Customer Delight = Customer Expectation plus 1.
This was the simple formula for delighting your customers. For me this is a great formula, but in itself it also raises a number of questions. For example, to deliver a plus one, to exceed something, you must know what that something is in the first place… so do you? Do you know what your customer expectations are at each moment of contact? Most companies believe that they know, but can they show evidence, no! They perhaps show a survey they conducted over 10 years ago and say “I’m sure it’s the same now”!
If you want a clue as to what your customers expectations are then just listen to the words they use. Customers say, “I didn’t expect to be treated in that way”. People use the word expect a great deal……..when they do they are referring to their inner expectations………which they then use to measure your performance against those expectations.
If I ask you to close your eyes and think of landing in an airport in a foreign country you have never visited before. Look around and tell me what it is like and how you feel. You begin to tell
me, feeling anxious, confused, concerned and worried as you have landed in a foreign country and are not certain what to do and where to go, you are defensive. What are you describing here?…..You are describing emotions, you are describing their emotional expectations, you are describing how you EXPECT to feel.
Therefore I think that there are two forms of expectation, physical expectations, i.e. how quickly a product will be delivered, how many rings it will take to answer the phone and emotional expectations, what people EXPECT to feel. If you are to meet your customer expectations you need to understand both! So do you?
Do you know what your customers’ physical and emotional expectations are? When they come into your store? Or when your salesman calls around? Or when you put them through 7 layers of voice menu systems? ……And if you don’t, how in the hell do you expect to meet, let alone exceed, those expectations?
So what are emotional expectations? Let me give you an example. The other day I walked into a store and the woman was stacking bags behind the check out. As I stood in front of her she totally ignored me. I thought, how rude! I was hurt, I felt snubbed. My emotional expectation was that she would have at least acknowledged me; asked me to wait a moment, but no she chose to ignore me.….…another example, last week I brought something from a store and it stopped working. I decided to take it back. I was expecting a row. I emotionally prepared myself for an argument; I had played it out in my mind; what they were going to say and how I would respond. The person behind the counter couldn’t have been nicer and more apologetic. They replaced the item without question. That exceeded my emotional expectations.
My advice for this month is to find out what your customer emotional expectations are. It is only when you understand them that you and your organisation can set about planning how to achieve or exceed them. Without this understanding you are leaving it to chance!
The Data Dilemma
Generating more data, but enjoying it less? According to a recent study released by Forrester Research entitled, "Turning Data Into Dollars," you're not alone. Companies have spent millions on analytical software, only to find that it fails to produce the kind of timely insight they want. After surveying 50 business executives at large enterprises, Forrester said it is time for companies to realize analytics is an area where getting outside expertise is not only warranted, but critical to producing cost-effective decisions.
The Analytical Stone Age
Despite the years and millions spent, Forrester said most firms remain in the analytical Stone Age for several reasons. The biggest problem is speed. Many analytical architectures were built to move megabytes of data weekly or monthly and cannot handle new Web-driven, real-time demands or data volume.
Those architectures are also too rigid and too complex, resulting in answers to questions that are no longer relevant, and complexity that has moved beyond users' ability to comprehend.
Ultimately, the problems go back to companies buying and running their own analytical software, an approach that initially seemed both prudent and cost-effective. But the speed of the Internet and the volumes of data produced quickly rendered those internally built systems obsolete because business needs and wants changed as quickly as the data did.
Making Data Pay Now
According to Forrester, data gathering is not wasted but largely misapplied. Two approaches can be used to turn things around.
In the short term, Forrester said companies should take advantage of packaged models from vendors like MicroStrategy (Nasdaq: MSTR) and Oracle (Nasdaq: ORCL) that leverage previous investments in packaged applications from such vendors as Siebel Systems (Nasdaq: SEBL) and SAP (NYSE: SAP).
Forrester also recommended, in the near term, that businesses concentrate on short-term achievable questions and results and on driving business information to the front lines.
Long Term – Who You Gonna Call?
Perhaps the most telling result in the study is Forrester's determination that few firms have the in-house expertise to run their own analytics.
"Finding and retaining the right staff for the long term will break the bank at most firms," Forrester concluded.
For that reason, Forrester said it thinks smart firms will seek help from two different types of outside service providers -– analytics consultants and analytics outsourcers.
The decision on where to turn should hinge on one central factor: industry expertise.
"Let's face it: Different industries require different analytical expertise. As a result, companies should ask up front about the prospective consultants' experience in their vertical industries -– and quickly show the door to any who can't point to a handful of reference clients," Forrester said.
Datamining Methodology
1-Business Understanding:
(Determine Business Objectives, Assess Situation, Determine Data Mining Goals, Produce Project Plan)
This initial phase focuses on understanding the project objectives and requirements from a business perspective, and then converting this knowledge into a data mining problem definition, and a preliminary project plan designed to achieve the objectives.
Data Understanding:
2-Data Preparation:
(Collect initial data, describe data, explore data, verify data quality)
This phase starts with an initial data collection and proceeds with activities in order to get familiar with the data, to identify data quality problems, to discover first insights into the data, or to detect interesting subsets to form hypotheses for hidden information.
