How advanced analytics is transforming marketing
I live in India, and am one of the 1.2 billion mobile subscribers in this country. We, in India, are quite spoiled for choice when it comes to mobile service providers, mobile handsets, and accessories. Our service providers compete with one another to woo me as a customer, and I know that my current provider does not want to lose my business to a competitor.
I am a marketer by trade. Since I receive so many marketing emails, text messages and even pre-recorded telephone calls from my own mobile service provider as well as the competition, it is only natural that I would be curious about the design of their marketing strategy. Are they cross-selling an offer to me? What new tactic are they employing to retain me as a customer? How strong is the competition’s messaging and offers?
Forbes tells us that retaining an existing customer has a higher ROI than attracting a new prospect. Retention is five times cheaper than acquiring a new customer, and furthermore, profits improve exponentially every time there is an incremental raise in retention rates. It only stands to reason that my mobile service provider treats me as a VIP at all times, since I am such an integral part of their retention approach.
Segmentation, targeting, positioning – how does an organization optimize these strategic approaches in the context of retention? Which factors should the segmentation take into consideration? Consumer demographics? Customer behavior? And which sub-set of present customers should be chosen for this retention marketing tactic? What message should go out to the chosen sub-set, in what format, through which channel, and when?
Good marketing is based on data. As mobile subscribers, we provide tons of data to the marketers at my service provider, with our usage and behavior patterns and history. If you layer on the data provided by external market intelligence, that’s a huge amount of information that marketers need to sift through in order to craft a good segmentation, targeting, and positioning approach. This is where good information management and analytics come into play.
Idea Cellular is a mobile service provider in India. The organization relied on IBM’s Cognos, Db2, Infosphere, and other solutions to help them segment and retain customers in India. Managing and analyzing real-time customer data using information management and analytics, Idea predicted which customer might be considering porting out to a customer, and employed a retention targeting tactic. Immediate quantifiable benefits were seen – reduction of manual activities by 80 percent, decrease in reporting time by seven times, and an increase in revenue by 10 percent with their new campaign management solution. Read the full story here.