whole-brained marketing -- blending data science with creativity & action

Data-Driven Marketingaka. Whole-Brained Marketing

Microsoft Center, Cambridge MA

Presented By: Aileen Cahill@AileenCahill

#WholeBrainMktg

September 30, 2014

2The New England Consulting Group

Marketing

Art Science

Vs.


Marketing Transformation

OBJECTIVE PRODUCT SALES CULTIVATING CUSTOMERS

BUSINESS MODEL

Have Product Find Customer Have Customer Fulfill Needs, Engagement

METRIC Dollar Sales, Transactions Customer Lifetime Value and Customer Equity

COMMUNICATION

Unidirectional Mass Media Two-way Personalized Dialog

TITLES Chief Marketing Officer

Product Manager Chief Customer Officer

Key Account Managers: ‘T’ Capabilities and Portfolio Responsibilities

OFFERING Standard Tailored and Customized

R&D Functional Silo Customers as Collaborative Developers

SALES Setting Appointments, Qualifying Leads, and Educating Prospects

Closing Deals with Self-Qualified, Pre-Educated Prospects

MARKETING Outbound Inbound, Go-To-Market, Communication Essentials

CUSTOMERS What Have You Done For Me

Lately? Loyal Partners, Evangelists, Erecting Their

Own Barriers to Exit

Then Now


AGILE Marketing Will be THE Hallmark of Winners!

1. Collect & Integrat

e

2. Analyze & Discover

3. Act & Optimize

4. Execute

& Deliver

SPEEDPROCES

SMETRICS

DATA to Understand Customers/Consumers

• Manage Data• Rich Content• Contextual Relevance• Strategic Intent• Omnichannel Touchpoints

• Orchestrated Customer Experience• Continuous Improvement• Refine• Benchmarking• MEASUREMENT

Critical Success Factors• Rapid Cycle Learning• CMO & CIO Partnership

Marketing (R)Evolution

<1990

1990s

EventsDirect FaxDirect MailTelephone

19992000

s2013

TVRadioPrint

Display

IMEmailEvents

Direct FaxDirect MailTelephone

TVRadioPrint

DisplayCable TVWebsiteSearch

Online Display

IMEmail

Events Direct FaxDirect MailTelephone

TVRadioPrint

DisplayWebsiteSearch

Online DisplayPaid Search

Landing PagesMicrosites

Online VideoWebinars

Affiliate Marketing

Mobile EmailSMSIM

EmailEvents


TVRadioPrint




Online VideoAffiliate Marketing

WebinarsBlogsRSS

PodcastsContextual

WikisSocial Networks

Mobile Web

SnapChat/PokeApps/Push Notifications

Group TextingSocial DM

Voice MarketingMobile EmailSMS + MMS

IM EventsEmail


TVRadioPrint




Online VideoAffiliate Marketing

WebinarsBlogs/ RSSPodcasts

Contextual Wikis

Social NetworksMobile WebBehavioral

Social Media & AdsVirtual Worlds

WidgetsTwitter

Mobile AppsGeolocation

Pinterest 5


Data is an Asset! Mine It For Competitive Advantage

Systematic Use of Information

• Customer Data Warehouse

• Data analysis and gathering

• Predictive modeling

To Attract and Keep Customers

• Cost-efficient acquisition

• Retention focused on profitable and at-risk customers

• Across channels

Through On-Going Dialogue

• Real-time response

• Listening to customer

• Personalized, customized offers and messages

For Long-Lasting Mutually Beneficial Relationships

• Customer-based measurements

• Continuous customer evaluation

Data-Driven Marketing Uses Information To Drive a Meaningful & Mutually Beneficial Dialog

Relationship


The audience is not brought to you or given to you; it's

something that you fight for. You can

forget that, especially if you've had some

success. Getting an audience is HARD. Sustaining an audience is HARD. It

demands a consistency of

thought, of purpose, and of action over a long period of time.

-- Bruce Springsteen


Today, Audiences are EARNED!

