Database: The Missing Link
CRM systems need analytical help to support direct marketing activities
August 2007 By Bill Singleton
Does your marketing execution pursue strategy or tactics? Do you have the tools to help you pursue both to success? First you must know the difference between strategy and tactics. Strategy: the grand design, the plan for obtaining a specific goal, such as learning how to sell trucks. Tactics: a set of actions, devices or methods in service of the strategy, such as each day’s coursework in a sales class about how to sell trucks.
The Goal
The most effective marketers focus successively on their strategy and their tactics. Accomplishing this ideal approach requires the development and execution of a strategy through the well-organized and efficientperformance of intricate sets of tactical actions in phone, e-mail, online, viral and direct mail campaigns. The mechanics of such a performance are greatly supported by good marketing tools that accommodate customer database management, linked to advertising planning, accounting and distribution systems for outputting the instructions and materials. Highly touted tools include enterprise resource planning (ERP) systems’ CRM modules, with their grasp of the enterprise’s divisions, and marketing analytics modules to analyze customer activity and execute promotional plans.
The Problem
In the recent past, several companies with big ERP and CRM systems asked me to help them understand their customers for direct marketing purposes. When I looked into their customer data management systems, I was impressed with the sophisticated links they had to other company areas to support comprehensive and efficient reporting of inventory, orders and sales, shipments, and the history of the customers’ activities. These systems—for example, SAP/CRM and Oracle/Siebel/CRM—enabled the firms to input, sell to and organize their customers in a variety of account and contact structures.
So, why did they ask me for help? They asked because the analytics software did not let the firms perform the direct marketing analyses and strategic planning activities they felt they needed to plan and conduct marketing their way.
Put another way, the direct marketers at these companies knew that they needed to plan strategically, but they could not manipulate the customer buying information within the CRM systems to take a strategic rather than a tactical view of their customers. They wanted to perform data transformation and simple profiling steps to create or identify the variables that determined the buying behavior of their customers. The CRM systems only could present them with the operational data: order number, date, item at cost and retail, address, payment terms, and a keycode or campaign code captured during the transaction. They could not look at customer demographics, lifetime value or the customers’ successive responses to multiple promotions. They wanted to create a long baseline recency, frequency and monetary value (RFM) model, or use other statistical tools that these marketers were accustomed to accessing. So, they needed another point of view and the data access to take these steps.
The Goal
The most effective marketers focus successively on their strategy and their tactics. Accomplishing this ideal approach requires the development and execution of a strategy through the well-organized and efficientperformance of intricate sets of tactical actions in phone, e-mail, online, viral and direct mail campaigns. The mechanics of such a performance are greatly supported by good marketing tools that accommodate customer database management, linked to advertising planning, accounting and distribution systems for outputting the instructions and materials. Highly touted tools include enterprise resource planning (ERP) systems’ CRM modules, with their grasp of the enterprise’s divisions, and marketing analytics modules to analyze customer activity and execute promotional plans.
The Problem
In the recent past, several companies with big ERP and CRM systems asked me to help them understand their customers for direct marketing purposes. When I looked into their customer data management systems, I was impressed with the sophisticated links they had to other company areas to support comprehensive and efficient reporting of inventory, orders and sales, shipments, and the history of the customers’ activities. These systems—for example, SAP/CRM and Oracle/Siebel/CRM—enabled the firms to input, sell to and organize their customers in a variety of account and contact structures.
So, why did they ask me for help? They asked because the analytics software did not let the firms perform the direct marketing analyses and strategic planning activities they felt they needed to plan and conduct marketing their way.
Put another way, the direct marketers at these companies knew that they needed to plan strategically, but they could not manipulate the customer buying information within the CRM systems to take a strategic rather than a tactical view of their customers. They wanted to perform data transformation and simple profiling steps to create or identify the variables that determined the buying behavior of their customers. The CRM systems only could present them with the operational data: order number, date, item at cost and retail, address, payment terms, and a keycode or campaign code captured during the transaction. They could not look at customer demographics, lifetime value or the customers’ successive responses to multiple promotions. They wanted to create a long baseline recency, frequency and monetary value (RFM) model, or use other statistical tools that these marketers were accustomed to accessing. So, they needed another point of view and the data access to take these steps.
The Business of Database Marketing
