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CRM analytics–an array of options

At AAA Auto Club South , Portrait’s analytics are used to target communications to members. The models developed using Portrait allow campaign segmentation so that the appropriate travel, insurance or other services can be promoted to the members. The organization values the timeliness and usability of Portrait’s analytics, compared to alternatives that are slow and hard for non-power users to deal with. Business users are able to modify rules and models in Portrait to quickly adapt to changing circumstances.

An interesting advance in the field of predictive analytics, as well as a key function of Portrait, is to identify and distinguish four segments of customers:

  • persuadables, who will take action specifically as a result of the right marketing message;
  •  sure things, who will act regardless of the message;
  • lost causes, who will not act regardless of the message; and
  • sleeping dogs, who will react adversely to being contacted.

In today’s cost-conscious environment, marketers do not want to waste resources on the sure things, lost causes or sleeping dogs, preferring to focus on those who can be persuaded. An emerging concept called “uplift” isolates those categories and identifies the persuadables. Additional contact optimization analytics may then be applied to ensure that the right channel and right message is used for the individual customer.

Finally, organizations must ensure that the customer experience, across each of those interactions, is connected.  “Today’s customers expect you to know them. You don’t want a customer to call in to accept a relevant offer you’ve made via e-mail and not have the customer service representative be aware of it,” Nicholson explains. “Through Portrait, the rep can pull up a copy of an e-mail offer immediately and proactively follow up during the live interaction.” Those new capabilities can be added to marketing and CRM systems incrementally, without a complete overhaul.

Between CRM and BI

Medallia also provides analytics for CRM systems. Its solutions are designed to leverage the strengths of CRM and BI while overcoming the intrinsic limitations of each. “CRM systems provide good records of customer interactions,” says Borge Hald, CEO of Medallia, “but they are not good at doing intensive calculations. BI cannot handle individual case management well and tends to focus solely on analytics. There’s a next step, and that’s helping companies understand where to take action and improve.”

Medallia unifies customer communications and provides analytic tools for CRM systems that do not have strong analytics built in. “We collect feedback from customers at every touch point,” Hald says, “and flow the information into a Web application that is available throughout the entire organization, including the store level.”

Dashboards present visual information (such as statistics, trends and customer comments) that provides a springboard for discussions at morning meetings, for example. “We do a lot of charting and graphing, and can incorporate the results of text analytics and data mining,” Hald says. When an issue is tracked and resolved in Medallia, the results are communicated back to the CRM system so that call center staff can be made aware of the issue.

Cosmetics retailer Sephora is using Medallia to identify ways of improving its client loyalty index (CLI).  Customer feedback, obtained mainly through customer receipt-based online surveys, is used to develop new opportunities and identify areas of improvement, as well as to measure the success of recent innovations. After implementing Medallia, Sephora increased its customer loyalty percentage and achieved a response rate for surveys that is top in the retail industry.

To do well, companies have to be in touch with their customers, Hald believes, but that is not enough. “Great companies have to be great at the core,” he emphasizes. “They have to deliver good products and good service. If they don’t do that, all the social media outreach in the world won’t do any good.” The best bet is to combine both a solid product and a tuned-in relationship with customers.

Comprehensive BI for CRM

Another option is a BI solution that analyzes data in the CRM system but also has broader uses. This was the route that Hallmark chose to provide analytical capabilities to the research group that supports marketing and product development. Hallmark was already a user of BI software from SAS, and a few years ago, deployed SAS BI Server in its Consumer Understanding and Insight group.

Hallmark has a wealth of information derived from its loyalty program for the Hallmark Gold Crown stores, but it was really only accessible to a few power users. Information was being extracted from a data warehouse, but the process was inefficient and did not provide the sophisticated analyses that Hallmark wanted in a timely manner.

“We have over 12 million consumers in the loyalty program and we receive point-of-sale data every night,” says Jay Dittmann, VP for marketing strategy at Hallmark. “Analyses based on this data can provide us with a clear competitive advantage and a way to more effectively target our marketing efforts to better meet consumer needs.”

After deploying SAS BI Server, Hallmark was able to carry out analyses that were much more refined and informative than previously. “Now we can target our direct mail, e-mail and other outbound marketing efforts more precisely,” Dittmann says. “For example, we can easily segment consumers into targeted groups and focus loyalty communication by factors such as products purchased, seasonal shopping patterns or geographic region.” 

One advantage of having a comprehensive BI solution is that analyses can be done across databases outside the CRM system. “We have data sources such as consumer panels and retail information that allow us to take a broader look at the overall marketplace,” Dittmann explains. “This capability lets us provide some external context for analyses across all of our customers.”


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