Build your Audiences and They’ll Become your Customers

Nurture & Engage Them withRelevant, Value-Added Content & ToolsYou’ll Create Loyalty, Increase LifeTime

Value

Marketing MUST Move Beyond Selling & Transactions!


Why Should You Care?

+ 5% More Productive (McKinsey, Aug. 20014)

+ 6% More Profitable (McKinsey, Aug. 20014)

Integrated Analytics Can Free Up 15% - 20% Marketing $$ Budget

Annually (McKinsey, June 20014)

2X More Likely To Be High Performing (Lenskold Group, 2009)

Companies That Use Data, Metrics &/or Marketing Processes Are:


50% of Marketing Reports Missing Key Data

40% Missing ROI of Marketing 10


Why Are Companies Focusing On Data-Driven Marketing?

Customers Expect It!

“you should know I just applied for a loan on your website”

Enabling Technology is Here & Cost Effective

Proliferation of Channels & Customer Segments

“OmniChannel” Marketing

Products are Becoming Commoditized

High Cost of Customer Churn

Upside Potential

Cross Sell, Retention, & Upsell

AND, MOST IMPORTANTLY…


Rebalance Their Customer Relationships!

Customer Business

• Build Customer Loyalty

• Deliver Customer Value Across Touchpoints

• Leverage Technology For More Personalized and Relevant Communications

• Meet Higher Customer Expectations – speed, service,

convenience and value

• Customers & Consumers Have Easy Access to Information

• Effective Use of Every Contact with a Customer

Customer

Business


Company Benefits

Understanding of Cause and Effect Across All TOUCHPOINTS

• Right Offer to the Right Customer at the Right Time Through the Right Channel”

Consistent Messaging, Branding and Positioning

• Provides a Customer-Centric Point-of-View within a Product-Centric Business

Significant Improvement in Cost Efficiencies

Creates Platform for On-Going Customer DIALOGUE

Ability to Estimate “Return on Marketing Investment” (ROMI)

Manages Customer Value – Lifetime Value (LTV)


Customer Benefits

Objective Partner That Really Understands my Needs

Listens to Me

Has MY Best Interests at Heart

Understands MY Needs

Increased/Improved Responsiveness

Treats Me as an Individual - Not a Number

Uses MY Information to Add Value

“LEARNING RELATIONSHIP” a Dialog that Picks Up Where it Left Off

Ease of Doing Business – Lower Cost & Less Friction

Selectively Communicates with Me About Solutions Which are Relevant to Me


Data Enables “WHOLE BRAIN” Marketing


Data Is Readily Available

Data Has Literally Been at our Fingertips Since 1980’s

Confession, I’m a GEEK!

Freq

uen

cy

Total Basket Dollar Value

Impulse Fill In RoutineStock Up

Examples of What We Did With Data at Pepsi1) Shopping Basket Analysis

Discovered FOUR Distinct Shopping Occasions in Supermarkets


Diet Pepsi vs. Diet Coke

More Profitable• Drink More• More Loyal• More Male

More Profitable• Drink More• More Loyal• More Male

Marketing Research Showed Diet Pepsi Taste Was Preferred BLIND

2. Switching Campaign• Cobbled Together “Joseph’s Technicolor Raincoat” of Data Sources

• Built Diet Coke Household Predictive Model

• Delivered a CASE of Diet Pepsi To 1MM Diet Coke Households OVERNIGHT

• Followed Up with Outbound Ray Charles Phone Call (1st to Use IVR)

+8% Switching = $30MM per year

DATA ANALYTICS


It’s What You Do With The Data & Math That Matters!

3. Conjoint Analysis

4. LOGIT Model

5. Customer Satisfaction Reengineer Company

• Fortune Magazine July 1992 “Right Side Up Company”

• Marketing Science Institute Award


Yet TODAY Many Smart Marketers Still Aren’t Leveraging Data in Their Campaigns

• Who Here is Doing a Good or Great Job Leveraging Data in Their Marketing?

• Who Here Is Having Trouble?

WHY?


