Marketing in crisis: using analytics, data and intelligence

1THoM_SPSS_Marketing Crisis_11062009.v3.ppt

Analytical deployment (in marketing):All excuses not to do it are valid …

… but not sufficient

June 11, 2009


1. Getting to the breadth and depth

2. Getting to impact

3. Getting to change

Agenda


Old approach Revolutionary approach

Reliance on survey data

Focus on outcomes of consumer decisions

Measuring marketing effects

Use descriptive models

Focus on short-run profitability

Insights from marketplace data

Examine the process consumers use to make decisions

Optimizing marketing activities

Use models based on behavioral processes

Emphasize drivers of long-term value

Analytical deployment offers a new edge to marketingAn extract

Source: Chicago Booth Magazine, Spring 2009: “A Revolution in Marketing”


Analytical deployment is about enhancing the full organization, not just adding competences

Analytics is a way to do business mainly with your current business model

• It is therefore not just a competence you can centralize or departmentalize (parking)

• But it cuts through silo’s of the organization to deliver (sharing)

Many development frameworks exist to support this deployment, and all aim at

• Supporting a cultural shift

• Aligning management

• Building benefits for all actors

• Locking it in into daily processes


Understanding the depth and impact of analytics usage is key to enhance a company-wide adoption

Source: Jim Davis, SPSS

8 levels or sequences of analytics usage in a company

Standard reports

Querydrill-down or OLAP

Alerts

Statistical analytics

Forecasting

Predictive modeling

Ad-hoc reports

Optimization

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2

3

4

5

6

7

8

Leadership

Transparency

Infrastructure

Processes

People

Culture

Per level, the readiness on the following 6 ingredients need to be evaluated

Access and reporting Analytics


BI as part of analytical deployment…

Source: Business & Market Intelligence Kinepolis Group, Presentation at The Datamining Garden

Strategic Information Layer

Tactical Information Layer

Operational Information Layer

The dashboard from your BI: recurrent and

fixed

Checking the validity of your dashboard

input: Does this happen ?

Checking the validity of your

business assumptions: Does

this happen?

Reporting


… Reporting versus Analytics: a world of difference

Source: Business & Market Intelligence Kinepolis Group, Presentation at The Datamining Garden; Web Analysis 2009, THoM

Strategic Information Layer

Tactical Information Layer

Operational Information Layer

REPORTING

ANALYSIS

ANALYTICS

The point: If your "analysis" is really reporting, you haven't even begun to leverage the information contained in your data

The point: If your "analysis" is really reporting, you haven't even begun to leverage the information contained in your data





Agenda


Analytics helps increasing competitiveness and profitability on top of your traditional means

Source: GIA White Paper 2/2008: World Class Market intelligence – From firefighters to futurists; THoM

• Better and faster decisions

• Time and cost savings

• Organizational learning and new ideas

• Top-line and bottom-line mastering


The effect of analytics Benchmarked best practices: extract

The benefits are not increments, but a factorReal life examples

Source: Marketing Analytics to the Rescue: The Next Big Thing? David J. Santoro DM Review Special Report, February 2003

Before applying analytics

After applying analytics

Banner ad click-through rates

Mail response rates

Merchandising response rates

Conversion rates (post-response)

Repeat buyer rates

0.3%

0.5%

0.2%

0.9%

2.0%

21%

18%

12%

10%

60%

Best practice

performance

Performance measure

• X-sell response rates

• Repeat buyer rates

• Referrals

• Direct marketing ROI

Improvement measure (after vs. before)

• Churn reduction

• Increase in per customer profit

20%

60%

20%

12:1

78%

15%


And benefits can be achieved in every marketing domain

What business problems does data mining/analytics solve?You can use data mining to solve almost any business problem that involves data, including:

• Increasing revenues from customers• Improving cross-selling and up-selling• Understanding customer segments and preferences• Identifying profitable customers and acquiring new ones• Retaining customers and increasing loyalty• Increasing ROI and reducing marketing campaign costs• Detecting fraud, waste, and abuse• Determining credit risks• Increasing Web site profitability• Increasing retail store traffic and optimizing layouts for increased sales• Monitoring business performance

Source: SPSS

Data mining solves a common paradox:The more customer data you have, the more difficult and time-

consuming it is to effectively analyze and draw meaning from them

Data mining solves a common paradox:The more customer data you have, the more difficult and time-

consuming it is to effectively analyze and draw meaning from them





Agenda


“Let’s find out how to get more out of your data and analytics …”

The TOP 10 responses / excuses:

We have lots of data but not a lot of info proportionally

We have lots of reports and analyses already / We have BI (business intelligence) all over the place

We already analyze too much and act not enough (analysis paralysis)

We are already managing our performance quite well

We are improving our operations continuously; what could this bring more ? / Management will not be supportive

No way you can ever have this company increasing analytical intelligence across the board

You can’t really talk with data people

We already have analysts

I’m in B2B, not B2C / I have resellers or partners, not end-customers

We don’t have much or usable data / We wait for our CRM system first

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4

5

6

7

8

9

10


Analytics

Techniques

Quantitative and multidisciplinary• Statistics• Econometrics• Operational research• Artificial intelligence• Data mining

