DM News Essential Guide: Customer-Driven Marketing Ensures Relevance, Timeliness and Significance
It's time companies change how they contact customers. There is no longer any excuse for sending impersonal, irrelevant, insignificant and untimely marketing offers and messages. Technology exists to engage customers in dialogues that are relevant, timely and significant.
Instead of relying heavily on push messages to customer segments, the most effective way to do marketing is to let customers initiate contact by using sophisticated event triggers for multistep, multichannel dialogues. This is what customer-driven marketing is about: The individual customer drives the initial business contact by signaling a "present moment" interest in a company's products or services based on an event trigger.
Companies already on the road to doing customer-driven marketing are realizing enormous financial rewards and retaining customers better than their competitors. They report great response rates and phenomenal return on the technology to enable the new marketing. Others doing successful event-triggered marketing are keeping quiet.
The most dramatic results are being achieved through customer-driven marketing by companies like Verizon Wireless, Fubon Financial Holding Co. Ltd., National Australia Bank (a legend in event-triggered communications), Westpac Bank, LG Telecom (100,000 new customers in third-quarter 2005, plus profit up 90 percent) and, more recently, Chinatrust Commercial Bank - all Teradata clients who are doing advanced, multistep, customer-initiated dialogue using sophisticated event triggers. In fact, Fubon reported an 850 percent ROI from its total data warehouse and CRM investment in less than two years.
In our experience with clients, one good event trigger literally can be worth 10 targeted push campaigns. As the accompanying chart illustrates, we've learned that more sophisticated event-triggered communications drive higher customer responses, higher return on technology investment and higher return on the relationship.
The customer-driven payoff is realized in terms of relevance, timeliness and significance. Relevance refers to the capability to analyze customer data from across all business lines and channels to generate and prioritize targeted value propositions. Timeliness comes from the ability to provide fresh data from a real-time data warehouse to make decisions and act in the moment when customer behavior signals an immediate opportunity. Finally, integrated analytics and operational capabilities create individual customer insights that heighten personalization. This drives intense significance into offers that differentiates them from competing offers.
Customer-driven marketing is enabled by specific CRM technology applications that leverage automated, rules-driven event triggers with analytical CRM tools to identify which messages and offers are most relevant and most likely to generate a customer response. They include contact-limiting rules, offer optimization rules and multistep rules scientifically tuned to activate when a customer first triggers the dialogue directly or indirectly, such as:
• Changes in a customer's routine banking or interaction behavior, credit card applications, deposits or transactions.
• Calls or contact from a customer about products, services or need for information.
• In the travel business, sudden changes to flight schedules that affect customers' patterns in travel booking that signal opportunities to alter arrangements.
• For telecommunications, patterns of service disruptions or changes in telephone activity or billing amounts that may signal a need to upgrade or modify service agreements or offer other services.
• Name changes, address changes, date-driven or apparent lifestyle changes.
• Product or service purchases that may trigger complementary items, services, upgrades or upsell offers or achieving predetermined customer status.
When your marketing team can continually identify those event-based opportunities that hold the greatest long-term value potential, your finite resources can be focused on these opportunities, thus improving your return on marketing.
With event triggers, your customers contact you when they have a need. Best of all, you can be ready whenever and wherever prospects or customers touch your business with something relevant, timely and significant to talk about.