3-Data Understanding:
(Select Data / RFM, Clean Data, Construct data, integrate data, format data)
The data preparation phase covers all activities to construct the final dataset (data that will be fed into the modeling tool) from the initial raw data. Data preparation tasks are likely to be performed multiple times, and not in any prescribed order. Tasks include table, record, and attribute selection, data cleaning, construction of new attributes, and transformation of data for modeling tools.
4-Modelling:
(Select Modeling Technique, Generate Test Design, Build Model, Asses Model)
Starts with an initial data collection and proceeds with activities in order to get familiar with the data, to identify data quality problems, to discover first insights into the data, or to detect interesting subsets to form hypotheses for hidden information.
5-Evaluation:
(Evaluate Results, Review Process, Determine Next Steps)
Models should be evaluated from a business perspective based on cost benefit analysis and return on investment. The results of the model may show some interesting patterns but acting on them may not provide the iincremental revenue or cost savings that would justify their use. One of the simplest ways to evaluate a model is to test the results in the real world.
6-Deployment:
(Plan Deployment, Plan Monitoring, Maintanance, Produce Final Report, Review Project)
Depending on the requirements, the deployment phase can be as simple as generating a report or as complex as implementing a repeatable data mining process. In many cases it will be the user, not the data analyst, who will carry out the deployment steps. In any case, it is important to understand up front what actions will need to be carried out in order to actually make use of the created models.
(Determine Business Objectives, Assess Situation, Determine Data Mining Goals, Produce Project Plan)
This initial phase focuses on understanding the project objectives and requirements from a business perspective, and then converting this knowledge into a data mining problem definition, and a preliminary project plan designed to achieve the objectives.
Data Understanding:
2-Data Preparation:
(Collect initial data, describe data, explore data, verify data quality)
This phase starts with an initial data collection and proceeds with activities in order to get familiar with the data, to identify data quality problems, to discover first insights into the data, or to detect interesting subsets to form hypotheses for hidden information.
3-Data Understanding:
(Select Data / RFM, Clean Data, Construct data, integrate data, format data)
The data preparation phase covers all activities to construct the final dataset (data that will be fed into the modeling tool) from the initial raw data. Data preparation tasks are likely to be performed multiple times, and not in any prescribed order. Tasks include table, record, and attribute selection, data cleaning, construction of new attributes, and transformation of data for modeling tools.
4-Modelling:
(Select Modeling Technique, Generate Test Design, Build Model, Asses Model)
Starts with an initial data collection and proceeds with activities in order to get familiar with the data, to identify data quality problems, to discover first insights into the data, or to detect interesting subsets to form hypotheses for hidden information.
5-Evaluation:
(Evaluate Results, Review Process, Determine Next Steps)
Models should be evaluated from a business perspective based on cost benefit analysis and return on investment. The results of the model may show some interesting patterns but acting on them may not provide the iincremental revenue or cost savings that would justify their use. One of the simplest ways to evaluate a model is to test the results in the real world.
6-Deployment:
(Plan Deployment, Plan Monitoring, Maintanance, Produce Final Report, Review Project)
Depending on the requirements, the deployment phase can be as simple as generating a report or as complex as implementing a repeatable data mining process. In many cases it will be the user, not the data analyst, who will carry out the deployment steps. In any case, it is important to understand up front what actions will need to be carried out in order to actually make use of the created models.
Event based marketing
EBM means that automatic or manual processes with pre-defined rules and actions on particular events that customers involved in.
For example, if a valuable customer A has called your call center more than ten in one month, make a care call.
EBM is a strategic process designed to enhance the dialogue and relationship a company has with each of its customers.
• Shape how the customer interaction takes place, while the customer determines what, when, and where.
• Engage each customer based on his or her actual individual behavior and interests rather than on a product push marketing campaign or sales promotion based on a targeted segment.
• Fulfill the promise of CRM by triggering helpful interaction with each customer at the time that
customer has implicitly signaled a clear and specific need or interest.
The effectiveness of marketing campaign return decreases after the event!!
For example, if a valuable customer A has called your call center more than ten in one month, make a care call.
EBM is a strategic process designed to enhance the dialogue and relationship a company has with each of its customers.
• Shape how the customer interaction takes place, while the customer determines what, when, and where.
• Engage each customer based on his or her actual individual behavior and interests rather than on a product push marketing campaign or sales promotion based on a targeted segment.
• Fulfill the promise of CRM by triggering helpful interaction with each customer at the time that
customer has implicitly signaled a clear and specific need or interest.
The effectiveness of marketing campaign return decreases after the event!!
Word Of Mouth Marketing Techniques WOMM
Check out this SlideShare Presentation:
Typical Purchasers groups
Reactive Traditionalist:
•They make no effort to anticipate buying requirements (search over internet, watching ads),
•Relatively Price Insensitive,
•Buy Locally or by Catalogue,
•Have a formal Buying Process (watch ads, go market ..),
•No price comparison methods (logical choice of product)
•Sometimes Negotiated Prices :)
Service Oriented
•Require Distributors to take an active role in helping them manage their demand,
• Formal Buying (watching ads and then go market ..),,
• Have price comparison methods (supermarkets are cheaper, this firm sells cheapest products, looking for cheap suplementaries),
Multi-Source purchasers
• Have different suppliers(supermarkets, internet, malls) and Have price comparison methods,
• Logical buying (necessity of product and then market),
• Price and quality sensitive
Customer segmentation in 5 steps
1- Identify your best customers:
Has your organization defined “a customer”? If not, is the enterprise attempting to be all
things to all people, including those customers that it does not serve well or those with which it
suffers a loss rather than gains a profit?
