How Kmart knows you’re pregnant before your family does

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This is a fascinating insight into the state of the art in triggered and reactive marketing. In a longish, but very good article, the New York Times provides some great case study material on how Target in the US identifies and targets, no pun intended, women who are pregnant BEFORE they buy any pregnancy related goods or services. With this head start on the competition they are able to generate excellent returns on their marketing.

Do you know any companies working at this level of sophistication? Let me know.

Here is the full article: How Companies Learn Your Secrets

Filed Under: Customer Analytics, Customer Strategy, Marketing Automation, Trigger Marketing

Do Your Customer Experience Initiatives Have These Flaws?

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defective_chain

It seems to me that many customer experience initiatives are deeply flawed. They start out well intentioned but lack the right process improvement mindset to drive long term change.

The customer experience strategy that seems to be best practice at the moment is:

  1. Do some research on what people want: ask a focus group, run a survey, etc,
  2. Design “the best” customer experience based on the research.
  3. Test it in a limited way –asking people what they think, doing some usability testing (i.e. watching what people actually do either actually or via analytics) of your systems.
  4. Roll-it out.
  5. Relax

The critical part is that the design process (steps 1 and 2)  is run only once. Then, having agreed that it is perfect, just let it run. This is wrong. [Read more...]

Filed Under: Customer Analytics, Customer Experience Management, Customer Strategy, Net Promoter Score Tagged With:

Forecasting customer value when you don’t have a contract: Discrete transactions

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hardie_non_contract_continuous

This post is one in a series in which I summarize into actionable steps parts of the substantial body of work by Peter Fader, Bruce Hardie, et. al. in the analysis of customer bases. The relevant source papers are referenced at the end of the post.

In this post, we will focus on the bottom left quadrant of the Fader/Hardie customer relationship map (as I will refer to it). We will be examining situations where there is no on-going contract between the supplier and the customer and where the customer can only purchase at discrete time intervals.

Source: See reference 3.

[Read more...]

Filed Under: Customer Analytics, Customer Retention, Customer Strategy

Calculating Retail Sales Forecasts, Customer Life Time Value, and other customer variables

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hardie_non_contract_continuous

This post is one in a series in which I attempt to summarize into actionable steps parts of the substantial body of work by Peter Fader, Bruce Hardie, et. al. in the analysis of customer bases. The relevant source papers are referenced at the end of the post. The details of the statistical models are deliberately excluded from this summary but can be reference in the source papers.

In this post, we will focus on the top left quadrant of the Fader/Hardie customer relationship map (as I will refer to it) . [Read more...]

Filed Under: Customer Analytics, Customer Retention, Customer Strategy

4 Practical Approaches to Calculating Customer Lifetime Value

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classifying-customer-bases

Recently, I came across a very useful Marketing Science article on customer lifetime value calculations. “Customer Base Analysis in a Discrete-Time Non-contractual setting,” presents an excellent and accessible way of answering the difficult question of customer lifetime value when no ongoing contractual relationship exists.

The paper itself was enlightening. Unfortunately, as is often the case with academic papers, the key business insights are hidden from plain sight behind a rather dense, high order, statistics heavy paper. I am sure their findings are as clear as glass to the authors. However, for me, I needed some time to unpack the content, understand it, and work out how to apply it for my customers. [Read more...]

Filed Under: Customer Analytics, Customer Retention, Customer Strategy, Loyalty Management

Customer Retention: You already have enough segmentation, take action!

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datadrivenmarketingstrategies

Think quick: to drive customer retention, should you focus on a deeper understanding of your customer segmentation or take action with the data that you already have?

If you said segment your customer data base with greater accuracy, you probably picked the wrong answer. According to research by Aberdeen Group (“How the Best in class use customer data to boost retention revenue in 2010″) best in class organizations focus on “doing” more than they do on analyzing. This certainly has the ring of truth based on my experience. [Read more...]

Filed Under: Customer Analytics, Customer Experience Management, Customer Retention, Customer Strategy Tagged With: , , ,

Refer a friend programs: are they worth it?

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customer-referral-programs-margin

Refer a friend programs: are they worth it?  Yes, as it happens they are and some very recent research gives us the numbers to back it up.

Referral Programs and Customer Value was recently published by Schmitt, Skiera and Van den Boulte.  In this excellent paper, rigorous analysis was applied to a topic of discussion by marketers the world over: do ‘refer a friend’ programs make money?

Their findings: customers acquired through paid customer referral programs have a higher retention rate and higher initial contribution margin than other customers.  In other words, yes they do work. [Read more...]

Filed Under: Customer Analytics, Customer Strategy, Loyalty Management Tagged With: , ,

An introduction to Customer Life Time Value (LTV) and Loyalty Marketing for SMEs

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Dominos

We recently participated in a written interview for the SME magazine of one of our major Australian banks. The article was not all about us, so some of the input was edited to meet space restrictions. And we are posting the transcript here for those of you interested in Customer Lifetime Value and loyalty programs.

It is best that the original Q&A structure is retained as seen below. [Read more...]

Filed Under: Customer Analytics, Customer Retention, Customer Strategy Tagged With: , , , , , ,

Are you using campaign lead or customer lead marketing?

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campaignlead

This week I’m going to build on a recent post (“Why customer segmentation is not customer strategy”) by looking at a new approach to creating a customer strategy.

We will start by examining how most marketing departments use customer segmentation.  Over the past 10-15 years, an evolution, a good evolution mind you, has overtaken marketing organisations.  In that time, there has been an increased focus on maximizing the return on marketing investment. [Read more...]

Filed Under: Customer Analytics, Customer Strategy, Marketing Automation Tagged With: , ,

The 10 major marketing themes in 2000: still relevant?

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Old-style-gold-compass

Every now and then, I like to go back and read past work from the giants of our craft. And Philip Kotler certainly qualifies as a good set of shoulders for us to stand on so we can see further. In 2000, Mr. Kotler published “Marketing Management, Millennium Edition” (2000, Prentice Hall) and given the occasion, he looked forward and predicted the issues that Marketing would be dealing with in the new century.

More than a decade into the 2000′s, I can say I think he was correct. He may despair that we are still to resolve the issues, but he was correct in identifying the major tasks in what we have (un-poetically perhaps) called ‘do marketing’. [Read more...]

Filed Under: Business Strategy, Customer Analytics, Customer Strategy, Marketing Automation Tagged With:
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