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TRANSCRIPT
© 2013 Acxiom Corporation. All Rights Reserved.
BUILDING WORLD-CLASS MARKETING CAPABILITY
MARKETING IN THE NEW
NORMAL
Best Practices in Retail Financial Services Symposium March 15, 2013
AC-0362-13
AGENDA
> The New Normal
> Acxiom Marketing Maturity Model Overview • Benchmarking Financial Services: Where We’re Good, Where We’re Not
So Good
• SPOILER ALERT: – We Are EXCELLENT Where We Have to be: Privacy and Compliance,
Governance and KPIs
– We FAIL in Most Things Customer-Focused
> Roadmap to Excellence • Customer Lifecycle Management • Single View of the Customer
• Offline / Online Integration • Improving Marketing ROI
2
THE NEW NORMAL
UNCERTAINTY AT EVERY TURN
Banks Face Many Global Challenges
> Economic
> Regulatory
> Capital
> Credit risk
> Competitive
> Interest rate
> Political
CMOs Noted Bank-Specific Challenges
> Customer antipathy
> Segment proliferation
> Incorrect goals
> Business complexity
> Data explosion
Voice of the CMO
“Right now our industry is facing the most significant array of challenges that we’ve ever seen in this generation and probably the one prior: a record low interest rate environment that the Fed thinks will be sustained through 2014; we just came through a crisis of faith and confidence in the financial services industry; regulatory changes eliminated some ways that we used to be able to make money. So the economics of the business have changed completely.”
Banking Challenges: • Economic • Regulatory • Capital Requirements • Credit Risk • Political Dysfunction • Interest Rate • Competition
• Customer Antipathy • Segment Proliferation • Business Complexity • Data Explosion • Channel Proliferation • Changing Customer
Preferences
3
THE CASE FOR CHANGE
UNDERSTANDING GENERATIONS WILL
DETERMINE SUCCESS OR FAILURE IN
FINANCIAL SERVICES
THE RABBIT IN THE BOA
The Age of Retirement Distribution of U.S. Population by Age and Sex
Percentage
5
Female Male
2030 2010 Source: US Census Bureau
CUSTOMERS BY AGE DEMOGRAPHIC
Generation Ages
A - Gen Y 18-28
B - Gen X 29-46
C - Boomers 2 47-56
D - Boomers 1 57-66
E - Seniors 3 67-77
F - Seniors 2 78-88
G - Seniors 1 89-100
0M
1M
2M
3M
4M
5M
6M
7M
8M
9M
10M
2M
9M
6M
5M
3M
2M
0.3M
Customer Counts by Generation – Top 10 Bank (2012)
6
CUSTOMER PROJECTION BY
GENERATION
* Simple projection of client age not taking into account acquisition and attrition **Assumes same market share in an age group with age group size defined by US Census projections
Time
Projected % change of # of clients in
given generation in 9 years
Today’s client count
2011
2014
2017
2020
0M
1M
2M
3M
4M
5M
6M
7M
8M
9M
10M
2M
9M
6M
5M
3M
2M
0.3M
-32% -9% +37%
+96%
+48%
Customer Counts by Generation - Projection*
7
-32%
-9%
+37%
+96%
+48%
0.0
50.0
100.0
150.0
200.0
250.0
300.0
350.0
Tota
l Bal
ance
He
ld b
y G
en
era
tio
n
Total Balance 2020 (projection)
0.0
50.0
100.0
150.0
200.0
250.0
300.0
350.0
Tota
l Bal
ance
He
ld b
y G
en
era
tio
n
BALANCE / VALUE PROJECTION BY
GENERATION
> Total projected 2020 credit card balances are approximately equal to 2012. However, 16% is moving from below 56 years old to above 56 years old
8
GENERATIONS BY CHANNEL USAGE
Buying Channel Propensity Media Usage Propensity
Internet Mail Phone Internet Cell
Phone Primetime
TV Daytime
TV Outdoor
Yellow pages
Radio Magazine Newspaper
A - GenY/Millennials 117 60 62 122 127 57 99 104 114 121 124 43
B - GenX 107 89 92 120 129 64 74 114 110 121 118 73
C - Boomers 2 100 105 106 109 108 92 71 109 113 115 104 106
D - Boomers 1 98 113 114 99 83 122 109 102 101 93 95 121
E - Seniors/retirees 3 88 113 105 55 51 164 175 64 62 44 65 137
F - Seniors/retirees 2 76 116 101 21 27 188 200 42 45 27 47 142
G - Seniors/retirees 1 77 114 99 21 20 194 196 41 44 27 48 142
Internet and cell phone are most popular with younger generations.
Both primetime and daytime TV are most popular in older
generations.
