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8/11/2019 Teradata Msi Presentation
1/30
CRM Power Tools for Business Results
Intelligence-Based Marketing
Peter HeffringPresident
CRM Division
All rights are reserved. Members of MSI and academic researchers may make
limited copies of this presentation, electronically or in print, solely for their internal,
non-commercial use. Any other use of this presentationincluding reproduction for
purposes other than those noted above, modification, distribution, or
republicationwithout prior written permission of the Author is strictly prohibited.
8/11/2019 Teradata Msi Presentation
2/30
2002
presentedbyPeterHeffringattheMarketingScienceInstitute
sConferenceon
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tions
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Copyright@2001 Teradata, a division of NCR, All Rights Reserved
How Do Your CustomersExperience Your Business?
Intelligence-basedmarketing
The company knowswho you are, what
you prefer, and
communicates withrelevant, timelymessages, using thepower of analytical
intelligence to detectpatterns, decode
strands ofinformation and
create meaningfuloffers and value
Schizophrenicmarketing
The company hasdelusions about whoyou are, forgets what
you prefer, and tries toreach you with off-
target communicationsthat alienate you
based on fragmented
data & inadequatefaculties, resulting in
confusing, chaoticmultiple personalities
8/11/2019 Teradata Msi Presentation
3/30
2002
presentedbyPeterHeffringattheMarketingScienceInstitute
sConferenceon
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tomer
Rela
tions
hipManagemen
t:
Cus
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hav
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Organ
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tiona
lCha
llenges,
an
dEconome
tricMo
de
lson
January
31F
ebruary
1,
2002
.
Copyright@2001 Teradata, a division of NCR, All Rights Reserved
I cant believe it. Ive been a goodcustomer for ten years. And theystill dont get me and the things
that interest me.
8/11/2019 Teradata Msi Presentation
4/30
2002
presentedbyPeterHeffringattheMarketingScienceInstitute
sConferenceon
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tomer
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tions
hipManagemen
t:
Cus
tom
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Be
hav
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Organ
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tiona
lCha
llenges,
an
dEconome
tricMode
lson
January
31F
ebruary
1,
2002
.
Copyright@2001 Teradata, a division of NCR, All Rights Reserved
Hey! Just because we bought
Dad a tool set last year doesnot mean we want to see everydrill bit in your inventory.
8/11/2019 Teradata Msi Presentation
5/30
2002
presentedbyPeterHeffringattheMarketingScienceInstitute
sConferenceon
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tomer
Rela
tions
hipManagemen
t:
Cus
tom
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hav
ior,
Organ
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tiona
lCha
llenges,
an
dEconome
tricMode
lson
January
31F
ebruary
1,
2002
.
Copyright@2001 Teradata, a division of NCR, All Rights Reserved
I have 2 million frequentflyers with your airline andstill do not get respect
8/11/2019 Teradata Msi Presentation
6/30
2002presentedbyPeterHeffringattheMarketingScienceInstitute
sConferenceon
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hav
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llenges,
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dEconome
tricMode
lson
January
31F
ebruary
1,
2002
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Copyright@2001 Teradata, a division of NCR, All Rights Reserved
Remember the bad times?
8/11/2019 Teradata Msi Presentation
7/30
2002presentedbyPeterHeffringattheMarketingScienceInstitute
sConferenceon
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ations
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dEconome
tricMode
lson
January
31F
ebruary
1,
2002
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Copyright@2001 Teradata, a division of NCR, All Rights Reserved
I need personal
attention - help me!
8/11/2019 Teradata Msi Presentation
8/30
2002presentedbyPeterHeffringattheMarketingScienceInstitute
sConferenceon
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tomer
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lations
hipManagemen
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tom
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Organ
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tiona
lCha
llenges,
an
dEconome
tricMode
lson
January
31F
ebruary
1,
2002
.
Copyright@2001 Teradata, a division of NCR, All Rights Reserved
Give me
convenience!
8/11/2019 Teradata Msi Presentation
9/30
2002presentedbyPeterHeffringattheMarketingScienceInstitute
sConferenceon
Cus
tomer
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lations
hipManagemen
t:
Cus
tom
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Be
hav
ior,
Organ
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tiona
lCha
llenges,
an
dEconome
tricMode
lson
January
31F
ebruary
1,
2002
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Copyright@2001 Teradata, a division of NCR, All Rights Reserved
Help measap!
Servicenow!
Respect me!
Quality of life!
Convenience!
Make it easy!
Dont embarrass me!
8/11/2019 Teradata Msi Presentation
10/30
2002presentedbyPeterHeffringattheMarketingScienceInstitute
sConferenceon
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Cus
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dEconome
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January
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ebruary
1,
2002
.
