Ahead of the Curve
By Lisa Yorgey Lester
Technology has been the biggest catalyst of change to the direct marketing industry. The introduction of the personal computer has enabled marketers to process large quantities of data and thereby maximize the advantages of direct marketing. Data analytics, marketing automation and optimization technologies not only give marketers unprecedented access to data, but allow them to manage and manipulate it. They've been able to market more efficiently and smarter as a result.
Marketers can better leverage their customer information and campaign histories to make more relevant offers to customers and prospects. Here's a look at some of the technologies that can help marketers achieve this goal.
The growth of multichannel marketing is driving the use of marketing automation technology. These tools improve and automate workflow within marketing, and include marketing resource management, digital asset management and campaign-management applications.
At Ambrosi, a Georgia-based direct marketing agency, Vice President of Strategic Planning Paul Marobella says he's seeing a growing demand for process workflow and content-management applications, particularly as more marketers use multiple channels. Managing digital assets is critical to managing brand consistency across channels, says Marobella, adding that as more channels are added to the marketing mix, more departments touch each campaign. "This is where technology, such as online approval of creative, can streamline workflow," he adds, particularly if all people involved in the approval process are not in the same physical location.
A streamlined or automated workflow allows marketers to spend more of their time contemplating marketing strategy, observes Richard Muller, executive vice president of consulting and analytics for KnowledgeBase Marketing, a Texas-based integrated marketing- and CRM-solutions provider.
"Using content that is based on what you know about [a customer] as an individual, not a segment … that is the Holy Grail," says Greg Gianforte, founder and CEO of RightNow Technologies, a customer service and support solutions company based in Montana.
While most companies have this information, Gianforte says many do not have access to it. "The primary repository is the department with the most frequent contact with customers—that is the customer service center," he explains.
To gain access to this wealth of information, direct marketers need to integrate or create a common record of all of a customer's interactions, regardless of channel. Then, using analytic tools, marketers can mine these customer records to uncover opportunities for communications. "That's what gives you the right to communicate with a customer," says Gianforte.
Even more important, he notes, is to link any new data gained from a customer interaction back to the existing customer record. Gianforte says it's easy to export data from one application, import it into another, and send a campaign. "But rarely does a link exist for new data generated from the campaign," he says. "Too often, new data is housed in a separate system in the marketing department."
Muller says he's seen a trend inside organizations to move information at an enterprise level to support these interactions. "This sharing of information across the enterprise is the next iteration of CRM," says Muller.
Collectively referred to as optimization technologies, contact management and real-time applications blend marketing intelligence with predetermined actions across the whole of an organization. This enables marketers to more quickly and effectively respond to information, regardless of the channel used to communicate.
This sharing of information also helps marketers better manage what offers a customer receives and when.
1. Contact management software
According to Eric Schmitt, a senior analyst at Forrester Research, an independent technology research company based in Cambridge, MA, this type of application can aid marketers in determining the best possible time within a specified window to target a customer. It is particularly helpful for marketers who might send multiple campaigns to one customer, such as a financial services mailer. Rather than diluting the effectiveness of any one offer by saturating a customer with several mailings within a period of time, contact management software can help marketers decide which offer is the best based on eligibility and probability, says Schmitt.
Taking this a step further, he notes, is the optimization of communication across all channels, so it is cross-functional. For example, says Schmitt, do you make an offer to a customer who has defaulted on payments? Or, what type of offer should you send a customer who may have recently registered a complaint with the customer service center? "This is part of the promise of CRM," explains Schmitt.
2. Real-Time Applications
A key piece of the marketing equation that has for the most part remained elusive is when to market, points out Muller, who anticipates leading technology vendors will start working on this part of the equation.
Event- or trigger-based marketing tools initiate contact with a customer according to predetermined business rules, and are becoming more sophisticated and complicated. Muller says he sees more marketers moving to embed these technologies within their current infrastructure to turn opportunities into sales. For example, say a customer has purchased a specific product on a monthly basis. A month goes by and no purchase is made. This period of inactivity triggers an e-mail message to the customer that may promote a special offer, or simply remind him that his product supply may be running low.
Real-time decisioning is an automated system that compares incoming data with predefined business rules or decision strategies to determine a rapid response, while interacting with that customer. This enables marketers to determine the optimal offer for each individual based on a combination of demographics, sales history and behavior.
Schmitt provides an example of how the technology works: A customer initiates contact with the customer service center. The marketer now has an opportunity to make the best offer using information it currently has about the customer in its database, as well as the information it is gaining during the actual transaction in the call center. A real-time decisioning system will feed the call center rep the most appropriate offer for that specific individual from a pool of offers, as determined by pre-set business rules.
A bank customer who recently made a large deposit, for instance, might look like a good candidate for a mutual fund. However, the call center rep learns during a call that the customer plans to purchase a home. This information is fed into the system, and indicates to the rep that she should ask if the customer would like to hear about a mortgage offer.
As time progresses, explains Schmitt, "the offers that get the best response may be offered more frequently, depending on whether the goal is to increase response or profit."
Marketers are becoming more dependent on these rapidly evolving technologies. Says Schmitt: "Direct marketing is becoming more of a left-brain exercise. It's becoming more analytic, quantitative and measurable."
To read about some of the extraordinary new technology features in marketing, go to Technology Roundup: Products on the Cutting Edge. This article has been expanded to include even more meaty technology-driven initiatives.
For more on wireless communications, read Go Mobile: Marketing Takes to the Wireless Web.