9
CUSTOMER CHANNEL PROJECTIONS BY
GENERATION
Generation B: 29 – 46 C: 47 – 56 D: 57 – 66 E: 67 – 77 G: 78 – 88
Current Value and Change in 9 years
$305B $204B $120B $60B $30B
-32% -9% +37% +96% +48%
With time, Internet usage will be growing in all generations, as customers age
Usage of TV (and other traditional media) usage will
decrease
+4% +7%
+9% +42%
+56%
Internet Usage Propensity 2011 vs. 2020
2011
2020
-14% -36%
-32%
-31%
-10%
Primetime TV Usage 2011 vs. 2020
2011
2020
10
HARNESSING DATA / ANALYTICS
CMO CHALLENGE #1
> Every CMO respondent highlighted analytics as a core competitive advantage
> Yet each one also expressed a deep-seated fear of falling behind
> Reasons for the gap included lack of talent, non-analytical culture outside of marketing and digital data overload
> Despite significant expertise in campaign management and related analytics, CMOs express concern over a lack of integrated, cross-channel analytical talent
Voice of the CMO
“In the last five years, other than compliance-related issues, the analytics are the hottest topics. It’s one of the areas that, from a talent standpoint, I would say we’ve got a gap in the marketplace.”
11
CMO CHALLENGE #2
LACK SINGLE VIEW OF THE CUSTOMER
> CMOs play a critical role in aggregating customer and prospect data
> The crucial data function results in CMOs seeing themselves as the ultimate “keeper of truth”
> All CMOs interviewed lamented their lack of a true 360-degree view of the customer
> Lack of IT resources, incompatible data sources, legacy systems and data ownership were all issues cited preventing a single customer view
Voice of the CMO
“You cannot truly understand the complete value that a customer is bringing to the bank unless you can look at that customer across lines of business. A consumer may own a small business or also be a wealth client. Unless our systems all talk to each other, you just don’t know.”
12
CMO CHALLENGE #3
CONTINUOUS IMPROVEMENT IN MROI
> CMOs believe they have campaign management figured out – BUT they struggle with one-to-one marketing
> Media spend continues to be a challenge with uncertain returns, despite consuming significant marketing budget
> Adding digital channels to the mix is creating tremendous uncertainty – and attribution models are still nascent
> Few CMOs currently leverage a forward-looking customer profitability to drive marketing strategy
Voice of the CMO
“I think the Madmen are gone, I really do. The old intuition that it’s going to be a great campaign and it’s going to be successful – that’s now offset by the need to have statistically valid proof. You need proof that the return will be appropriate, the media selection will be right, the creative message will break through, the response will be good enough, whatever the medium. You need proof that the program will deliver the economic baseline that it has to.”
13
MATURITY MODEL
14
EXECUTIVE OVERVIEW
What Is the Acxiom Marketing Maturity Model? > An Acxiom proprietary tool and methodology to evaluate Banks’ current
marketing capabilities with an eye toward increasing strategic value > A scoring model to evaluate marketing performance against best practices
or agreed-upon targets (targets assume a best-in-class approach to data-driven marketing)
> A strategy planning tool to help establish customer vision and future priorities, orchestrate alignment across the C-suite and plan future investments
How Do Acxiom Clients Use the Maturity Model? > Evaluate current state capabilities > Prioritize gaps to close and strengths to leverage > Increase internal communication and build consensus > Build a strategy roadmap to focus resources on highest-ROI initiatives
15
5 Capabilities
Capability – the ability to perform strategic
actions
20 Dimensions
Dimension – a distinctive feature of a
capability
ACXIOM’S PROPRIETARY MARKETING
MATURITY MODEL
71 Attributes
Attribute – an observable characteristic that can be assessed and measured
Doug Christiansen Understanding The Consumer
Information Management
Doug Christiansen Data
Analytics Decision
Implementation Consumer Experience
Capabilities 1 2 3 4 5
Dimensions
1.1 Consumer Value / Social Influence
2.1 Collecting Data Online/Offline
3.2 Contact / Media Optimization
5.1 Search and Social (Find me)
4.1 Business Processes
4.2 Marketing Execution
4.3 Organizational Alignment
5.2 Consistent Consumer Interaction
5.3 Personalized Sales & Service
1.2 Lifecycle Management
1.4 Privacy and Compliance
3.1 Analytic Processes
Doug Christiansen 3.3 Data
Visualization 1.3 Consumer
Preferences
2.2 Integrating Data Online / Offline
2.4 Information Governance
4.4 Infrastructure Capabilities
3.4 Key Performance Indicators
5.4 Agent / Partner / Distributor/ Dealer
2.3 Recognition Anonymous to Known
16
THE ACXIOM MARKETING MATURITY
MODEL
ATTRIBUTES AND MATURITY LEVELS
Level 1
Performed
Level 2
Managed
Level 3
Standards
Defined
Level 4
Quantitatively
Managed
Level 5
Optimizing
Characteristics of Maturity Levels
Understanding the Consumer
Capability 1
Consumer Value/ Social Influence
Dimension 1.1
Attribute 1.1.1 Extent of Consumer Information Collected
Attribute 1.1.2 Understanding of Consumer Value
Attribute 1.1.3 Understanding of Social Influence
Assessment questions lead to scores which
determine the current level vs. desired level of
performance… thus identifying the gap to be
addressed.
