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Want Tangible ROI? Establish anEfficient Customer Intelligence
Eco-system
Leslie AmentManaging Partner, Hypatia Research & Consulting LLC
www.HypatiaResearch.com
CRMA National Conference 2008August 25-27
Atlanta, Georgia
Agenda
Customer Intelligence Research & About Hypatia
Why CI and not BI?
Research Findings & Methodology
Customer Intelligence Delivers High Value
Customer Management & Business Intelligence: Teradata Customer Management & Business Intelligence: Teradata
Customer Data Quality & Address Verification: Experian/QAS
On-Demand Customer Management: Salesforce.com
Customer Data Integration & Management: Dun & Bradstreet
Summary
Q & A
About Hypatia Research, LLCAccelerating Performance by Calculating ResultsTM
Our Team: Ten senior analysts perform research onall aspects of customer information management thatbusinesses leverage for customer insight & decisionsupport in regards to:
Market intelligence Vendor selection Operational improvements Industry best practices Benchmarks
Who: Leslie Ament, Industry Analyst, and ManagingPartner, Hypatia Research, LLC focuses on CustomerIntelligence Management Processes and enablingtechnologies such as: CRM, Marketing Automation,Customer Data Management, Analytics & BusinessIntelligence.
What: Participated in the selection, business processmanagement, customization criteria and projectmanagement of various customer management solutions Benchmarks
We focus on the internal processes, service providersand enabling technologies organizations deploy inorder to leverage this intelligence--and we benchmarkindustry performance.
Expertise: Our coverage areas include: CRM,Business Intelligence, Web Analytics, MarketingAutomation, Database Marketing, and Customer DataIntegration & Quality.
Results: In short, we investigate and assess return oninvestment for how customer insight and informationis managed, analyzed and applied by businesses rangingfrom SMB's [<$50M] to billion dollar enterprises.
management of various customer management solutionsfor numerous organizations.
Where: Industry expertise encompasses ConsumerHealthcare Products, Retail, Media, Professional Services,Supply & Demand Chain Analytics & Content Managementsoftware companies.
How:Practice Leader & Research DirectorCustomer Intelligence, Harte-HanksArthur D. Little Management ConsultingOracle: Demantra, Inc.Banta CorporationInternationalThomson PublishingCarnegie Hall
Who Was Hypatia?
Hypatia of Alexandria (c. 370-415AD),invented several scientific devices--theastrolabe, plane sphere, and hydroscope(hydrometer).
These instruments were used to measure& calculate the distance between
Like our namesake, Hypatia, we are committed toCalculating ResultsTM for our clients.
& calculate the distance betweenplanets, the position of visible stars at anytime of the year, and the gravity of liquidsrespectively.
Hypatia was the first woman to makesubstantial contributions to thedevelopment of mathematics, astronomy& philosophy.
Customer Intelligence ResearchServices:
Why CI and not Only BI▲
?
"Customer Intelligence Management is defined as theprocess of capturing, managing, analyzing and
applying customer information to enhanceperformance and to accelerate growth."
applying customer information to enhanceperformance and to accelerate growth."
--Hypatia Research, LLC.
▲BI is a subset of CI that provides operational decision support, data/text mining and
predictive analytics.
©2008 Hypatia Research, LLC
Business Valuation ResearchMethodology Surveyed and benchmarked >800 enterprises
74% of Top Performers focus on CI as a strategic initiative: Creating a culture of customer-centricity
Understand & respond to high value customers
>15% Y/Y performance improvement in key metrics >15% Y/Y performance improvement in key metrics
Annual increase in revenues
Reduction in operational costs / ROMI
Increase in customer retention / acquisition rates
Case Studies: In each of these categories: Capture Customer Data
Manage Customer Data
Analyze Customer Data
Apply Customer Intelligence
Integration, Sophistication & SpeedExpands Performance
Multi ChannelOptimized
Rules-basedCampaignExecution
Top Performers51%
Return onMarketingInvestment
CustomerRetentionRate
76% 49%
CustomerAcquisitionRate
{CRM + Data Integration/Quality + BI} x CI = >ROI
Percent of Companies Reporting>15% Y/Y Improvement inPerformance [>600 enterprises]
Spread-sheets &Data-marts
CRM/SFA BusinessIntelligence
Real-timeIntegration
Mass MarketMass Customize
Target MarketSegmentation
Micro-MarketingChannel Optimized
Front/BackIntegration
Industry Norm
Lagging
Technology Enablers
36% 60% 45%
37% 45% 39%
Use of Customer IntelligenceDelivers Tangible Value
Annual increase in revenues
Increase in share of wallet captured
Cycle-time reductions: product enhancement / Cycle-time reductions: product enhancement /innovation
Improvement in customer retention / acquisitionrates
Reduction in operational costs
Improvements in customer profitability
CRMA Speaker Abstract
John Timmerman
Global Marketing Director
Teradata Corporation
Customer Management Solutions
Who is John Timmerman?