Today’s most successful CRM practitioners begin at the other end of the equation – examining the needs that your most loyal customers want met when dealing with you. The starting point for this kind of analysis should be defining those customers – focusing on those who consistently give you their largest share-of-wallet, Identify their needs and concerns:
2- Identify their needs and concerns:
Your next challenge will be to refine this understanding of why these customers have chosen
yours. Which of their needs have you been particularly qualified and willing to meet?
Before you go outside to acquire this information, ask those people in your own organization who know them best, such as account managers, sales reps, and dealers.
Next, check out what’s available in industry research – for instance, from trade journals,
government sources or professional organizations in your customers’ fields.
To add true depth-of-insight to your segmentation efforts, to your identification of the Ideal
Customer, you must add the outside-in perspective. Your best sources of data will be your
customers themselves. There are a number of ways to engage customers and prospect in a
dialogue to learn why and how they buy. You can initiate ongoing two-way dialogue directly with
current customers, via such techniques as offering an inbound 800 number or a help line. Other
proven methods include establishing users groups, publishing a market-, or segment-, specific
customer newsletter and interviewing customers for articles, scheduling advertising or direct mail
with a response mechanism, querying visitors to your trade show booth, and conducting surveys
or focus groups.
But keep in mind that unless you also have a mechanism of getting all this information into your
eCRM platform (i.e., the marketing database), no single person – even the individual at the top –
will have more than a few pieces of the total jigsaw puzzle. When a player leaves, so does his
portion of the puzzle.
3- Develop Segments based on customer needs:
Critical to effective segmentation is making each segment as unlike any other as possible and that segments must be actionable and understandable.
4- Validate your segments:
Via market researchs and targeted campaign responses rates try to validate your segments working or not.
5- Allocate your marketing resources in proportion to potential return:
Unless you’re ready and able to use the results of all this effort to alter your marketing strategy,
your money is probably better spent elsewhere. Segmentation is not designed to be an intellectual exercise. It pays off only if you then apply it to fine-tune your marketing program. At this point, allocating resources in the use of this segments becomes an importans issue.
Has your organization defined “a customer”? If not, is the enterprise attempting to be all
things to all people, including those customers that it does not serve well or those with which it
suffers a loss rather than gains a profit?
Today’s most successful CRM practitioners begin at the other end of the equation – examining the needs that your most loyal customers want met when dealing with you. The starting point for this kind of analysis should be defining those customers – focusing on those who consistently give you their largest share-of-wallet, Identify their needs and concerns:
2- Identify their needs and concerns:
Your next challenge will be to refine this understanding of why these customers have chosen
yours. Which of their needs have you been particularly qualified and willing to meet?
Before you go outside to acquire this information, ask those people in your own organization who know them best, such as account managers, sales reps, and dealers.
Next, check out what’s available in industry research – for instance, from trade journals,
government sources or professional organizations in your customers’ fields.
To add true depth-of-insight to your segmentation efforts, to your identification of the Ideal
Customer, you must add the outside-in perspective. Your best sources of data will be your
customers themselves. There are a number of ways to engage customers and prospect in a
dialogue to learn why and how they buy. You can initiate ongoing two-way dialogue directly with
current customers, via such techniques as offering an inbound 800 number or a help line. Other
proven methods include establishing users groups, publishing a market-, or segment-, specific
customer newsletter and interviewing customers for articles, scheduling advertising or direct mail
with a response mechanism, querying visitors to your trade show booth, and conducting surveys
or focus groups.
But keep in mind that unless you also have a mechanism of getting all this information into your
eCRM platform (i.e., the marketing database), no single person – even the individual at the top –
will have more than a few pieces of the total jigsaw puzzle. When a player leaves, so does his
portion of the puzzle.
3- Develop Segments based on customer needs:
Critical to effective segmentation is making each segment as unlike any other as possible and that segments must be actionable and understandable.
4- Validate your segments:
Via market researchs and targeted campaign responses rates try to validate your segments working or not.
5- Allocate your marketing resources in proportion to potential return:
Unless you’re ready and able to use the results of all this effort to alter your marketing strategy,
your money is probably better spent elsewhere. Segmentation is not designed to be an intellectual exercise. It pays off only if you then apply it to fine-tune your marketing program. At this point, allocating resources in the use of this segments becomes an importans issue.
Five Crazy Rules for CRM Project Success
“Breaking” the software, using bad data, not communicating internally, sending consultants on vacation and spending money on nothing are actually critical to the success of your CRM project.
1. Don’t communicate: Scope creep is the bane of CRM initiatives. Start it simple and grow it later. Successful CRM initiatives earn wide deployment by proving their value in targeted pilot projects with a few clear goals and stakeholders.