Attribute 1.1.4 Understanding Consumer Needs
5 Levels of Maturity
17
GAP EVIDENCE HEAT MAP
VIA ACXIOM’S MARKETING MATURITY MODEL
Dimensions
Doug Christiansen 1.1 Value & Influence 2.1 Collection
3.2 Marketing Mix Optimization
5.1 Search and Social
4.1 Business Processes
4.2 Marketing Execution
4.3 Org Alignment
5.2 Consistent Interaction
5.3 Sales & Service
Doug Christiansen 1.2 Lifecycle Management
1.4 Privacy and Compliance
3.1 Analytic Processes
3.3 Data Visualization 1.3 Preferences
2.2 Integration
2.4 Governance 4.4 Infra- structure 3.4 KPIs 5.4 Partners
&Agents
2.3 Recognition
Doug Christiansen Understanding the Consumer
Managing Information
Doug Christiansen
Analyzing Data Implementing Decisions
Managing the Consumer Experience
1 2 3 4 5
Capabilities
Not Assessed
Gap 0.00 to 0.50
Gap 0.51 to 1.50
Gap 1.51 to 2.50
Gap 2.51+
Summary:
1. The capability gaps illustrate specific opportunities for both transformational and incremental change. RED, ORANGE and YELLOW areas highlight potential priorities with red having the largest capability gaps.
2. Overall, Capability 5, Managing the Consumer Experience, provides the greatest area of improvement opportunity for banks.
18
ASSESSMENT DATA AND FINDINGS
Capabilities Sorted by Gap
Overall Findings
Incremental improvement is available across all 5 capabilities
The most significant opportunities for improvement are found in Managing the Consumer Experience
1.9
2.0
2.2
2.4
2.6
3.0 Analyzing Data
1.0 Understanding the Consumer
2.0 Managing Information
4.0 Implementing Decisions
5.0 Managing the Consumer Experience
Legend
Not Assessed
Gap 0.00 to 0.50
Gap 0.51 to 1.50
Gap 1.51 to 2.50
Gap 2.51+
19
0.3
0.3
0.7
1.6
1.7
1.7
1.7
2.0
2.0
2.0
2.3
2.3
2.8
2.8
3.0
3.0
3.2
3.3
3.7
4.0
1.4 Privacy & Compliance
3.4 Key Performance Indicators
2.4 Information Governance
3.1 Analytic Processes
2.1 Collecting Data Online / Offline
4.2 Marketing Execution
4.4 Infrastructure Capabilities
1.1 Consumer Value / Social Influence
1.3 Consumer Preferences
5.3 Personalized Sales & Service
2.3 Recognition - Connecting Known to …
5.1 Search & Social (Find Me)
3.2 Marketing Mix Optimization
3.3 Data Visualization
4.3 Organizational Alignment
5.4 Agent / Partner / Distributor / Dealer
4.1 Business Processes
5.2 Consistent Consumer Interaction
1.2 Lifecycle Management
2.2 Integrating Data Online / Offline
ASSESSMENT DATA AND FINDINGS
There are a wide range of gaps across the 20 capability dimensions
The higher-performing capability dimensions can be leveraged to increase ROI
Dimensions Sorted by Gap
Relative to their overall scores, banks are weakest here…
Banks are strongest in these areas…
Findings
20
TYING IT ALL TOGETHER
Gaps to Close *
Strengths to Leverage **
* Sorted by size of gap high to low ** Sorted by strengths (biggest strengths have the smallest gaps)
Understanding of Consumer Value Consumer Interaction Ability Consumer Engagement Process Anonymous / Cash Transactors Offline data readiness for integration Online data readiness for integration Offline and Online Integration Online Infrastructure Test and Learn Business Intelligence (BI) Tools Digital Marketing Processes Defined Inbound / Event Triggered Marketing Processes Lead Management Consumer Management Responsibility
Understanding Consumer Needs Known Consumers Geo and Market Level Data Collection Benchmarking the Competition Tie to Goals and Strategies Interaction with Business Users
21
MATURITY MODEL CONCLUSIONS
4 CRITICAL GAPS FOR BANKS
1. Customer lifecycle management
2. Single view of the customer
3. Offline / online data integration
4. Marketing ROI
22
ANALYTICS ROADMAP
Phase 1: Data collection and cleaning
• Rankings, distributions
Phase 2: Reporting
Phase 3: Draw conclusions from reporting • diagnostics
Phase 4: Use data to draw inference to drive customer strategy • Univariate and multivariate
analysis, propensities, predictive models
Phase 5: Real-time insights • Data drives customer
interactions in real time
23
CUSTOMER LIFECYCLE
MANAGEMENT
DID YOU KNOW…
THE AVERAGE MASS AFFLUENT HOUSEHOLD RECEIVES 70 PIECES OF MAIL IN A TYPICAL WEEK…
> 3 Credit card offers from current banks
> 3 Mortgage or finance offers
> 6 Credit card offers from new banks
> 2 Investment mailings
> 6 Statements from banks or investments
> 22 Charity solicitations
> 2 Car dealership promotions
> 3 Bills
> 36 Miscellaneous mail pieces
> 3 Newsletters
> 3 Magazines
> 5 Miscellaneous postcards
> 5 Personal letters
> 2 Parcels
25
…HOW WILL YOU STAND OUT IN A CROWDED MAILBOX?