Challenges We’ve Heard

The Data is in Silos and IT Holds the Keys

That’s for Big Sophisticated Companies

We Simply Don’t Have the Budget or People

We’ve Been Doing Marketing This Way For Years, So Why Start Now

What’s the ROI that Justifies the Effort

Seems Like An Overwhelming/Herculean Task

Unclear on Where or How to Get Started


You’re Not Alone!

Teradata Corporation: “2013 Teradata Data-Driven Marketing Survey, Global"

71%

<10%18%

Unified ViewOf Customer

Systematic UseOf Data

Plan BIG DataInvestment Within

Next 2 Years


Hallmarks of Effective Data-Driven Marketing

1. A Complete, Real-Time Understanding of the Customer

2. Two-Way Mutually Beneficial Dialogues with Customers

3. Sharing Customer Information Across the Organization

4. Coordination of Messages Across ALL Points of Contact

5. Aligned Incentives Based on Customer Value

6. Organization Structured Around Customers

7. Anticipate Customer Needs and Proactively Respond to Them


How To Get Started

1. Data Repository

2. Customer Segmentation

3. Program/Campaign Management

4. Metrics


Behavioral ContextualDescriptive

Weaknesses Data Overload, Sys. Integration Complexity

Difficult to Gather and Structure Into System

Low Differentiation, Data Privacy

ExamplesPurchases, Usage;

Communication, Lifestyle

Satisfaction, Events Competitor Actions,

Online Behavior

Contact, Size, Socio-Economic, SIC, Demographics

SourcesInternal Systems, Loyalty Schemes,

External Data Sources

Social Media, Cookies,

Market Research

Operational Systems, External

Data Sources

Strengths Personalizes to organization Relevant to CustomerEasily Available

Key toSuccess

Completeness CreativityAccuracy

PurposeUnderstand Customer’s

Behavior

Understand Motivations & AttitudesUnderstand Customer

Different Types of Customer Information

First You Need to Have a Customer Information Strategy

Increasing Difficulty & Value


Customer Dialog Management

Customer Provides Information About Needs, Preferences

Tailor Your Product/Service

Increased Customer Loyalty, Retention AND Profits

Data Collection That Focuses on Creating “Consensual Customers”

High ValueCustomer Service Rep

Data Mart

Two way communication

Barrier to EXIT

“Drip Irrigation”


Append!


2. Customer Segmentation

First Segment Customers by Needs

Then Differentiate Them by Value

Profile Your Best Customers

Build “Look-Alike” Models To Find More Customers Just Like Them

Create Best Customer Personas & Use Scenarios

Design an Omnichannel Customer Journey Map

Validate, Mine & Refine


3. Campaign Management

Engagement! Content! Contextual!

Focus On What’s Relevant To The Customer

¨ What Need Does Your Product or Service Meet

¨ What Problem Does It Solve

¨ How Does It Make Their Life Easier

Omnichannel Integration Is Essential

Enable Sharing & Social Evangelism


4. Metrics

EVERYTHING That’s Happening with Digital Analytics Applies Offline Too!

¨ Although More Creativity in Math & Collection Processes Are Required

Individual Customer Metrics NOT Aggregate

Anchor Analytics to Business Strategy

¨ First Develop Hypothesis

¨ What Are the Metrics That Will Prove or Disprove

¨ What Are ALL the Points in Process and Touches to Collect This Data

Marketing Return on Investment Is a MUST

¨ It’s What the Board Room & VC’s Expect

¨ Essential for Winning Resources Back from CFO


Let’s All Be Leonardo!


Or Einstein!