2. Use bad data:Data will never be totally accurate and complete. Refine it over time. Attempts at reconciling data cause some enterprises to become too hesitant to move
beyond the data warehousing stage of their CRM implementation.
3. Break the software:If you don’t find its limits when you want to, its limits will find you when you don’t want them to. Even if a project has advanced, it remains important to know where the weaknesses lie. Therefore, an important early stage of any deployment is to test the system to destruction based on a variety of parameters (more users, more interactions, more
customers, more data).
4. Spend money on nothing: Then your project goes overbudget, don’t cut training and consulting. Enterprises must therefore ensure that their spending on intangibles (such as training, process re-engineering, internal marketing and end-user support) is “ring-fenced,”
so that when everything else goes over budget, this funding remains available to ensure the final, most critical phase of the project is carried out.
5. Send the consultants:They are there to train your people, not replace them. Enterprises must therefore ensure that their spending on intangibles (such as training, process re-engineering, internal marketing and end-user support) is “ring-fenced,” so that when everything else goes over budget, this funding remains available to ensure the final, most critical phase of the project is carried out.
1. Don’t communicate: Scope creep is the bane of CRM initiatives. Start it simple and grow it later. Successful CRM initiatives earn wide deployment by proving their value in targeted pilot projects with a few clear goals and stakeholders.
2. Use bad data:Data will never be totally accurate and complete. Refine it over time. Attempts at reconciling data cause some enterprises to become too hesitant to move
beyond the data warehousing stage of their CRM implementation.
3. Break the software:If you don’t find its limits when you want to, its limits will find you when you don’t want them to. Even if a project has advanced, it remains important to know where the weaknesses lie. Therefore, an important early stage of any deployment is to test the system to destruction based on a variety of parameters (more users, more interactions, more
customers, more data).
4. Spend money on nothing: Then your project goes overbudget, don’t cut training and consulting. Enterprises must therefore ensure that their spending on intangibles (such as training, process re-engineering, internal marketing and end-user support) is “ring-fenced,”
so that when everything else goes over budget, this funding remains available to ensure the final, most critical phase of the project is carried out.
5. Send the consultants:They are there to train your people, not replace them. Enterprises must therefore ensure that their spending on intangibles (such as training, process re-engineering, internal marketing and end-user support) is “ring-fenced,” so that when everything else goes over budget, this funding remains available to ensure the final, most critical phase of the project is carried out.
4 Example of unsuccesful customer management
Agressive Selling Example: A company sets customer acquisition as a goal. Experience shows that discounted transactions bring in new customers. Over a period of four years, they aggressively promote acquisitions through discounts. In Year 4 they realize that, while they have succeeded in acquiring many new customers, their profits are seriously eroded by the discounts. They decide to eliminate all discounts. In Year 5 they end up with fewer real customers than they had in the first place. Discounting, in other words, is a serious trap. You educate the customer to think only about price, and not about the quality and services provided by the institution. The image of the bank, for example, is one of cheap discounts, rather than personal attention to its customers. All products suffer.
Customer Quality Dilemma Example: In another example of similar problem, the restaurant manager of a large hotel notices that few people are eating in the restaurant on Wednesday nights. He decides to pep things up. On Wednesday nights, he brings in magicians, Mexican bands, belly dancers. He attracts a large crowd of locals who come for the excitement. Meanwhile, the regular businessmen who are the life blood of the hotel’s business find that they cannot conduct business in the restaurant on Wednesday nights. They decide to move to a quieter hotel elsewhere in town. The restaurant manager’s program has certainly increased traffic in the middle of the week, but what has it done for the hotel’s profitability? What has happened to the loyalty of its business customers? Who is managing the customers?
Customer Quality Dilemma Example: In another example of similar problem, the restaurant manager of a large hotel notices that few people are eating in the restaurant on Wednesday nights. He decides to pep things up. On Wednesday nights, he brings in magicians, Mexican bands, belly dancers. He attracts a large crowd of locals who come for the excitement. Meanwhile, the regular businessmen who are the life blood of the hotel’s business find that they cannot conduct business in the restaurant on Wednesday nights. They decide to move to a quieter hotel elsewhere in town. The restaurant manager’s program has certainly increased traffic in the middle of the week, but what has it done for the hotel’s profitability? What has happened to the loyalty of its business customers? Who is managing the customers?Lack of Share of Spending Vision: In another situation, a business to business customer manager sets a goal of customer retention. He succeeds: he doesn’t lose customers, and those that he retains do not decrease their spending. This may seem like success, until one looks at what has happened to these customers. The business of the customers may have been growing by 30% per year, but the company’s sales to these customers has not increased. By standing still, the company has been falling behind. In other words, the proper measurement is share of wallet, not spending level. To know what our share of wallet is, we must have some information about the size of the wallet. We have to understand our customer’s business to understand our own business.
