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■COMMERCIAL PROFILE In association with
Transform customer data
into profit
Using analytics, make sure you’re giving the right
customers the red-carpet treatment, says Michael
Kearney, managing director, SAS?Ireland
Michael Kearney
CUSTOMER-first. Customer-focused. but questioning whether more even remember them. We’re the
Customer-driven. Customer-centric. orange juice really produces more stars now, they say. If a company
Customer-obsessed. Such phrases profit. Maybe those efficiencies wants our money, then we want red-
have regularly been bandied about in come at the expense of enterprise- carpet treatment.
the management lexicon over the level goals. Maybe all these opti- Yet, giving everyone the red-
past few decades, as though each mised processes are delivering a carpet treatment can backfire.
new wave of strategists was the first sub-optimal customer experience Consider the case of an international,
to realise that revenue, ahem, comes because they didn’t adapt to the upscale women’s clothing retailer.
from customers. customers’ changing needs. The company thought its loyalty
That fact seems self-evident, but Customers’ expectations are cer- programme was working fine, until
what has been less clear is exactly tainly changing. Consider YouTube, it analysed its data and discovered a
how to maximise the value of your Wikipedia and the blogosphere. The substantial portion of customers
customers, how to insulate your best new digital democracy is one where were taking advantage of loyalty
customers from the competition and consumers expect to star in their programme discounts and returning
why attempts to be ‘customer- own personalised realities; con- 90pc of what they bought after the
centric’ have so often fallen short of sumers have been transformed. season ended. Some customers just
expectations – both for customers They’re not just lining up to buy really aren’t worth the red-carpet
and for the companies that hope to what’s offered; they expect to be treatment.
profit from them. valued participants in the process.
Retailers have long acknowledged Customers blog their grievances,
Empowering marketing,
the value of customer relationship post their reviews, eBay their cast-
management (CRM) – of mobilising offs, publish their creativity and cus-
sales and service with
resources around customer relation- tomise their information streams. analytics
ships rather than product or mer- The global media machine showcases
How do you find the customers
chandise groups, and fostering activ- each as an individual. Your customer
worthy of red-carpet treatment and
ities aimed at maximising customer may fairly ask, ‘Why can’t your busi-
those who may be groomed to be
lifetime value. The same can be said ness do as much for me?’
your future stars? Forward-
for enterprise resource planning And furthermore: ‘Why are you
thinking organisations have ampli-
(ERP) systems, which introduced sending me a coupon that expires in
fied their ‘return on automation’ by
new efficiencies by streamlining 30 days just a week after I spent
investing in analytical CRM as well.
processes across the organisation. ¤500 on clothing at your store? Why
Analytical CRM provides the
In many cases, these operational is the promotion coupon for non-
understanding and insight to confi-
systems brought value but they fiction books when I only buy fic-
dently make decisions that drive
could only do what they were tion? Why am I getting promotions
profitability.
designed to do – reduce costs and for girls’ clothes when I’ve only
Consider the possibilities. Analytic
increase efficiency. Ultimately, bought boys’ clothes? Why are you
insights can enable retail companies
improving operational efficiency is barraging me with emails for choco-
to:
like squeezing an orange. With the late when I only order fruit baskets?’
• More effectively identify and
first squeeze, you get a significant Faster plus more efficient doesn’t
retain profitable customers and
return on investment. The next always equal better. Enterprise-wide
attract others like them by creating
time, you get a little less, and then operations systems can automate
timely and tailored offers that
even less. Clearly, enterprise-wide customer interactions but alone do
reflect each customer’s uniqueness
operational platforms are important not provide the insights necessary to
and preferences
but, by themselves, are not a panacea. enhance the mutual value of those
• Adjust pricing strategies to
Automation without insight has only interactions.
counter competition, win sales and
limited potential. These missteps would lead your
maximise profitability
Maybe the answer isn’t squeezing customers to believe you don’t
• Increase sales per customer by
a few more drops out of the orange, understand their needs and don’t
predicting which are most likely to
36 Knowledge Ireland September 2008
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