of companies admit they have fair or little knowledge of their customers; the same number say customer experience is not well defined and communicated within their company. Three-fourths of firms say their employees are not well-versed in how to delight customers. For database use, it’s best to segment your customers by lifetime value, create customer experience personae and develop ways to predict behaviors. Best Buy is a great example of identifying customer personae and training their employees to cater their services to the specific needs and expectations of the personae.

Do What You Say
So we re-visit the question, why is it hard to retain customers? It goes back to the basics – doing what you say you’ll do – in product, service and value promises, and really knowing your customers. A recent quote I heard from Peppers and Rogers is that half of companies say they have fair or little knowledge of customers’ demographics, behaviors, psychographics and transactions. Two-thirds of companies say they have no processes in place for reactivating dormant or lost customers.

As the 2009 Edelman Trust Barometer emphasizes, customers view product and service quality by far as the most important components of trust. Way down on the list are state of the business, innovations, supporting the public good, and commitment to the environment. Since trust is the basis for long productive relationships, then your customer retention strategy must include oversight on product and service deliverables meeting or exceeding the brand promise featured in marketing communications.

A study by the London School of Economics examined the revenue gains by increasing positive word-of-mouth and by reducing negative word-of-mouth. They found that reducing negative buzz pays off 300% over improving positive buzz.

Customer retention may be best supported by operational integrity. After all, when you think about your personal relationships as well as your business relationships, you tend to stick with the folks that are really good at showing they sincerely care about you, and doing what they say they’re going to do. It boils down to trust. When you dig down to the reasons why people leave a brand for a competitor’s solution, it’s not so much about the competitors’ offers and brand affinity – but the reasons people switch brands is much more about product, service and value disappointments. Companies make huge investments in communicating their value proposition. Logic says a corresponding investment – at least in energy and scrutiny – should be made in making sure their value proposition is lived up to. Trust is the best way to retain customers.

Common Practices vs. Best Practices
To sum-up, you can retain customers by locking them into contracts. But a better way is to encourage customers to invest non-transferable equity in your brand – for example, customers might store their photos or contacts on your site, or they may have social connection perks through your brand that can’t be readily transferred to your competitor. This is better, because it’s the customer chooses his or her level of involvement and tie-in with your brand.

You can retain customers through unique technologies that competitors don’t offer, either due to patents or lack of common standards. But a better way is to develop customers’ passion for your brand. This is being done by many companies, as seen in the examples of customer involvement shown earlier in this presentation.

You can retain customers by resolving problems as they arise, escalating issues for high-value customers, and rewarding heroes who save the day with at-risk customers. But a better way is to prevent customer hassles in the first place, by creating customer experience personae that help your entire workforce really know the customers, using personae to guide business policies and processes, and being proactive in predicting at-risk customers, promptly reaching out to them, sharing your customer feedback summaries and achievements in response to customer feedback, and embracing customer complaints with solid problem resolution that prevents recurrence of customer hassles.

Culture & Prevention are Under-Managed
The building blocks of customer retention are culture, tools, prevention and passion. The more customer-centric and trust-building your culture is, the more likely you will be to retain customers at a higher rate than your competitors. The more you include customer retention in every marketing plan and budget, the more likely you are to retain customers. Hand-in-hand with customer-centric culture is prevention of customer issues, making the customer’s reality match or exceed your value proposition. And finally, build passion through customer involvement.

Marketing tends to do pretty well in the tools and passion area, but the culture and prevention areas tend to be neglected, relatively speaking. For more ideas on how to improve effectiveness in culture and prevention areas to maximize customer retention, see customer.ology.com.

Customer retention is smart business! In a study done last year, best-in-class customer experience practitioners were compared to industry average and laggard customer experience practitioners. The year-over-year gain in customer retention was 15% for best-in-class customer experience practitioners, compared to 1% industry average. Customer satisfaction and profit were markedly higher for best-in-class customer experience practitioners.