File Fatique: A final example may illustrate the dangers of failure to manage the customers. Here is a company that aggressively promotes its customers. Visualize a company like the Reader’s Digest that has more than one hundred different products that it wants to promote to its existing customer base. Experience has shown, let us say, that single product promotions for this type of situation, are more successful than catalogs with scores of different products. There are not enough weeks in the year to accommodate 100 products with single item promotion? The company surveys its customers to determine their interests. They find out which customers are interested in children’s products, which like romance reading, which like current affairs, etc. This is good. It is segmentation along interest lines. But then they make a major mistake. Of course, some customers have checked more than one category of interest. Some check as many as ten! Having created these segments, they begin to promote them aggressively. The manager of each category promotes like mad, trying to increase profits in the area of his responsibility. Some customers get one letter a month. Frequent responders get four or five a week!
The result is what we call "file fatigue". Your best customers are worn down under a deluge of mail. You have worn out your welcome. Each of the segment managers says, "I didn’t over-promote. I never sent more than one a month." But as far as the customers were concerned, they were seeing several a week. They soon learned to chuck them out unread. Perfectly good, responsive, profitable and loyal customers had been ruined by over promotion. A failure of customer management.
The result is what we call "file fatigue". Your best customers are worn down under a deluge of mail. You have worn out your welcome. Each of the segment managers says, "I didn’t over-promote. I never sent more than one a month." But as far as the customers were concerned, they were seeing several a week. They soon learned to chuck them out unread. Perfectly good, responsive, profitable and loyal customers had been ruined by over promotion. A failure of customer management.
Positioning
After you have determined which markets your organization should begin targeting, it is important to strategize about how you want to position your products and services.
An effective position begins by realising your company’s competitive advantages and being able to build upon them. Competitive advantages come from gains your organization makes by offering customers greater value than your competitor, through lower prices, better quality, or stronger company image. Additional competitive advantages may be the diversity of products and services offered, timely installation and maintenance, and efficient problem solving. Customer service orientation, attitude and training can be developed into a competitive advantage over competitors and is one way to ensure continued company growth.
Positioning implies differentiating your company from the competitor. What makes your company different and better than the competition? A company or market can be differentiated by product, services, personnel, or image. Think about which of these aspects are important to your customers and where your competitive advantages are, then decide how your company can develop a position that states these differences.
Although telecommunications is primarily a service provider, your company may also sell the telephones, fax machines, or cellular phones. These physical products can be differentiated by offering quality performance, various design options, as well as goods that are durable and reparable.
Your organization can offer more variety of different services than your competitors by establishing customer and employee training programs or consulting services for the customers that determine the most appropriate products and services to meet their needs.
Companies can gain competitive advantage through personnel. This means hiring, training, and motivating employees better than the competition. Not only technical experts, but also people who understand business and know how to meet the needs of the business clients. Continuous training and updating of the entire staff with regards to customer service, technology, and business skills will give your organization an advantage in the short term and in the long term! Additionally, a customer education programme which includes information about telecommunications and lists benefits of your company can be very useful to distinguish your organization from the competition.
Finally, think about the image of your organization in the minds of the customers. How can that image be improved or built upon? As with many telecommunications entities in developing countries, your organization may have an image problem. In studies conducted by the World Bank and the ITU, an overwhelming majority of people do not trust the telecom entity in their country. The image is one of government bureaucracy that is neither highly effective nor highly efficient. If this describes your organization, this must change! Your telecom entity must cooperate to change this image and create a strong new image in the minds of customers that promotes the hard work you are doing to make telecom a reality in your country. Image can be a very strong competitive advantage.
An effective position begins by realising your company’s competitive advantages and being able to build upon them. Competitive advantages come from gains your organization makes by offering customers greater value than your competitor, through lower prices, better quality, or stronger company image. Additional competitive advantages may be the diversity of products and services offered, timely installation and maintenance, and efficient problem solving. Customer service orientation, attitude and training can be developed into a competitive advantage over competitors and is one way to ensure continued company growth.
Positioning implies differentiating your company from the competitor. What makes your company different and better than the competition? A company or market can be differentiated by product, services, personnel, or image. Think about which of these aspects are important to your customers and where your competitive advantages are, then decide how your company can develop a position that states these differences.
Although telecommunications is primarily a service provider, your company may also sell the telephones, fax machines, or cellular phones. These physical products can be differentiated by offering quality performance, various design options, as well as goods that are durable and reparable.
Your organization can offer more variety of different services than your competitors by establishing customer and employee training programs or consulting services for the customers that determine the most appropriate products and services to meet their needs.
Companies can gain competitive advantage through personnel. This means hiring, training, and motivating employees better than the competition. Not only technical experts, but also people who understand business and know how to meet the needs of the business clients. Continuous training and updating of the entire staff with regards to customer service, technology, and business skills will give your organization an advantage in the short term and in the long term! Additionally, a customer education programme which includes information about telecommunications and lists benefits of your company can be very useful to distinguish your organization from the competition.
Finally, think about the image of your organization in the minds of the customers. How can that image be improved or built upon? As with many telecommunications entities in developing countries, your organization may have an image problem. In studies conducted by the World Bank and the ITU, an overwhelming majority of people do not trust the telecom entity in their country. The image is one of government bureaucracy that is neither highly effective nor highly efficient. If this describes your organization, this must change! Your telecom entity must cooperate to change this image and create a strong new image in the minds of customers that promotes the hard work you are doing to make telecom a reality in your country. Image can be a very strong competitive advantage.