Modeling capability• Regression, clustering, decision trees, …

Methodology: • Approach• Tactics for issue resolution

Data management on large databases

Database design

IT programming

BI tools• Reporting• Analysis

Business

Communication

Contextual• General business understanding• Particular business need of a specific decision maker

Applicative• Understanding the final use• Knowledge on requirements• Actionability of conclusions• Relevancy of outcome• Urgency/Prioritization of requests• Flexibility

Translating into and talking in the semantics of the decision maker

Highlighting the relevant trade-offs to the users

Convincing on benefits and relieving ‘old’ prejudices of data usage

Committing to business impact

Cross-functional linkages

Minimum 4 competences required to get from data to impact, given a full analytical deployment

Source: The Datamining Garden, presentation of Dr. Martine George, Customer Intelligence ING

1 2

3

4


Long chain of functions to get from data to analytical decision making

Data WarehouseManagement

Data

DecisionMaker

DatabaseArchitect

Data Quality Controller

Database/ Delivery Manager

BI/Reporting Analyst

Business Analyst

Intelligence Analyst (data mining)

Business Project Manager

17THoM_SPSS_Marketing Crisis_11062009.v3.ppt 17

[email protected]

+ 32 474 94 60 15

Let’s get started


Analytics: Deploying in crisis times to pick up targeting, behavior change, top- and bottom-line potential

To assist companies in times of economic crisis, THOM offers an analytical assessment (AA) and business action pilot (BAP) designed to be fast, create new value and insights for your company and build the first stone for tremendous competitive benefit and continuous improvement in marketing effectiveness

• Identify quick hits for immediate improvements to your current working of analytics

• Analytical progress map applied to marketing and sales (for short and long term deployment)

• Execution of a pilot and measurement of the analytics benefits

• Insights on how to speed up analytics outside the currently claimed barriers for analysis

• Overview of gaps and opportunities to convince top management of investment into analytics

OUR VALUE PROPOSITION

VALUE AND DELIVERABLES

• During an Analytics Assessment (AA) - A check is performed with your IT and information users on data quality, availability and accessibility for the deployment in sales & marketing: 1-2 weeks

- The base options for analytics and data leverage are listed, discussed and prioritized for sales & marketing: 1-2 weeks

• During a (consecutive) Business Action Pilot(BAP), a single marketing and/or sales action objective is researched and optimized with predictive analytics: min. 3 weeks; implementation pilot comes separately, but support often not required, except for final result measurement

• During a Marketing Analytics Fulfillment Evaluation (MAFE), the functional chain of analytics is screened for gaps and opportunities, communication facilitation tips are given, barriers and missing areas in analytics are revealed, and if possible one action based pilot is set up: min. 3 weeks

IMPACT: • TARGETING: up to 10 times better• CHURN: up to 50% less• COST of initiatives: up to 30% less• SALES efficiency: up to 30% better• X-SELLING: up to 20% more

APPROACH


The House of Marketing is the first Marketing Expertise and Excellence Center

• We support our clients to “Bridge the Marketing Knowing-Doing Gap”, i.e. improving business results by developing and activating strong and effective growth strategies

• By offering the right marketing expertise at the right moment

• With an enduring passion for the marketing profession and for client satisfaction

• Ensuring solutions applied by market facing teams with a common focus on the customer

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A unique combination of strategic excellence and operational pragmatismThe mix of professional profiles makes The House of Marketing unique

Our consultants

• Create relevant insights in the business

• Have proven track record in international strategic advice

• Team up with your “best in class” high potentials

• Identify the true leverages for significant improvements

• Turn opportunities into structured and prioritized business initiatives

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We help you in materializing ideas into well-considered and successful business initiatives

We help you in materializing ideas into well-considered and successful business initiatives

Our marketing experts

• Demonstrated capacity to make things happen within international and complex companies as well as in local action-driven business units

• Apply practical knowledge of successful corporate sales & marketing organizations

• Turn initiatives into tangible actionplans

• Help you to implement successfully strategic recommendations

Operational pragmatismStrategic excellence


Our expertise is built on 4 pillarsEffectively bridging the Marketing Knowing-Doing Gap

Helping the company make relevant strategic choices

• Market assessment, growth and new product strategy

• Insights in customer perceptions, needs and segmentation

• Branding, positioning, satisfaction research and strategy

• Pricing opportunity assessment and strategy

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Making the positioning tangible: creating marketing value

• Go to market strategies across 4 Ps

• Value based pricing

• Customer experience and customer loyalty

• Integrated 360° marketing communication

Making the strategy work

• Customer Process Management

• Customer relationship management (CRM)

• Marketing & sales organization structure

• Marketing competencies assessment and capability development

Making the strategy profitable: maximizing marketing value

• Customer Life Time Value Management

• Return on Marketing Investments or assets (ROMI/ROMA)

• Performance metrics and marketing dashboards

• Marketing Analytics

I. Strategic Marketing

II. Go-to-Market

III. Organization capabilities

IV. Performance Management

Marketing in crisis: using analytics, data and intelligence

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