Marketing has evolved - thankfully - from the days when everyone just thought of us as the brochures and tradeshows people. Nowadays, we're as likely to be focused on creating digital content that's worth sharing as we are putting a tradeshow sponsorship together, but all of it is data-driven.
So what does it really mean for marketing to be data-driven? And how does marketing turn data "magically" into profits? In the spirit of full disclosure, it's not magical in an abracadabra or Harry Potter sort of way, and it's not entirely mystical in a crystal ball sort of way. But the results can indeed be magical and quite profitable. And the best
magician marketer I can think of to illustrate that point is Jim Foreman, most recently Director of Analytics and Customer Insight at Staples Corp.
Jim spoke recently at a DMA Annual Conference and provided some good, specific examples of how to turn customer insight into profit with analytically-driven marketing automation. So once you collect the customer data and apply the analytics and start getting the insights, what can you actually do with it? That's what Jim delved into and I'm happy to share with you here.
Very simply - the magic starts when you begin to launch successful campaigns. Per Jim, SAS Marketing Automation software "takes all of the good work that our analysts are doing for us – descriptive work, segmentation, modeling – and it lets us bring that right into a campaign, on the fly if we want to." To illustrate his point, he detailed three types of campaigns he led at Staples to great success:
- Attrition campaigns:
Find predictors of existing customers' likely attrition and design campaigns to proactively address those factors.
- Browsed-and-abandoned campaigns:
Identify the online behaviors of new potential customers that lead to abandoned shopping carts and have responses at the ready.
- Trigger campaigns:
Provide suggestions to consumers who may not realize they need something additional to give the end result they want (i.e. a specific type of paper for the printer ink they want to buy).
Once you have your successful campaigns in place and operational, then there are five final steps to take to get to profitability:
- Identify critical metrics.
- Use decile analysis.
- Profile the top 10% of customers.
- Test the offers, segments and campaigns.
- Do incremental analysis - refine and retest.
Each of those five final steps are detailed in the paper, How to Turn Customer Insight into Profit with Marketing Analytics. It's an interesting read that includes many practical guidelines from a master data-driven marketer, and some of Jim's more colorful anecdotes, such as whether marketers may have anything in common with blind squirrels. Let me know what you think.