Market Targeting
The market targeting process begins with evaluating the different market segments. There are three main factors that you can use to evaluate the segments: segment size and growth, segment structural attractiveness, and company objectives and resources.
First, you must determine the segment size and potential rate of growth. What is the size of the business market, the household market, the government agency market in your country? This may not be an issue for basic services in most developing countries, as the demand far outstrips the supply at the moment. But, what are the areas of growth, where are they, and who do they represent? You must estimate the size of each segment as well as the approximate growth rate over the next year, five years, ten years.
The next step for targeting the market includes determining each segment’s “structural attractiveness”. This means analysing each market segment by looking at the structure and components of each pre-determined segment. A useful tool is a model developed by a prominent management theorist, Michael Porter. His model is based on “Five Forces” which occur in each market segment. The Five Forces model is illustrated and explained below. Remember that this is a dynamic analysis with all of the forces interacting.
Porter’s Five Forces
1. Industry Competitors (Segment Rivalry): Who and what are the competitors in each segment that you have determined? How intense is the competition? For example, if one of the market segments is small businesses in the urban areas, you need to look at what other methods of communicating are available to them as well as other competing telecom companies that are operating in that market segment.
2. Potential entrants: Who will be the likely competitors for each segment in the near future? Which segments are your potential competitors most interested in entering? What types of competing services will be entering the your country next year? In five years?
3. Substitute products or services: What are the types of products that can be easily substituted for telecommunications? Think about the other means of communication that a person can use and determine for each segment the likelihood of one of those being chosen over telecom.
4. Buyers power: As the buyers, or subscribers, have more choices, they have more bargaining power to demand better quality or range of products and services as well as lower prices. What is the level of bargaining power associated with each market segment? Do some segments have more bargaining power than others?
5. Suppliers power : The bargaining power of your suppliers increases if they are the sole suppliers of equipment, if there are few substitutes, or if it is difficult or expensive to change suppliers. Think about the suppliers of telecom equipment for your organization.
Finally and most importantly, you must determine which segments fit the organization’s objectives and match its resources. Does your organization possess the skills, the money, and the other resources to meet the needs in every segment? Probably not. So, you need
to determine which of the segments you should concentrate on to begin with and then which segments your organization will pursue later.
For example, many telecom entities are focusing first on the business clients who rely so heavily on telecommunications in order to do business. With the revenue gained by providing efficient, quality service to these segments, the telecom organizations can develop infrastructure and access more household customers. Is this a likely scenario in your country?
First, you must determine the segment size and potential rate of growth. What is the size of the business market, the household market, the government agency market in your country? This may not be an issue for basic services in most developing countries, as the demand far outstrips the supply at the moment. But, what are the areas of growth, where are they, and who do they represent? You must estimate the size of each segment as well as the approximate growth rate over the next year, five years, ten years.
The next step for targeting the market includes determining each segment’s “structural attractiveness”. This means analysing each market segment by looking at the structure and components of each pre-determined segment. A useful tool is a model developed by a prominent management theorist, Michael Porter. His model is based on “Five Forces” which occur in each market segment. The Five Forces model is illustrated and explained below. Remember that this is a dynamic analysis with all of the forces interacting.
Porter’s Five Forces
1. Industry Competitors (Segment Rivalry): Who and what are the competitors in each segment that you have determined? How intense is the competition? For example, if one of the market segments is small businesses in the urban areas, you need to look at what other methods of communicating are available to them as well as other competing telecom companies that are operating in that market segment.
2. Potential entrants: Who will be the likely competitors for each segment in the near future? Which segments are your potential competitors most interested in entering? What types of competing services will be entering the your country next year? In five years?
3. Substitute products or services: What are the types of products that can be easily substituted for telecommunications? Think about the other means of communication that a person can use and determine for each segment the likelihood of one of those being chosen over telecom.
4. Buyers power: As the buyers, or subscribers, have more choices, they have more bargaining power to demand better quality or range of products and services as well as lower prices. What is the level of bargaining power associated with each market segment? Do some segments have more bargaining power than others?
5. Suppliers power : The bargaining power of your suppliers increases if they are the sole suppliers of equipment, if there are few substitutes, or if it is difficult or expensive to change suppliers. Think about the suppliers of telecom equipment for your organization.
Finally and most importantly, you must determine which segments fit the organization’s objectives and match its resources. Does your organization possess the skills, the money, and the other resources to meet the needs in every segment? Probably not. So, you need
to determine which of the segments you should concentrate on to begin with and then which segments your organization will pursue later.
For example, many telecom entities are focusing first on the business clients who rely so heavily on telecommunications in order to do business. With the revenue gained by providing efficient, quality service to these segments, the telecom organizations can develop infrastructure and access more household customers. Is this a likely scenario in your country?
Consumer Behavioural Segmentation
Behavioural segmentation divides customer groups based on their knowledge, attitude, use, or response to the product (telecommunications). Many of these variables are difficult to determine exactly, but you must attempt educated guesses. This segmentation can begin with a look at what types of benefits the customers look for in the product. Benefits related to telephones could include the quality, frequency, economy of communications.