Lynn Hunsaker mentors executives in Customer Experience Optimization, to deliver brand promises, prevent customer hassles, minimize churn, & heighten sustained profit. Specialties include customer value guidance, touchpoints, loyalty behaviors, internal branding, experience innovation, experience panorama, survey ROI, marketing and customer relationship skill-building, predictive dashboards, team recognition. She is author of the handbooks Metrics You Can Manage For Success and Customer Experience Improvement Momentum.

Article Source: http://EzineArticles.com/2463934

It’s the time of year when every blogger seeks, Nostradamus-like, to pierce the veil and lay bare the secrets of the future. No different, I hereby offer my 5 predictions for CI in the New Year. Enjoy!

1. The biggest will get bigger – sort of. Scale begets scale, and the very largest companies will continue to pour massive amounts of moolah into databases, analytics, modelling, and all things Customer Intelligent in 2012. Results will continue to be mixed, however, as the largest companies will rely on the vendors that they trust – not surprisingly, other very large companies like IBM, ACXIOM, Experian, Dun & Bradstreet – and miss out on the agility and cutting-edge innovation that smaller, more nimble vendors can provide.

2.Innovation will come from the small. A corollary to my first prediction, while the largest companies work with other large vendors and do more of the same (i.e., spend lots of money for not very much benefit), smaller firms will drive innovation. An example is Palantir, a company named after the seeing stones in Tolkien’s Lord of the Rings trilogy, that specializes in understanding very large amounts of data very quickly and has been at the forefront of innovation in big data solutions. Sorry, IBM, but Palantir and others like them will continue to eat your lunch.

3. Continued consolidation will engulf the industry. OK, maybe “engulf” is kind of dramatic, but the point is that consolidation will continue and even increase in 2012 as larger players try to teach themselves to dance by acquiring smaller, more nimble competitors (see predictions one and two above). Consolidation won’t be limited to the large swallowing the small, however; smaller players realize they need scale or will become irrelevant, so they will merge and become engines for growth and change.

4. Big Data will get small. Innovations in storage, processing power, and analytics will wrestle the Big Data problem down to size so that even smaller companies can tackle the problems posed by Big Data. In fact, many companies will rely on ever-more-sophisticated 3rd party solutions, including cloud-based platforms, to solve their Big Data headaches so that they can stop worrying about the data and concentrate on the anaytics and execution – which is where the real Customer Intelligence occurs.

5. Customer Intelligence will go mobile. Innovations in data security, cloud computing, and mobile platforms and technologies will finally push Customer Intelligence out to where it’s really needed – where the sales teams and relationship managers, out on the front lines acquiring new customers and working to help expand and deepen existing customer relationships. Salesforce and other CRM vendors already offer mobile versions of their platforms for phones and tablets, but analytics and true Customer Intelligence applications will catch up in 2012.

Everybody knows that Facebook is eating the world (wide web, anyway): FB now has over 750 million users and reaches 43% of all Internet users. As more and more people spend more and more of their time on FB, however, it means they’re spending less and less time on your website – and that means you can’t track how they’re interacting with your brand.

Traditionally, marketers have used on-page analytics provided by, e.g., Google or Omniture to discover how potential customers were interacting with their sites and which narratives were most effective at increasing engagement and time-on-site. These tools, however, do not work on FB, so you’re blind when it comes to seeing how people are interacting with you on FB. A recent article in Forbes (“What’s a ‘Like’ Worth?”, http://www.forbes.com/forbes/2011/0808/technology-social-media-facebook-google-like-worth.html) shows how vexing this problem is becoming. FB is expanding metrics available to page owners, but only those that suit it’s own purposes. And some, like Hiten Shah of KISSmetrics, think that the old way of analyzing these interactions is dead: “Facebook is giving you data that are relevant to the Facebook model … the page-view game is done with anyway. We want to track people, not page views.”

It’s precisely that, tracking people, that is becoming harder as FB gobbles up interactions with web browsers and people stay longer on FB and less on your site. Are on-page analytics really dead, or do we just need to figure out a way to tease that data out of FB and marry it with what’s going on in the non-FB web? Stay tuned, it’s going to get interesting …