Surgical skills for marketers
The Harvard Business Review reports that increasing customer retention rate by 5% can result in a 25% to 95% increase in profitability, so it’s no surprise that identifying customer behavior is critical to enterprise success. It’s very common, however, for a marketer to break out only five to ten segments from a customer base of millions of people, says Ithena President Charles Nicholls.
Ithena, a wholly owned and funded spin-off of Business Objects, has developed e-CI, an application that Nicholls says enables companies to maximize the value that they can generate out of each customer.
Nicholls says that while many organizations have very large data warehouses, in many cases they can’t exploit all that information. If, for example, a company has 10 million customers in the data warehouse and they are all making transactions daily, it very hard to identify and track what could be very significant details at the individual level.
One approach to gathering information would be to use data mining tools. However, says Nicholls, going that route requires highly skilled statisticians or analysts. Further, he says, the solution requires model building, and the lead time is measured in weeks, if not months.
“Alternatively,” says Nicholls, “e-CI tracks customer behavior automatically on a daily basis, thus enabling you to leverage the information already in the data warehouse and to react and automate actions based on very fine-grain changes in the data.” The application allows communication to be automatically triggered across all sales and marketing channels and a variety of customer-facing systems including call centers, campaign management and personalization engines.
He explains, “We’re able to track patterns--changes in loyalty, average order or whatever customer behavior you want to analyze--and automate actions in a series of both the back and front office systems based on that behavior.”
Ithena’s goal is to allow its clients to treat their customers differently according to their value and then roll that back across the organization. “High-value customers should receive special treatment,” Nicholls believes. “You may want to push them to the front of the line for high-demand products or not charge them for priority shipping. In the credit card business, it might mean raising a credit line when you see balances being paid off more quickly or any number of different incentives. Or, if you determine there has been no activity on a card for a certain period of time, the information would be automatically sent to a call center for follow-through.” The possibilities are limited only by a company’s business rules.
Ithena targets “three and a half” vertical markets, says Nicholls, including financial services, including credit cards and retail banking, telecoms and retail. The half is high-end e-commerce.” Amazon.com is Ithena’s key design customer.
Ithena’s e-CI is available now at a base price of $350,000 per application.
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