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DATA ANALYSIS -
DEVELOPING CUSTOMER INSIGHT
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for geographic mapping
Key to building and maintaining a
relationship with your customers is the need to record and analyse all
information that stems from that business relationship.
Assuming the first hurdle of bringing
all relevant data together into a single customer view has been undertaken, then
the next step is to correctly analyse your data, interpret the results and apply
your findings (the insight) to develop more appropriate and more highly targeted data-driven
marketing strategies. These will deliver a host of benefits to your business
including a greater return on marketing ROI and a
substantial increase in profitability.
Customer insight will also keep your
business on its planned course and help spot reasons for any deviation.
Changes in customer behaviour can
often signify deeper business reasons for the change - a new website, new
competition, different suppliers, customer service issues, etc. - and provided
indicators are set to record key events, then the knowledge gleaned from
in-depth customer analysis will help you keep your marketing and your business
on the right track.
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SO,
WHY ANALYSE YOUR DATA?
A marketing database would usually
contain records of all your customers together with all of the transactions they
have made with your organisation over time. This highly valuable resource would
typically be enhanced with marketing, profile, survey, suppression and prospect
data to provide you with the deepest customer understanding possible. However,
left incomplete your customer vision will be blurred!
The
saying that 'the whole is greater than the sum of the parts' is never truer than
in database marketing, as when viewed in its entirety, this information will
help to maximise the potential of your business and uncover otherwise hidden
sales opportunities that will drive increased profitability. By using data mining and
statistical analysis, you will be able to: |
Is this how you see your customers? |
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Improve your understanding of the real value and
profitability of your customers,
how it changes and why
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Segment your customers using their
trading history to maximise cross-sell and up-sell opportunities
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Identify the most responsive prospect
lists and best customers to target
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Increase retention - spot the factors that predict churn
and then develop a corrective retention strategy
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Spot changes in customer
behaviour to drive 'adaptive' campaign targeting
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Plan more appropriate communication
strategies, with selective messaging to strengthen customer loyalty
However, customer analytics is not
just a one-off exercise. To reap the rewards, data analysis needs to be carried
out on an on-going basis to keep track of change and allow you to take the
appropriate action on a timely and a proactive basis. But to analyse your data effectively
and reap the rewards, you need complete and reliable data, the right know-how and
some easy-to-use data interrogation tools.
Plus - and perhaps this is the most
important part - you need to first define some SMART marketing objectives.
SMART stands for - specific, measurable, achievable, realistic and time-bound.
For instance, first
create a customer development road map such as...
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Recruit (acquire / win) 'X' new
customers within 'Y' months with an average order value
of 'Z' for 'ABC' products or services
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Improve retention of high-value
customers by 'Y' % over the next 'Z' months
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Increase average order value by
'Z' %, margin by 'Y' % and average order frequency by 'X' %
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Reactivate 'X' inactive / lapsed
high-value customers at a rate of 'Z' per month
... and then develop
for each of these an appropriate segmentation scheme coupled with offers
that you can establish and test by studying past purchase and behaviour
patterns.
Click here to see the benefits customer
insight will deliver...
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