Copyright@2001 Teradata, a division of NCR, All Rights Reserved
The Marketers Task: Understand andCommunicate Successfully With a Multitude
of Individual Customers Every DayMarketers need the technologypower toolsto gather, analyzeand interpret thousands or millions
of data strands of customerinteraction detail from countlesstouch points, channels and datasources cracking the DNA codeof each customerand learningover time to communicate andbuild meaningful relationships
8/11/2019 Teradata Msi Presentation
11/30
2002presentedbyPeterHeffringa
ttheMarketingScienceInstitute
sConferenceon
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tom
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hav
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lCha
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dEconome
tricMode
lson
January
31F
ebruary
1,
2002
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Copyright@2001 Teradata, a division of NCR, All Rights Reserved
Who are my most loyal customersand what promotions are mosteffective?
Do you treat your loyal customersdifferently than your others?
When a customer touches yourbusiness, do you have thecapability to engage them withtargeted messages?
How do you determine the level ofpersonalization you give?
Which of your profitable customersare at risk of leaving?
What are the buying habits of mybest customers?
Are you matching products andservices to the right channels?
Can you detect behavioral eventsand provide timely and relevantcustomer communications?
Customer Relationships & CRM -More Complex Than Ever Before
Who are your most valuablecustomers and what are theirattributes?
What products do my customerspurchase and what do theycrossover purchase?
What will my customers want next?
What product promotions increasedsales, transaction size,
frequency and crossover?
acquireDo you know what constitutes a
good customer?
Are you using customerlifestyle/lifestage data to findprospects?
Can you match customers to theright products and services?
Can you use the above knowledgewith your current prospect lists totarget your marketing efforts?
growthe relationship
rewardloyalty
retaincustomers
Todays marketers have a lot to manage!
8/11/2019 Teradata Msi Presentation
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ttheMarketingScienceInstitute
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2002
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Copyright@2001 Teradata, a division of NCR, All Rights Reserved
The Challenge: Find Patterns, DecodeMessages, Turn It All To Business Advantage
How can a marketer
Make sense of a tidal waveof interaction detail?
Serve and satisfy a millionindividual customers?
Deliver profitable returnson so many relationships?
Help the business meet itsgoals and objectives?
8/11/2019 Teradata Msi Presentation
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2002presentedbyPeterHeffringa
ttheMarketingScienceInstitute
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Copyright@2001 Teradata, a division of NCR, All Rights Reserved
Business Needs & Expectations
Todays executivesmust justify:
Every dollar spent
Every initiative
And must show:
The link betweendollars spent, these
initiatives andreturn on customerrelationships
8/11/2019 Teradata Msi Presentation
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2002presentedbyPeterHeffringa
ttheMarketingScienceInstitute
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1,
2002
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Copyright@2001 Teradata, a division of NCR, All Rights Reserved
45% of companies areconsidering CRM projects1
37% have installations
under way or complete1
CRM budgets are not beingslashed despite sloweconomy2
1Source: Forrester Research, 2001
2Source: Interactive Week, Aug 20, 2001
Capitalize on CRM Technology
8/11/2019 Teradata Msi Presentation
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2002presentedbyPeterHeffringa
ttheMarketingScienceInstitute
sConferenceon
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1,
2002
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Copyright@2001 Teradata, a division of NCR, All Rights Reserved
Analytical CRM Power ToolsCapabilities that Companies Must Have
Broad range of actionableanalysis and predictive
modeling capabilities
Holistic view of customer
interactions to understandthe whole customer
Means to understand and
automate the event rules that
drive the business andcommunicate with
individual customers
8/11/2019 Teradata Msi Presentation
16/30
2002presentedbyPeterHeffringa
ttheMarketingScienceInstitute
sConferenceon
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Copyright@2001 Teradata, a division of NCR, All Rights Reserved
Manage the Total CommunicationsEnvironment with Analytical CRM
Direct
E-Mail/Fax
ATM/Kiosk
Call Center
Agent
Store /Branch
Analytical CRM
8/11/2019 Teradata Msi Presentation
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2002
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Copyright@2001 Teradata, a division of NCR, All Rights Reserved
What is CRM really trying to do?