• John Timmerman, Global Marketing Director, TeradataCorporation (803-361-6303, [email protected]):
Primarily responsible for marketing Teradata CustomerManagement Solutions to the global markets where Teradataoperates. Which means:
> I’m involved in strategy development.
> I’m involved in competitive analysis.
11 > 9/5/2008
> I’m involved in competitive analysis.
> I’m involved in new product development.
> I’m involved in the creation of sales materials for thesolutions that we sell (brochures, presentations, whitepapers, demonstrations).
> I do a lot of sales training, product webinars, trade showsand customer consulting engagements.
> I spend a lot of time on an airplane.
Who is Teradata?
• Teradata Corporation (NYSE: TDC) is the global leader in datawarehousing and analytic technologies that make smartcompanies smarter.
• Teradata provides the most knowledgeable and experiencedconsulting professionals, highest performing technology,industry-leading innovation, and a world-class network of
12 > 9/5/2008
industry-leading innovation, and a world-class network ofcustomers and partners to make faster, smarter decisions thatgive our customers a decided competitive advantage.
Teradata Customer Management Solutions“Offers and Products”
• Customer database, data-mart, data-warehouse
• Customer Analysis
• Campaign Management
• Event-based Marketing
13 > 9/5/2008
• Offer Management
• Inbound Marketing
• e-Marketing (email and Web)
• Mobile Marketing
• Marketing Resource Management
Teradata Customer Management Solutions:Reference Examples
• European Retail Banker: Extending customer insightwith risk data> Leveraging profitability data to provide better service to
high-value customers> Improved cross channel utilization> Over 600 campaigns per year> Over 1 million ongoing campaign offers at any moment
14 > 9/5/2008
• International Financial Services Firm: Customer LifecycleManagement and Event Based Marketing> Needed to deploy enterprise customer lifecycle
management processes and customer insight to Credit Cardbusiness unit.
> Greater than $17 million in profit attributed to betteracquisition insight, improved strategies for managingextended credit lines.
> Delinquency tracking process efficiency savings of over $7million.
CRMA Conference Presentation
Chris Williams, Vice President, Client and Technical Services
© Experian Limited 2008. All rights reserved. Experian and the marks used herein are service marks or registered trademarks of Experian Limited.Other product and company names mentioned herein may be the trademarks of their respective owners. No part of this copyrighted workmay be reproduced, modified, or distributed in any form or manner without the prior written permission of Experian Limited.Confidential and proprietary.
Chris Williams – VP, Client and Technical Services
Current ResponsibilitiesQAS Technical Operations, ProductManagement, Sales School
Additional / Previous Experian BackgroundJoined QAS in Jan 2004 as Technical ManagerFall 2004 assumed leadership of CustomerManagement
© Experian Limited 2008. All rights reserved.Confidential and proprietary. 16
ManagementFall 2005 assumed leadership of ProductManagementSpring 2006 Launched billable professionalservices operationSpring 2007 assumed leadership of SalesSchool
About Experian QAS
Customer data quality software and services provider
Experian QAS products capture, validate, cleanse, standardize and enrich customer contactinformation
Address
Name
Piloting email and phone number product
An Experian company – Acquired QAS in 2004
$1.3B information, analytical and marketing services company
© Experian Limited 2008. All rights reserved.Confidential and proprietary. 17
$1.3B information, analytical and marketing services company
London Stock Exchange: EXPN
QAS Group – Founded in UK 1990
$131M in revenue in FY2008
500 employees in 7 countries
11,000 customers worldwide
QAS - North America – First US office in 2001
$17.6M in revenue in FY2008
More than 100 employees
More than 1,300 customers
Experian QAS Solutions
Point-of-entry validation, cleansing andstandardization of important contact informationsuch as name and address.
Point-of-entry address validation on web sitesand intranets.
QAS Pro
QAS Pro Web
QAS Names Verifies a person at an address and spell theirname correctly on entry.
© Experian Limited 2008. All rights reserved.Confidential and proprietary. 18
Back-end CASS certified batch engine forcleansing, completing and verifyingaddresses in existing databases.
De-duplication and list suppression tool.
QAS ProfessionalServices
Training, deployment, consulting and bureauservices.
QAS Batch
name correctly on entry.