STRUCTURE: CUSTOMER LIFECYCLE
MANAGEMENT
Goal
> Meet customer needs at every interaction
> Sense and respond to customer needs
Steps
> Short term: Customer lifetime value – which customers to talk to?
> Medium term: Wealth / lifestage segmentation – how to talk to customers?
> Long term: Life event based triggers – when to talk to customers?
26
CUSTOMER LIFETIME VALUE
Q: WHICH CUSTOMERS SHOULD WE TARGET?
- 400%
+ 500%
Top 30% Next 50% Bottom 20% 0 %
Profit Neutral
Profit Destroyers
Profit Creators
Customer Value Segment
NOT ALL CUSTOMERS ARE CREATED
EQUAL
DID YOU KNOW… The top 30% make up 500% of the profit. The bottom 20% consume 400% of profit. Know the difference.
28
Components of CLV A RIGOROUS YET SIMPLE APPROACH
TO CLV
CLV = f Recurring Value
Attainable Growth Potential Marketing Costs Expected Attrition Loss
Recurring Value
Attainable Growth
Potential
Expected Attrition
Loss
Marketing Costs
CLV = + – –
-Discounted to Present Value-
29
THE POWER OF CLV ACROSS THE
ENTERPRISE
> In addition to targeted direct marketing, clients have also used accurate CLV for the following customer decisions: • Relationship pricing • Fee waivers and rebates • Market opportunity assessments • Measurement of organic growth for stock analysts and shareholders
Foundational Analytics
• Custom segmentation
• Share of wallet growth potential
• Propensity modeling
• Price sensitivity
• Early warning attrition
Lifecycle Analytics
• Closing the loop
• Response models
• Incremental (lift) models
• Back-end reporting and refinements
• Cross-channel integration
Full Lifecycle Optimization
• Profitable acquisition targeting
• Customer need category (growth, risk, service)
• Optimization of cross-channel outbound campaigns (AIM)
• Optimization for inbound offers
Influencing Marketing
Enabling Marketing
Driving All Marketing
30
WEALTH- AND LIFESTAGE-BASED
SEGMENTATION
Q: HOW TO TALK TO CUSTOMERS?
Absolutely nothing except that they’re neighbors.
GEO-level targeting is easy, but ineffective.
The Hermans The Palluzzis
WHAT DO THESE HOUSEHOLDS HAVE IN
COMMON?
The Wallaces
32
WEALTH AND LIFESTAGE YIELDS A
POWERFUL SEGMENTATION SCHEME
Retired Pre-Retired Families With Children
Couples & Singles
Youth Retired Pre-Retired Families With Children
Couples & Singles
Youth Retired Pre-Retired Families With Children
Couples & Singles
Youth Anticipation Marketing
Modest
Affluent
Mainstream
Wealthy
Transitions
Events
SO Starting
Out
ACS
Affluent Couples &
Singles
AF
Affluent Families
AP Affluent
Pre-Retired
LS Luxury Seniors
CS Comfortable
Seniors
RS Restrained
Seniors
MCS
Mainstream Couples &
Singles
MF
Mainstream Families
MP
Mainstream Pre-Retired
E Enviables
L Limiteds
33
STRONG SEGMENTS CAN BENEFIT
EVERY PART OF THE ORGANIZATION
E ENVIABLES
ACS AFFLUENT COUPLES/SINGLES
AF AFFLUENT FAMILIES
AP AFFLUENT PRE-RETIRED
MCS MAINSTREAM COUPLES/SINGLES
MF MAINSTREAM FAMILIES
MP MAINSTREAM PRE-RETIRED
LS LUXURY SENIORS
CS COMFORTABLE SENIORS
RS RESTRAINED SENIORS
SO STARTING OUT
L LIMITEDS
Data
Prospecting
Consulting and Analytics
Enhancement Data
Segmentation Licensing
Serv
ice
s &
So
luti
on
s Geo Targeting
Strategy
DM / Digital Agencies
Behaviors / Attitudes
Spending Optimization
Cross-Channel Targeting
Recognition
Branding
Segmentation
Product
Pricing
Sales and Service
Channel Distribution
34
EVEN A SIMPLE VIEW DEMONSTRATES
THE POWER OF SEGMENTS
35
REAL-TIME TRIGGERS
Q: WHEN TO TALK TO CUSTOMERS?
REAL-TIME TRIGGERS BENEFIT
CUSTOMERS AND BANKS ALIKE
Date Stamp
Accuracy
Relevance Scale
In-Market Data
Just-in-time Marketing
Higher ROI
Customer/Prospect Engagement
Relevant Messaging
Improved Response Rates
+
+
37
LAYERING LIFE EVENT TRIGGERS
DRIVES CUSTOMER CENTRICITY
Gets married Has a baby
Buys a house
Career Path Family Security Becomes Priority
Customer Value
New Young Adult Household –
Client interests shift – college,
retirement;
Enabling Capabilities
Optimized Actions
Across Channels Across Consumers Across Products Across Time
Processes
Attract Grow
Maximize Return on Consumer Investment: ROI, Profitability
Information Insights Infrastructure Intelligence Organization
Acquire Retain
38
SINGLE VIEW OF THE CUSTOMER
of their customers agree
believe their brand
delivers a superior customer
experience
80% of CEOs
Just 8%
A CRISIS IN CUSTOMER ENGAGEMENT
40
NOW IT’S
JUST ANOTHER
LIGHT SOURCE TV USED TO
BE THE TRIBAL
CAMPFIRE
41
JUST 32% OF
SENIOR MARKETERS
KNOW HOW THEIR
CUSTOMERS
BEHAVE ACROSS
CHANNELS*
CROSS-CHANNEL
BUYERS ARE 4–5X
PROFITABLE
A CRISIS IN INSIGHT AND FOCUS
42
CUSTOMERS TALK TO US…IF ONLY WE
WOULD LISTEN
Facilitate a continuous dialogue with individuals to address their wants and needs as they evolve in right-time.
