The next big thing: Advanced marketing analytics
Executives have heard the following phrase countless times: Marketing needs to get more analytical. The strategies, processes and technologies used to identify, acquire, and retain loyal customers are changing. Companies struggle to find out what makes their customers tick while budget constraints make finding the best customers and prospects more difficult. Add in the unprecedented volume of messages across every conceivable channel, and the world of marketing becomes a very difficult place.
This is where advanced marketing analytics can be used. Analytics turn data into action by targeting the right individual with the right offer or promotion with the right message. Analytics is no longer a “nice to have” tool, but a “need to have,” integrated component of a marketer's overall execution platform. The dynamics of the marketplace demand an analytic platform that is truly integrated with the entire marketing process and continually updated to assure relevance.
Today, marketers require advanced insight into customer and prospect behavior well before creative is completed or the marketing program is put into action. In the past, models were used to predict such behavior, but today's marketers need to know more. The idea of developing a model for a campaign or program simply can't work in the current environment.
Even in a simple model with only a few services in, for example, telecommunications, a cellular provider would need nearly a hundred models to provide truly advanced knowledge about a customer's expected behavior across half a dozen service plans.
Statistics is no longer a means to an end for increased lift. It is now the mechanism by which marketers must discern or uncover advanced knowledge about a customer's behavior, and, most importantly, be able to use this knowledge in all marketing and sales activities.
Armed with this knowledge, the marketer can better manage the entire marketing lifecycle, from planning to measurement. For example, in one firm we have worked with, the marketing plans for the year are based on the expected results (driven by advanced analytics). The firm's marketing executives can contemplate shifts in marketing spend across programs and have a very real sense of the expected lift and return on these dollars.
A proper platform must be put in place to handle the entire analytical modeling process. It needs to fully support all analytical model development, scoring, accuracy checking, performance verification, and integration with the marketer's toolset, campaign, measurement, ad-hoc and reporting platforms. Furthermore, the analytical capability and integration must be automated, saving the modeler time and letting the advanced analytic resource focus on providing value.
One of the most common best practices using advanced analytics is the redistribution of contacts from one customer group/segment to another early in the planning process. With an integrated analytics platform, marketers can view future contact plans in light of expected response and returns, and redistribute marketing dollars (and contacts) on all outbound channels to address their strategic needs. During the execution stages of each program, the marketer can evaluate real results against expected results and further reallocate contacts while programs are in market.
By leveraging the advanced analytical platform, marketers can optimize offers on inbound channels like customer service and inbound sales.