Customer Data Demands Specialized Solutions

Everyone is clamoring for database marketing solutions to their needs. Like the industry can anticipate each organization's needs and system uniqueness. Ha.

As the demand for customer information skyrockets throughout most organizations, the database marketing industry is facing steep challenges. “Use customer relationship management strategies to build customer loyalty and a profit center,” is the usual cry. CRM is being widely used, but mostly in its most common form, which is simply a scheme on segmenting and targeting the most profitable customers.

Most companies today want to distribute customer information to all the enterprise-wide users of data, fulfill a broader scope of customer needs, and increase customer service efficiencies while meeting the

expectations of lower operational and marketing costs. Unfortunately, most of today's database marketing tools are not well suited for any of these purposes. So, until the right tools come along, and become as common as your favorite electronic spread sheet, you will have to gain experience by organizing your own strategies.

As organizations focus more of their planning and operational processes on CRM, the need for customer information (not implied from cluster-coded data) increases significantly. Enterprise data users demand faster access to a vast array of databases and customer analytical applications such as those that identify cross-selling opportunities.

From our experience, the industry needs a new generation of integrated customer data management solutions that provide a more holistic approach.

Need for a customer information architecture. In order to meet the future requirements of CRM, organizations need improved availability and access to customer information. Establishing business rules will go a long way toward integrating the existing silos of information into a commonly used customer database.

Customer knowledge. The centerpiece of customer information is a customer data repository, where the fragments of customer data can be assembled and enhanced into a valuable business asset. This must include all elements of a customer's interaction with the company as well as appended secondary data.

Analysis. Applications that identify cross-selling opportunities, profitability analysis, RFM, customer retention and campaign management provide the targeted view most often needed to identify profitable segments for selling.

Action. The organization must be capable of responding to the information generated. Empowered employees who come in contact with the customer must be able to immediately identify the status of the customer and/or prospect and take action to enhance their relationship or correct a problem. Systems must be in place to grow a customer-centric environment, which means exchanging information with the enterprise as to the specific customer interaction and remedy.

Customer data repository. The customer data repository, much like a data mart, is a silo of data which is part of the data warehouse but is a separate repository that is the foundation for customer information management. Summary data can be stored as Meta data in the data warehouse.

Cleansing intensive. Keeping data clean and current is critical to a successful CRM program. This also involves general data transformation, normalization of data structures and the critical aspects of keeping data current to the customer location address and contact point.

Sophisticated matching and consolidation. Additional processing must be performed to identify unique customers and households. The consolidation process often involves “fuzzy” machine capabilities to compensate for lack of direct and self-described information. Unmatched results must have another process that is not limited to machines and can be done by hand matching where an important customer is at risk.

Increased scale and performance. As the CDR becomes larger and includes more elements to be identified, the need for scalability increases. It is not uncommon for the CDR to provide services to support the needs of analytical systems as well as customer interaction systems, such as a call center application, Internet database or marketing system analysts.

Most system applications won't meet the future needs. If you are certain that you have the right solution that will take you into the next millennium and that you and your customer-centric operations system is perfect, then you are blessed. However, the reality is that the current systems are not capable of keeping up with the users' growing demands and expectations.

It's true that while most people in an enterprise fear new system changes, they hardly get used to the old system before there is an upgrade or another system to get used to. Generally, this is because a system features overly simple technology.

Specialized users need special requirements. The users who are most likely to adapt to new technology and move the company forward need these tools. However, the core CDR needs to have a fundamental structure that can deliver information to all users over the next few years. Information areas must include name, addresses, method of contact, status in the organization, the last experience the customer had with the company and product use.

It is important to develop a whole, multi-dimensional view of the customer. This means synchronizing all the various analytical and actual views of a customer in order to make it easier to deliver relevant and timely information to them.

Robert McKim is CEO of MS Database Marketing, Los Angeles.

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