Apple Genius and Pandora Music recommend content based on collaborative filtering and wisdom of the crowd.
Microsoft’s Clippy predicts assistance based on user actions.
Preference centers allow users to indicate how and when they want to be contacted.
Data Insights Engagement Enchantment
43
STRUCTURE: SINGLE VIEW OF THE
CUSTOMER
Goal
> Enable customer-centricity through data analytics – seamless experience across all channels and products
Steps
> Short Term: Track customer channel preferences…and act on them
> Medium Term: Improve customer recognition to create personalized interactions / experience
> Long Term: Real-time decisioning
44
TRACK CUSTOMER CHANNEL
PREFERENCES…AND ACT ON THEM
UNIVERSAL PREFERENCE CENTER IS
FIRST STEP TO CUSTOMER CENTRICITY
SINGLE, CENTRALIZED, CROSS-CHANNEL INTERFACE FOR CUSTOMERS (AND STAFF) TO CAPTURE AND EDIT CUSTOMER DATA:
> Permissions: Channels through which bank can contact consumer (email, phone, mail, SMS) • Can include frequency (“email me less” “suspend mail while on vacation”) • Customer benefits: Control over when and where each message stream is delivered • Bank benefits: Legal compliance, cross-promotion of all subscriptions, migration to
lower cost channels > Preferences: Content, products, topics that customers care about (checking, savings,
mortgage) • Can be explicit or implicit; raises consumer expectations of the marketer • Customer benefits: Relevant messaging, transparency into total profile • Bank benefits: More effective marketing due to improved relevancy
> Subscriptions: Marketing vehicles or publications available from the brand (weekly email, monthly newsletter, SMS alerts) • Customer benefits: With one visit, customer can learn about and join all marketing
initiatives of interests • Bank benefits: Facilitates opt-down instead of universal opt-out; gain insights into
popularity of various marketing programs
46
A BEST OF BREED PREFERENCE
CENTER IS…
Complete: > Displays all customer information collected at all touch points
Accurate: > Standardized and corrected upon import
Current and Available: > Customer has real-time, always-in access to their profile
Actionable: > Customer immediately sees the impact of sharing preferences via personalized
marketing > No extraneous questions required
Transparent and Accessible: > Customer controls consent, preferences, interests, frequency and channel > Authentication is simple and centralized; single sign on
Reinforces customers’ relationship with the brand
47
ONLINE DATA COLLECTION CAN DRIVE
IMMEDIATE GAINS IN CONVERSION
Online Ads
Client Website
Example: Online Traffic
Data captured by the website: • Keyword • Referring URL • Ad or segment • IP data • Cookie • Prior visit history
Testing isolates optimal balance
between capture of more visitor data and
conversion gain
Improve conversion in current session Look up offers by invitation number, name and address, ad campaign, or visitor segment Data from the session can be applied to future sessions and to campaigns in other contact channels
Data captured from traffic sources drives landing page
personalization for each visitor
1
2
3
Capture of visitor identification enables linking to off-line data
that will drive conversion gain
48
USE COLLECTED DATA TO FINE-TUNE
APPLICATION COMPLETES
Testing isolates number of offers, variance in offers, contact strategy, counter offers to
display
Use of current session and off-line data into targeting models drives
optimal offer display
Complete the application on-line, in client call center, or branch Trigger follow-up email or text message to non-responders Capture session data for future campaign targeting
1
2
3
49
IMPROVE CUSTOMER RECOGNITION
CUSTOMERS ARE IN A CONSTANT STATE
OF FLUX
IN ONE HOUR…
IN ONE YEAR…
> 5,769 people in the U.S. will change jobs
> 2,748 people will change address
> 515 people will get married
> 263 people will get divorced
> 186 people will declare a personal bankruptcy
> 4.7 million people will get married
> 1.53 million people will become first-time parents
> 2.04 million people will buy their first home
> 1.9 million people will get divorced
> 43 million people will move
> 1.4 million people will retire from work
Customer data changes at a rate of 2% per month; a 1 million-record database loses 240,000 records per year and is obsolete in four years. For a typical quarterly mailing of 2MM, this loss
of data fidelity equates to $600k in wasted mail costs alone. (Not to mention the lost income from inaccurately targeted mailings).