What is the status of your customers? This means grouping consumers into nonusers, ex-users, potential users, first time users, or regular users. People who are regular users of your services, such as businesses, may be targeted for discount programmes, new services, or innovative products. Those people who are not using telecommunications at all or who are new to this form of communication will need to be educated about the types of services and benefits you offer.
Usage rates or volume segmentation looks at how often your customers use telephones--not at all, only once a month, several times a week, many times a day? These frequency questions can help you to understand the various types of usage needs of customers. Also, who do they call and where do they call in order to estimate how much long distance profit potential may exist.
What is the level of customer loyalty to telephones? If it was just as easy to send a letter to a friend, which method would they most likely choose? This is not necessarily looking at the customer loyalty to your organization, but rather to the idea and use of telephones as a way to communicate. You might discover that business customers have an absolute loyalty to telephones because it makes their jobs more efficient and effective.
What is the buyer-readiness stage and attitude toward your product or service? Are they ready to buy and enthusiastic about the opportunity to have a telephone or are they hesitant and not aware of the benefits of telecommunications? Readiness can take the form of awareness, interest, and intention to buy. Attitude can mean they are positive, indifferent, or negative towards telephone communication.
What is the status of your customers? This means grouping consumers into nonusers, ex-users, potential users, first time users, or regular users. People who are regular users of your services, such as businesses, may be targeted for discount programmes, new services, or innovative products. Those people who are not using telecommunications at all or who are new to this form of communication will need to be educated about the types of services and benefits you offer.
Usage rates or volume segmentation looks at how often your customers use telephones--not at all, only once a month, several times a week, many times a day? These frequency questions can help you to understand the various types of usage needs of customers. Also, who do they call and where do they call in order to estimate how much long distance profit potential may exist.
What is the level of customer loyalty to telephones? If it was just as easy to send a letter to a friend, which method would they most likely choose? This is not necessarily looking at the customer loyalty to your organization, but rather to the idea and use of telephones as a way to communicate. You might discover that business customers have an absolute loyalty to telephones because it makes their jobs more efficient and effective.
What is the buyer-readiness stage and attitude toward your product or service? Are they ready to buy and enthusiastic about the opportunity to have a telephone or are they hesitant and not aware of the benefits of telecommunications? Readiness can take the form of awareness, interest, and intention to buy. Attitude can mean they are positive, indifferent, or negative towards telephone communication.
Consumer Characteristic Segmentation
Geographic segmentation: It divides the market into different geographical units such as states, regions, cities, or neighbourhoods. This answers the question of where your customers are located. For developing countries, it is especially important to segment based on urban or rural geographics. Where are most of your current and potential customers located? These broad groups can be further segmented based on factors such as size or population density, etc. The idea is to continue segmenting until you have manageable groups of customers located in the same geographic area.
Demographic segmentation: It includes such variables as the size of the business, the household, or other organizations that you serve, how much income they earn and how much they spend or may spend on telecommunications. Big businesses such as banks or industries will have different needs from small commercial operations. What are some of these differences? Also, educational facilities and hospitals can vary depending on size, income, needs, and amount of money spent on telecommunications.
Who are your biggest clients--in terms of size and in terms of amount of money spent on telecommunications? Can you list them? In most countries, the government is one of the largest consumers of telecommunications, and as such, constitutes one segment. What special needs and demands do governments have and how can you better serve these needs?
How can you segment your household customers? We have already discussed urban and rural segmentation, but what about the size of the household and the income level?
This type of demographic segmentation helps you to get to know your customers and the size of their operations. Information of this sort will become more important in the future as competitors enter the market and offer different products and services to meet different needs or wants of these customer segments.
Psychographic segmentation: It divides buyers into different groups based on lifestyle and personality characteristics. What type of lifestyle do your customer groups have? Are they on-the-go in the cities or are they working at home or on a farm? The importance of trying to answer some of these questions is that different lifestyles sometimes mean that they have different needs for telecommunication.
Demographic segmentation: It includes such variables as the size of the business, the household, or other organizations that you serve, how much income they earn and how much they spend or may spend on telecommunications. Big businesses such as banks or industries will have different needs from small commercial operations. What are some of these differences? Also, educational facilities and hospitals can vary depending on size, income, needs, and amount of money spent on telecommunications.
Who are your biggest clients--in terms of size and in terms of amount of money spent on telecommunications? Can you list them? In most countries, the government is one of the largest consumers of telecommunications, and as such, constitutes one segment. What special needs and demands do governments have and how can you better serve these needs?
How can you segment your household customers? We have already discussed urban and rural segmentation, but what about the size of the household and the income level?
This type of demographic segmentation helps you to get to know your customers and the size of their operations. Information of this sort will become more important in the future as competitors enter the market and offer different products and services to meet different needs or wants of these customer segments.
Psychographic segmentation: It divides buyers into different groups based on lifestyle and personality characteristics. What type of lifestyle do your customer groups have? Are they on-the-go in the cities or are they working at home or on a farm? The importance of trying to answer some of these questions is that different lifestyles sometimes mean that they have different needs for telecommunication.