Case Studies


• Very Crowded Market and Small Share of Voice

• Product Advantage in Treating Migraines

• Identified High Value Households• Created a Customer Database

• Established Headache Remedy Center (HRC); Community Website, Newsletter, Research Studies

• Early Positive Result

Situation

Actions

Results

Bristol-Myers Squibb – Excedrin

Awareness Equity Share

Retention

Line Extension


• Declining Share & Increasing Competition• Brand Has Advanced Therapeutic Effects –

FDA Regulated• Consumers Dearth of Oral Care Info &

Insights

• Tagged ALL Media• Identified high value households• Created a customer database

• Content-Rich Oral Care Newsletter (Objective content with subtle sub-branding and an occasional incentive)

• Created a dynamic web site with access to dental professionals

• Increased Retention Rates and share of

customer• Launch Toothbrush Line Extension• Identified Cross Category Opportunities with

Dove Soap

Situation

Actions

Results

Unilever – Mentadent Toothpaste


• Only 18k Customers but Few Insights• Mass Marketing by Tractor Trailer Load

• Cobbled Together Exiting Research & Customer

• Data Appended Third Party Data • First Ever Customer Segmentation• Secured funding for customer data mart

based on biz value• Spiffed Sales for Inputting Critical

Information for “Top Dogs”

• Aligned objectives across business units driven by needs-based customer segmentation

• Increased sales force efficiency by 22%+

Situation

Actions

Results

Veterinary Healthcare Company


Luxury Furniture aka. Functional Art

Situation

Actions

Results

• Only 4 Years of Transactional Data• Going to Market as Cataloger

• Analysis Proving Showroom Driven NOT Catalog• Top Quartile Customers 3rd Party Data

Appended with Third Party (all Axciom)• Identified 44 Predictive Variables• First Ever Customer Segmentation Using

CHAID 44• Defined Showroom Based Trading Zones• Introductory Direct Mail

• Store Events• Acquired New Customers• Opened New Showrooms & Closed Others


Merklewww.Merkleinc.com


The Situation¨ Our healthcare client was experiencing diminishing response rates.¨ Acquisition costs were rapidly spiraling upward.¨ Marketing plan was utilizing heavy outbound solicitation.¨ Mostly direct mail to “never-a-customer” base.¨ Plus outbound calls and emails to “past” customers/members.¨ Heavy use of focus groups and concept tests.

¨ The target market was not homogenous, but highly segmented.¨ Segmentation was neither demographic nor psychographic, but physiographic.¨ Healthcare plan attitudes and intentions were closely aligned with disease states and diagnoses.¨ Prescription patterns were the principal marker driving “urgency”.

New England Recommendations¨ Harness prescription data (to which the plan had access) to time outreach. ¨ Segment prospects by prescription patterns as a surrogate to diagnosis.¨ Tailor prospect messaging to market segments which were highly motivated.¨ Use evolutionary algorithms to accurately predict responses/behavior in response to over 100 million offers (seriously).¨ Beta test specifically tailored messaging to key market segments:

• Recent “Initial Diagnosis”• Second Disease “Add a Prescription”• Exhausted “Disease Sufferers” (older and in poorer health)

Results¨ One New England recommendation outperformed a half-dozen submissions from multiple agencies.¨ National rollout outperformed test at over 5X normal levels and 25X normal ROI.¨ “The insights and messaging optimization brought our segmentation to life and generated unheard of patient response rates – double digits. We enrolled over 12

million patients in the first year. It was a huge breakthrough and created an enormous amount of new value.” – VP & Chief Creative Officer, PBM

One of the World’s Largest PBM’s(Pharmaceutical Benefits Managers)

Response Rates

YearBase/Control

Agencies RecommendationsNECG Submission


New England Consulting Group

The New England Consulting Group is a marketing and sales firm that collaborates with companies that are or wish to become the market and thought leaders in their domain space.

Each of the partners has over 25 years experience managing businesses at companies like Procter & Gamble, J&J, Starbucks, Unilever, Covidien, Kellogg’s, PepsiCo, Novartis, Kraft, and Merck.

NECG’s industry focus ranges from consumer goods to high tech to financial services to healthcare.


www.linkedin.com/in/aileencahill/

@AileenCahill

Customer-Ergonomics.com

[email protected]

http://www.linkedin.com/in/aileencahill/


http://www.customer-ergonomics.com/


https://twitter.com/AileenCahill

whole-brained marketing -- blending data science with creativity & action

Marketing

agile marketing

engagementmetric dollar

datadriven marketingaka

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hallmark of winners

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