Source: D&B, U.S. Census Bureau, U.S. Department of Health and Human Services, Administrative Office of the U.S. Courts, Bureau of Labor Statistics, Gartner, A.T Kearney, GMA Invoice Accuracy Study 51
TRACKING CUSTOMERS
IS HARD BUT ABSOLUTELY CRITICAL
Name Contact and Life Stage Changes
Touchpoints Call
Center
Direct Marketing
Brick & Mortar
Website
Address Home Phone
Computer
Cell Phone
Customer Support
Digital Campaign
52
BETTER RECOGNITION CREATES VALUE
FOR CUSTOMERS AND ENTERPRISE
Connects Disparate Customer Records across Channels > Establish client specific match rules, groups, etc. > Identify duplicates and associate multiple entries > Identifies the most accurate contact information
Maintains Consolidated Views of Relationships over Time > Synchronizes client-specific identifiers to keep
customer current and accurate across multiple channels as data and/or personas change
> Helps maintain accurate member view and relationships across the organization
> Provides a single, reconciled and cross-LOB customer view as the relationship changes
Data Management > Data quality update frequency-entire database is
updated with data quality in an automated fashion, eliminating the need for full file transfers
> Persistent key management-full management of splits and consolidations for individuals and households, eliminating the need for data stewardship
Customer Recognition
Hub
Transform
Data Survivorship
Privacy Mgmt
Record Grouping
Send Receive
Data Data Quality
Hierarchy- Iterations
Digital Data Quality
External Data
Append
AbiliTec Linking
53
REAL-TIME DECISIONING
Rules Predictions RTM Optimize Control RTD
REAL-TIME CONTINUUM – COMPLEXITY /
FUNCTIONALITY
Easy If then, else guides processes; does not include insight or customer context; provides access to data
Real-Time Marketing
Application of predictions in batch environment presented in real time
Real-Time Decisioning Predictions built (adaptive) and executed in real time combined with rules. Seeks to enhance the customer experience but will optimize on multiple objectives
Predictive Models
Statistical predicitions of behaviour used to determine actions; insight
Optimization
Goal-seeking mathematics generally used to optimize budget in outbound campaigning
Tough Real-time monitoring, management and control over interactions. What-if scenarios for planning and optimization
55
STEP 1: REAL-TIME OFFER SELECTION
> Offer presentation
• Present offers created and assigned in campaign execution process
• Basic summary
> Real-time optimization
• Select best choice from offers created and assigned for campaigns
• Synchronize touch points and customer activities
> Dynamic offer assignment
• Generate best offer from value propositions created by campaign manager
• Complex summary including scores from models
• Create personalized recommendations
Co
ntext o
f In
teractio
n
Availab
le O
ffers
Summary Strategy Decision
One Case
All Workflows
Simple, Static
Complex, Variable One Product Per
Customer
Suite of Offers Per Customer
Simple, Static
Complex, Variable
56
STEP 2: CREATE AN INTEGRATED
CUSTOMER INTERACTIONS
Call Center
Consumer
Website
Customer Insights
Customer Data
Third-Party Data
Customer Analytics
Rich Segmentation
Inputs:
Outputs:
Decision Data
POS
Events
Promotions
Specials
Personalization
--------------
57
STEP 3: REAL-TIME DECISIONING TO
REALIZE CUSTOMER CENTRICITY
Outbound Channels
Inbound / Interactive Channels
“Pull” Targeting
“Push” Targeting
Campaign Management
Marketing Databases
Content
Middleware, Business Rules
Analysis, Planning & Budgeting
Customer History
> Client Data > Third-Party Data > ETL Processes > Grouping Rules > Triggers
Campaign Execution
Customer Perception Product
Pricing Availability
Operational History
Content
58
OFFLINE / ONLINE INTEGRATION
FIVE STEPS TO REACH THE PINNACLE OF
ONLINE / OFFLINE INTEGRATION
DRIVE YOUR BUSINESS TO TRUE, CROSS-CHANNEL MARKETING MASTERY
Phase 4: Expand DMP application > Audience optimization > Site and offer optimization > Enterprise insights and execution
Phase 3: DMP and Analytics for Media Optimization > DMP for media optimization > Onboard your own offline data > Analytics platform and standard reports
Phase 1: Start by using offline segmentation and audiences in new channels > Collaborative targeting with publishers > Post-campaign analytics to evaluate impact
Phase 2: Expand Channels and Analytics > Add-on mobile and TV channels for targeting > Enhanced analytics > Expand to cookie-based targeting across online ecosystem
Other Channel Partners
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STRUCTURE: OFFLINE / ONLINE
INTEGRATION
Goal
> Bring offline marketing science to online world
Steps
> Short Term: Bring offline segmentation to online targeting
> Medium Term: Manage unstructured data and big data
> Long Term: Data Management Platform
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OFFLINE SEGMENTS TO ONLINE
SIMPLE STEPS TO CREATE VALUE
ONLINE
APPLY OFFLINE KNOWLEDGE:
Recognize current customers to take advantage of cross-sell and up-sell opportunities and suppress redundant advertising / content