Tactical cultivation of customer relationshipsbased on strategic vision and objectives
Achieved as a company analyzes and prioritizes opportunities,then communicates with intelligence and relevance to
individual customers in preferred channels
8/11/2019 Teradata Msi Presentation
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Copyright@2001 Teradata, a division of NCR, All Rights Reserved
Insight
Inter-Action
Timely Messages
Disk array
DataWarehouse
Intelligence
Operational CRM Systems
CaptureData
All Channels All Touchpoints
ATMInternetExtranet
E-Mail/Fax
Sales/Store /Branch
DirectMail
KioskAgent/Call
Center
Lead With Analytical CRMFor Mission-Critical Intelligence
ActionAnalytics and Modeling
Personalize Communication
Communication Delivery
Communication Planning
Customer Optimization
Relevant Offers
Timely Messages
8/11/2019 Teradata Msi Presentation
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8/11/2019 Teradata Msi Presentation
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1,
2002
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Copyright@2001 Teradata, a division of NCR, All Rights Reserved
Percentile Analysis
Benefits
Rank and groupcustomers on any keymeasure
Understand relativecustomer differences
based on deciles Actively target
customers directly frocharts & immediatelyinclude them incampaigns
8/11/2019 Teradata Msi Presentation
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8/11/2019 Teradata Msi Presentation
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1,
2002
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Copyright@2001 Teradata, a division of NCR, All Rights Reserved
Pattern Detection
Key Benefits Analyzes datapatterns to offerpredictive insight,e.g. what productsdo customers
typically purchasewith other productsover time?
Extends marketbasket analysis
across purchasesover periods of time
Predicts activityleading up to & aftera significant purchase
8/11/2019 Teradata Msi Presentation
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Copyright@2001 Teradata, a division of NCR, All Rights Reserved
Response Modeling
Benefits
Automatically modelsmost likely respondersfor a communication
Eliminates guessworkby identifyingsignificant variablesthat affect responsebehavior
Actively targetcustomer directly fromcharts
Leverages AnalyticDatasets
8/11/2019 Teradata Msi Presentation
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Copyright@2001 Teradata, a division of NCR, All Rights Reserved
Benefits
Build offer,message, discount,and optimizationrules
Evaluate eachcustomerindividually todetermine the bestcontent to deliver
Capture andautomate
marketing IP. Deliver offers
tailored to eachindividualcustomer.
Personalization Rules
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Copyright@2001 Teradata, a division of NCR, All Rights Reserved
Communication Manager
Benefits Relevant
Communication throughright Channel at rightTime
Flexible campaigndefinition, one-to-oneor mass campaigns
Multi step, multichannel communication
Closed loop
communications
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Copyright@2001 Teradata, a division of NCR, All Rights Reserved
Personalization
6.) Prioritize and
Optimize mix of
communications
deployed to
channels, may
use profitabilityscores
4.) Communication plan
created. Communications
approach and offers
linked to LTV
campaign.
1.) LTV Campaign
model created and
run to calculate
campaign scores
3.) Create
segments
according
to an LTV
campaign
model -propensities
and needs
7.) Communication
Plan handed off
to channel
systems (e.g.
Siebel -
Broadvision)for execution
8.) Action,
Response and
Results
captured and
handed back to
CommunicationManager for
campaign
analysis.
Analysis Modeling
Communication
Optimization Interaction
10.) LTVCampaign
Responses
modeled to
improve
campaign
targeting and
profitability
11.) LTV
Campaign
Results
Available for
Analysis viaOLAP Reporting
by Marketing or
LOB 9.) Costs of LTV
Campaign calculated
based on actual
channel activity
5.) Set personalization
rules to format
communications
appropriately for each
customer.
2.) Model
Customer
Behavior to
identify life
cycle events
Analytical CRM in ActionCustomer Life Time Value Campaign
8/11/2019 Teradata Msi Presentation
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,2002
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Copyright@2001 Teradata, a division of NCR, All Rights Reserved
CRM is an ongoing,scientific processnot an isolated campaign
or marketing plan
Must create a process for
achieving the intended ROI
Note the difference between
database marketing, sales force
automation, and CRM To measure CRM success,
measure the impact of the entire
process
Achieve Positive Business Results Over Time
8/11/2019 Teradata Msi Presentation
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Copyright@2001 Teradata, a division of NCR, All Rights Reserved
570,000 leads, 100 campaigns in 6 mos
$4.4 billion of new business in six months
Retention rates of 98.4%
28.7% increase in profit in six months
Four continents 15 countries
$250 BB Australian in assets
9 million customers
600 home improvement stores
$15 BB annual sales
40,000 products on the shelves
Triple digit ROI on total DW + CRMinvestment after 4 months = 265%
High double-digit campaign responses
Named 2000 NCDM winner for best results
Generated $1 M in one district in one week
6,000 leads in 5 weeks and 40%generated a sale or service opportunity
9 or 10 customer sat on 10pt scale
Largest retail bank in the world
4,500 consumer banking centers
Serving 28 million households
Market leaders taking the first stepshave proven the CRM business case
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Your CRM Process Must Balance
Quality ofCustomerExperiences
Achieve PositiveBusinessResults