Health System Use Case
Data errorsoriginating in patientaccess werepropagatingdownstream
Viewed ExperianQAS as anopportunity to makesure we were gettingvalid addresses from
Problem Experian QAS Solution Results
Bills received bypeople who willpay them
Improved clinical
© Experian Limited 2008. All rights reserved.Confidential and proprietary. 19
propagatingdownstream
Leaving money onthe table
Patient access wasnot always able toimmediately contactpatients with testresults, follow-up
sure we were gettingvalid addresses fromthe start
Rolled out across allcampusesincrementally
Trained keyemployees
Improved clinicalcorrespondence
Based on earlyestimates, ROIon Experian QASpurchase pointwas achievedafter 60-90 daysof deployment
Finance Use Case
Many incorrectaddresses whereentered into thecompany's system
Company added QASPro and QAS Pro Webto all point-of-entrylocations
Problem Experian QAS Solution Results
Company was ableto reduce incorrectaddresses from 20percent to less
© Experian Limited 2008. All rights reserved.Confidential and proprietary. 20
company's systemcausing productivityproblems
Bad addresses wheredamaging customerretention
Extra labor, postage,and printing costsrelated to incorrectaddresses topped$80,000 annually
locations
QAS Pro workedwithin the company’smainframe so nochanges where madeto there businessprocesses or systems
High adoption rate bystaff
percent to lessthan 3 percent
Employees savedtime andproductivity wasboosted
Enhanced
customer service
Peter CoffeeDirector, Competitive
Intelligencesalesforce.com
Former: Technology Editor, eWEEK & PC Week
Current: Building enterprise/entrepreneurialcommunity on the Force.com PaaS
Contact: [email protected]
What we do @ salesforce.com
- Propel customer success with Software as a Service
Customer and partner relationship management
Sales force automation
Community creation with Content and Ideas
- Enable innovative developers with Platform as a Service
Key to this conversation: integration
Mash-ups fromAppExchange
NativeDesktop
Connectors
IntegrationPartner
Ecosystem
DeveloperToolkits
NativeERP
Connectors
• Intelligence ecosystems exemplify Metcalfe’s Law: valueproportional to the square of the number of complementaryinformation resources
• A service need not be a silo: explore and evaluate integrationoptions
Ecosystems arise from legacy leverage
4 Months(Oct ’06- Feb ’07)
1 Month
Deployments
“This is process lite. It gives my business users what they want,a unique app for each sales team, fundamentally reflectingtheir own personality.”
– Fortune Global 500 CIO
SalesDistributor
s
SalesDistributor
s
EMEAEMEA
“The Cloud”
Applicationson PaaS
1 Month(Dec ’06)
5 Months(Dec ’06 – May ’07)
2Q07Legacy Back End
EMEAInsideSales
EMEAInsideSales
AFS GlobalSales
AFS GlobalSales
FLPR FieldSales
FLPR FieldSales
Operations in 27 countries on 5 continents
High staff turnover impaired historical data collection
Kelly Financial Resources, Kelly Engineering Resources, and Kelly
Law Registry standardized on common SaaS foundationLaw Registry standardized on common SaaS foundation
Operational benefits
– Anytime/anywhere access
– Opportunities tied to parent accounts
– Full sales history documented on every account despite turnover
– Multi-language, multi-currency capabilities provided by Force.com
platform
•Immediate deploymentto 900 stores
•Four new custom-builtfranchise managementfranchise managementapplications delivered infour months
•No increased burden onIT
“Benefits of Establishing a Successful CustomerIntelligence Ecosystem”
CRMA National Conference Customer Intelligence Panel
Catherine PedersenDirector, Product MarketingPurisma/Dun & Bradstreet
Copyright (c) 2008 D&B. All rights reserved. These materials are provided by D&B as a service to its customers and may not becopied or distributed without express permission from D&B.
Catherine Pedersen is the Directorof Product Marketing for Purisma - aD&B company focused on helpingcompanies use customer insight todrive revenue.
Before this Catherine worked at
Introduce Myself
Before this Catherine worked atBusiness Objects and for severalyears consulted with the CorporateRelationship Marketing group atMicrosoft.
Previously her focus was CustomerRelationship Marketing anddatabase analytics for Banking andInvestment Management firms.
Offerings/Products
Dun & Bradstreet is the world’sleading source of commercialinformation and insight enablingcustomers to Decide with Confidencefor over 166 years.
The Purisma Data Hub™ from D&B isThe Purisma Data Hub™ from D&B isa Master Data Management (MDM)solution for enterprises looking torapidly solve data quality andintegration problems in response tospecific business initiatives.
The Purisma Data Hub creates anaccurate, master version of everyidentified entity, flexibly organizes allidentities into hierarchies tailored foreach business user, and synchronizesthis information across the enterprise.