Recognize previous customers and tailor messaging to reclaim them
Leverage promotional history and online browsing behavior to inform advertising / content choices
Quickly recognize offline segmentation changes and apply them to online marketing strategy
DISTRIBUTE INSIGHT:
Apply segment-level online data and insights to your offline DB to inform direct mail, email, and Collaborative Targeting marketing decisions
Leverage online content viewing knowledge to address previously unknown cross-sell opportunities
Establish coherence in messaging across channels
OPTIMIZE THROUGH TEST & LEARN:
Streamline online advertising spend through more precise targeting and minimization of wasted spend on poorly performing segments
Leverage effectiveness of precisely targeted campaigns via Collaborative Targeting into broader anonymous audiences
Increase customer base by offering the right products at the right time to induce conversions
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CROSS-CHANNEL ANALYSIS
LINKING ONLINE AND OFFLINE DATA
Segment-level
details
Individual matching, cross- channel
conversion
Number of advertiser and
publisher matches
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MANAGE BIG DATA AND
UNSTRUCTURED DATA
MANAGING YOUR AUDIENCES AND OWN
YOUR DATA ASSETS
Media Preferences
Channel Preferences
Product Propensities Just Your Audience
Anonymous Match
Customer Behavior
External Insights
Attitudes/Personas Partnership Ecosystem
Delivery Integration
Real Time Data Exchange
Match
Anonymize
Enhance Advertiser Audience
Publisher Audience
Online Display 180 MM Profiles
Mobile 86 MM Users
Social 650 MM Profiles
Email 70 MM Addresses
Call Center 73 MM Numbers
Apps
Print 144 MM Households
TV 59 MM Households
Client Client’s Safe Haven
Channel
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INSIDE THE NEW MARKETING DATABASE
ANONYMOUS, REAL-TIME PLATFORM FOR BIG DATA
Collect Anonymous consumer
engagement information
Impressions Email Opens
Social Search Behaviors Page Visits Partners Offline
Evaluate Anonymous management,
organization, reporting, scoring and segmentation
Online ID – Ab32LK2 > Served gold card ad on 11/22/10 > Searched on site for travel rewards > Visited platinum card page 11/17/10 > In-market luxury car > Gold cardholder for 5 Years > Received platinum card DM 11/15 > Female with small children
Your Integrated User Data
BANK DATA
Big Data
Real-Time Automation
Recognition
Analytics
Distribute Consumer insights and targeted segments to
consumer engagement points
Targeting and Personalization
DSP Product Recommendations
Site Personalization SSP Media Buy Platforms
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DATA MANAGEMENT PLATFORM
(DMP)
WHAT IS A DATA MANAGEMENT
PLATFORM?
> A DMP is an anonymous, real-time centralized platform that enables marketers with the ability to: • Capture or load a variety of data inputs • Clean and process that data • Segment and score that data • Distribute that information across the digital ecosystem
What Makes Acxiom DMP World Class?
> A DMP by itself is just one piece of the puzzle. It must work in concert with online and offline solutions to address broader needs and requirements: • Address the more varied and complex privacy requirements of data from
across online and offline channels • Combine both offline and online data into one view of the customer • Manage for the brand’s benefit with no conflicts of interest • Leave brands in control of their data, who accesses it and where it goes
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EVOLVING TO ENTERPRISE DATA
MANAGEMENT
Marketing Database(s)
Marketing – PII based Assets where personally identifiable information can and is freely stored
Real-time Anonymous Platform
Safe Haven – PII based Where PII is shared with Acxiom but not
between the contributors
Safe Haven > File matching > Campaign history > Standard reporting – Cross-
channel > Acxiom controlled
Analytic Environment
> Data Integration > Model & segment development > Cross-channel analysis > Media mix optimization
Anonymous All data is anonymous. No PII or IDs
associated with PII are stored
> Customer and/or prospect > Campaign management > Response information > Reporting
> Execution oriented > Audience creation & tracking > Big Data Integration > Standard reporting
Safe Haven Analytic Environment
> Counts > Campaign analysis > Publisher segment level
reporting
Anonymous Analytic Environment
> Modeling & segmentation > Standard aggregations &
tools > Custom insights
All-C
han
ne
l P
riva
cy-C
om
plia
nt
Recognition Data
70
THE LAYERS OF DMP FUNCTIONALITY
71
MARKETING ROI
EASY MONEY
Personalized Experiences
Concentrate Ad Spend
Connect Web / Outbound
Connect Print / Digital
Connect Call Ctr / Digital
Connect Mobile / Email
Connect TV / Offline
4-5x
3-5x
2x
4x
3-5x
7.5x
17x
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STRUCTURE: MARKETING ROI
Goal
> Continuous improvement in marketing ROI
Steps
> Short Term: Campaign-level ROI measurement – customer value, test vs. control, A/B testing
