Exchange Applications Introduces New Valex Product
The product integrates Exchange's campaign management software with SAS Institute's data mining software, Enterprise Miner. Users can score customer segments by invoking statistical models directly into marketing campaigns.
According to database marketing analysts, Valex 2.1 is one of the first products on the market to offer true integration. "The ability to access the predictive [data mining] models from within Valex is a greater level of integration in many ways than we have seen before," said Henry Morris, director of data warehousing and information access at IDC.
Bob Moran, director of decision-support research at the Aberdeen Group, said that though Exchange is on the crest of the wave in integrating a campaign manager with data mining, "this will be a quickly moving space and other companies will be moving in very soon."
Data mining software analyzes volumes of information in order to predict customer and prospect behavior. Modeling against a complete database of customer and prospect information can be an error-prone process that is time-consuming and, as a result, performed infrequently.
Pat McHugh, vice president of marketing and business development at Exchange said this process -- which is done in most companies every couple of months -- is a particular problem, because the whole issue of data comes down to data freshness. "When using data that is thirty days old, how relevant is it anymore, particularly when predicting things like customer churn or attrition? You need to predict this behavior very rapidly and intervene because that customer has, at least, psychologically disconnected to you."
The new version of Valex improves on this arduous task, he said, because both products have adopted common open-systems standards that allow the company to interoperate the applications from one another.
Companies that are beta testing the system, according to McHugh, "have cycle times of 24 hours and less for predicting customer attrition."
The process will always require human intervention, Moran said, even though this system greatly assists the process. "With data mining, you have to understand the domain you are working in and the tools you are working with," he said. "That [Exchange and SAS have] integrated these tools takes out some of the obnoxious steps that one had to do."
Exchange has reported that several other data mining companies are currently evaluating the technology, such as U.S. West, Denver, a telecommunications firm serving more than 14 million customers.
Dennis DeGregor, vice president, Relationship Marketing for U.S. West, said the integrated solution is already beginning to have a measurable impact on retention and customer profitability. "Model Connect allows us to production-score millions of customer records at the touch of a button and create a one-to-one marketing approach based on the customer's unique attributes, such as lifetime value, potential value, churn score, credit score and geography," he said.
Model Connect is sold as a separate module that is used with the new version of Valex. It facilitates the communication with the SAS Enterprise Miner Server and software. Other new features for Valex 2.1 include multiple ways to view and build campaigns, additional ease-of-use wizards and queries, enhanced profiling of customers and support for additional database and server platforms.
McHugh said Exchange is planning to offer Model Connect capability with a different class of analysis applications shortly.