Marketers Own the Customer Management Agenda
• Marketers should team with internal ITand vendor partners to architectcustomer information for competitiveadvantage.
• How do you do this?
Customer Information Integration Customer Information Integration
Customer Insights
Insights Operationalization
• Use the Customer Management MaturityModel at the end of my presentation toassess your current capabilities and set avision for the future of your organization. Start where you are and
drive improvedcapabilities!
“Increase sales & customer satisfaction and decrease costsby accelerating the discovery and display of customer
information”Company
• Global supplier of business products and services,with approx $5b in sales in North America. Operatingfrom more than 350 locations in 21 countries.
• Largest contract stationer without a retail presence.One-stop shopping on the web with next day delivery.
Customer Intelligence Case Study #1
• Largest contract stationer without a retail presence.One-stop shopping on the web with next day delivery.Over $6 million orders/day & 300 order lines/minute.
Benefits Realized
• Increased sales from targeted product placementbased on customer behavior and historical buyingpractices and tailored marketing promotions forindividual accounts and customers.
• Increased customer satisfaction from improved, morepersonalized customer service and easier web check-out.
• Saving $500,000 for every 30 seconds eliminated fromsearch activities by Customer Advisors and $1.3million by eliminating order line entries.
Customer Intelligence Case Study #2
Company
• One of the largest distributors ofpharmaceuticals and medical supplies.
• The company develops market-leading
“Transition from a distribution company to a more customer-focused Fortune 20 company making healthcare safer and moreproductive.”
• The company develops market-leadingtechnologies and distributes approx 1/3 ofpharmaceuticals prescribed in the US andproducts used in 50% of all surgeries.
Benefits Realized
• Combined seven acquired companies intotwo lines of business.
• Well defined customer data ownership.
• Increased demand for customer intelligenceand funding for “MDM” services.
• Manual data clean up • Periodic batch processes toclean up data
• Online search, lookup, validationrules applied at appropriate tiers
• Data quality maintenance usingvendors or periodic data feeds
• No 360˚ view of customer • Common IDs established for360° view loosely coupled
• Automated integration of IDs for360° view delivered via batchCDI
• Central system for IDmanagement via real time CDI
• Customer changes posted • Changes posted weekly • Changes posted daily • Changes posted immediately
Customer Management Maturity Model Start where you are and drive improved capabilities
CustomerInformationIntegration
Basic Foundational Advanced Distinctive
Set a vision for the future of your organization!
• Customer changes postedend-of-month
• Changes posted weekly • Changes posted daily • Changes posted immediately
• No cross departmental datastewardship
• Data steward FTE • Data stewardship change controlboard
• Business subject area ownersenforce data policies
• Market/demographicsegmentation only
• Behavioral segmentation • Needs-based segmentation • Micro and multi-level needssegmentation
• Revenue-driven customervaluation
• Profit and/or proxy-basedcustomer valuation
• Share of wallet analysis • Unrealized value analysis
• No use of predictive models • Some proxy-based predictivemodel usage
• Segment or statistically basedpredictive models
• Complex predictive models forpropensity scoring
• Ad-hoc measurement ofmarketing initiatives
• Campaign effectivenessevaluated at aggregate level
• All direct marketing efforts in allchannels evaluated
• All marketing expendituresevaluated for ROI
• Same service levels for allcustomers
• Differentiated service forvaluable customers
• Differentiated service bycustomer segment
• Personalized service
• No integration to front-officeapplications
• No production process to updateinsights
• Insights updated throughperiodic batch processes
• Real-time, rules-driven customerinteractions
• Manual processes for problemresolution
• Case management for problemresolution
• Automated case hand-off andtracking
• Enriched knowledge base forself-service fulfillment
• No lead management system • Leads manually distributed tochannels
• Leads automatically generatedand distributed
• Automated lead generation andtracking system
Customer InsightsOperationalization
Customer Insights:Segmentation &Modeling
Q & A Name 2-3 challenges most often faced by your clients in attempting to
create an efficient CI eco-system?
What percentage of your clients utilize SaaS versus on-premise/enterprise CRM or BI software for customer managementand analysis?
How long does it typically take your clients to:
Research Contact;
Leslie Ament
M: 617-230-0067
O: 781-861-9135
[email protected] How long does it typically take your clients to:
Select a vendor or solution provider?
Create a project / implementation plan?
Deploy an application / solution?
Attain tangible ROI or break-even?
What percent of your clients take a phased approach versus acomprehensive deployment? [all at once]
CRMA Attendees: How should we define Customer IntelligenceEcosystem?
Business Contact;
Zvi Ruder, PhD.
O: 781-861-9135
www.HypatiaResearch.com