> Medium Term: Cross-channel attribution
> Long Term: Marketing mix optimization
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CAMPAIGN-LEVEL ROI
MEASUREMENT
AS ALWAYS, BETTER ROI STARTS WITH
SEGMENTS
> Comprehensive segment analysis that reveals key micro-opportunities within the data
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Propensity Models
Segment Analytics
Life Stage Segments
Predictive Marketing
(Events / Triggers)
Channel Preference
Safe Haven
Direct Mail
Non-Addressable Emerging Channels
Outbound Phone
Addressable Phone
Addressable Digital
Addressable Cable
EIGHT STEPS TO DRIVING BETTER
CAMPAIGN RETURNS
1. Opportunity Identification & Sizing
2. Channel Reach 3. Targeting Methodology
4. Messaging Grid
5. Test & Design Plan 6. Measurement 7. Learning Agenda 8. Opportunity Prioritization
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CROSS-CHANNEL ATTRIBUTION
THE TRADITIONAL MARKETING FUNNEL
IS DEAD
Just when we thought we had it figured out…
…the marketing environment has changed dramatically
Aware
Prefer
Consider
Purchase
OUTCOME
APPLY
WAIT
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MARKETING CHANNEL FRAMEWORK
Intent Creation
Risk Assessment
Acquisition
Cross-Sell & Up-Sell Retention
Retirement
Win Back
Prospect
LIFECYCLE MARKETING
Reach the right person at the right place at the right time
By understanding the interplay between the right channels
Lead
Customer
Loyalty
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Call Center
Web Retail
Marketing Database
Leads Database
Demographics, Account &
Attribute Data Audit, Cleanse & De-Dupe
Score, Segment & Rank
Unqualified or Low Priority
Leads
Leads Distribution Solution
Extract Cold
Leads
Sales People
Leads Database
Performance Reporting
Lead Generation
Lead Creation
Lead Capture
Lead Validation
Lead Grading
Lead Distribution
Lead Nurturing
Sales Contact
Sales Result
LEADS DATABASE ENABLES X-CHANNEL
ATTRIBUTION AT ACQUISITION
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ANALYTIC ASSET MANAGEMENT
INTERACTIONS, RESPONSES & SALES
AGENCY SERVICES
FULL ATTRIBUTION ASSIGNS VALUE TO
EACH MARKETING INTERACTION
ENTERPRISE CROSS-CHANNEL
MARKETING DATABASE
FULF
ILLM
ENT
& D
ELIV
ERY
PLA
TFO
RM
S
Production Analytics
Campaign Management
CU
STO
MER
INSI
GH
T D
ATA
DISCOVERY ANALYTICS
PERFORMANCE ANALYTICS
Loyalty Management
Customer Marketing
Prospect Marketing
BUSINESS & ORGANIZATIONAL ALIGNMENT STRATEGY
Direct Mail
Outbound Telemarketing
Mobile Messaging
Retail Point of Sale
Email Home Page
Search Engines
RSS Feeds
Smart Phone Apps
Targeted TV
Broadcast TV
Targeted Display Ads
Retargeted Display Ads
Un-Targeted Display Ads
Social Networks
Inbound Telemarketing
Outdoor
Radio
Leads Management
CU
STO
MER
DA
TA IN
TEG
RA
TIO
N
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MARKETING MIX OPTIMIZATION
THE NEW FACE OF MARKETING MIX
“SimCity for CMOs”
> Fast, objective simulations of consumer response to marketing plans and “what if” scenarios. Advantage of forward-planning that regression modeling CANNOT do
> Innovative technology uses demographic, market, consumer behavior, and your in-house data to accurately forecast sales and ROI
> More than just “Media Mix”… informs decisions on all four P’s of Marketing!
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TEST AND IDENTIFY NEW CHANNELS
NOT TRIED BEFORE
> Simulation technology enables quick, low-cost testing of new or different marketing tactics
2012 Original 2012 Add Mobile % Change
Total Units (‘000s) 36,928 38,109 3%
Digital 22%
Mass Media 67%
Promotions 11%
Digital 22%
Mass Media 61%
Promotions 11%
Mobile 6%
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OPTIMIZE FUTURE MARKETING PLANS
> Obtain accurate sales forecasts based on various “what if scenarios” by varying spend levels, timing, mix of tactics and consumer targets
2011
Spend $300 MM
170
176
167
178
183
Un
its
(MM
)
2012 +3% vs. 2011
Shift From Print
& Increase Promotions
+3.7% +4.7%
+7.8%
-1.6%
2013 Plan Simulation
2012 +3% vs. 2011
No TV
Rebalance & Add PR
2012 +3% vs. 2011
Moms with Kids
Heavy-Up & Reduce Events
2012 +3% vs. 2011
Add Mobile
Advertising & Heavy Digital
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BUILD A BUSINESS CASE FOR
MARKETING SPEND
> See the future impact on connections based upon proposed marketing changes and “what if” scenarios via simulation
> Solve for optimal spending levels today and in the future
87
CONCLUSION
BANK MARKETING AT A PIVOT POINT
> Budget constraints must drive new thinking, capabilities and actions
> Big data and analytics will become increasingly important to delivering the customer experience as customers expect 1:1 treatment
> Better data infrastructure and analytics provide the fuel to increase MROI and provide a great customer experience
> Bank CMOs cannot do it alone – lack of resources (time / talent) and highly specialized analytics mean that they require strong partners
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© 2013 Acxiom Corporation. All Rights Reserved.
THANK YOU.
Stephen Drees [email protected] Marc Trudeau [email protected]