Intelligence Maturity Levels
These levels can change overtime from company to company. But at the very beginning, one should know and be conscius at locating which level!
Knowledge Discovery:
Information Management
* Very advanced DWH enviroment,
* Data nicely managed,
* Not efficient use of data (sittingon data!!),
* lots of data but no insights
Knowledge Discovery:
* Very advanced analytics,
* Datamining experts,
* Marketers do not use models,
* Unable to understand and execute,
Marketing Execution:
* Targeted messages,
* Short time to market,
* Campaign stands on themselves,
* No consistent customer approach
Customer Centrality:
* Optimization of campaigns and target modeling,
* Best offer for the customer and company model,
* Consistent customer approach
CRM Obstacles
Internal Focus: The companies which act and decide without customer view are very far away from CRM concept. At first step, they should take action to have standart market research reports and customer analysis.
After starting to understand customer needs and tendencies, they should step in for CRM.
Organisational Structure: The organizational structure of company make great difference in the result and success of CRM results. CRM teams which are supported by top management and directly report have greater chance to succeed. Otherwise, the long term CRM projects may be perceived as unnecessary by the employees that under daily work pressure.
Vision of Workers: CRM concept is somewhat blurred compared with routine financial and marketing activities. Thus, CRM benchmarks, conferences and consulting firms can be very beneficial to expand the horizans.
Inadequate Technology: CRM is an expensive concept to handle and requires a lot of fix and variable investment. There are many softwares in each step of CRM. Databases systems to gather necessary customer data, reporting and modelling tools, customer touch point tools etc..
After starting to understand customer needs and tendencies, they should step in for CRM.
Organisational Structure: The organizational structure of company make great difference in the result and success of CRM results. CRM teams which are supported by top management and directly report have greater chance to succeed. Otherwise, the long term CRM projects may be perceived as unnecessary by the employees that under daily work pressure.
Vision of Workers: CRM concept is somewhat blurred compared with routine financial and marketing activities. Thus, CRM benchmarks, conferences and consulting firms can be very beneficial to expand the horizans.
Inadequate Technology: CRM is an expensive concept to handle and requires a lot of fix and variable investment. There are many softwares in each step of CRM. Databases systems to gather necessary customer data, reporting and modelling tools, customer touch point tools etc..
Different relation types between customer and company
First and the worst is: Internal Focus
Second: External Focus
Third: Synchronous Relation
Last but the best: Customer Centric
Company designs, produces and present and wait for customer to purchase.
The companies which has this type of relation, can never increases its revenues by the time and also they are in a great risk as customers' consumption behaviour changes. Family
The companies which has this type of relation, can never increases its revenues by the time and also they are in a great risk as customers' consumption behaviour changes. Family
Second: External FocusThese types of companies act strictly paralel with customer needs. This is very succesful method in service sector but has some drawbacks for the company to take futuristic action.
Third: Synchronous RelationThis type is better than the first two and enhances relation between company and customer.
But still, company sees the customer apart from them. So this kind of relation may have disadvantages to catch the changes instantly.Last but the best: Customer CentricAlways think yourself as you are a customer. What you want and not..
This relation seems the same as the third but it is not. Building the organizational structure, business processes and marketing strategies is crucial while constructing this kind of relationship.
4C 4 Customers
In the aspect of customer, well-known 4p s of marketing transforms to 4c s of customers.
Consumer wants and needs (vs. Products):You can't develop products and then try to sell them to a mass market. You have to study consumer wants and needs and then attract consumers one by one with something each one wants. Author of the movie Field of Dreams, J.P. Cancilla may have exclusive rights to the phrase "build it and they will come". In most cases, you have to find out what people want and then "build" it for them, their way.
Cost to satisfy (vs. Price):You have to realize that price - measured in dollars - is one part of the cost to satisfy. If you sell hamburgers, for example, you have to consider the cost of driving to your restaurant, the cost of conscience of eating meat, etc. One of the most difficult places to be in the business world is the retailer selling at the lowest price. If you rely strictly on price to compete you are vulnerable to competition - in the long term.
Convenience to buy (vs. Place): You must think of convenience to buy instead of place. You have to know how each subset of the market prefers to buy - on the Internet, from a catalogue, on the phone, using credit cards, etc. Lands End clothing, Amazon Books and Dell Computers are just a few businesses who do very well over the Internet.
Communication (vs. Promotion): You have to consider the communication instead of promotion. Promotion is manipulative (ouch!) - it’s from the seller. Communication requires a give and take between the buyer and seller (that's nicer). Be creative and you can make any advertising "interactive". Use phone numbers, your web site address, etc. to help here. And listen to your customers when they are "with" you.
Consumer wants and needs (vs. Products):You can't develop products and then try to sell them to a mass market. You have to study consumer wants and needs and then attract consumers one by one with something each one wants. Author of the movie Field of Dreams, J.P. Cancilla may have exclusive rights to the phrase "build it and they will come". In most cases, you have to find out what people want and then "build" it for them, their way.
Cost to satisfy (vs. Price):You have to realize that price - measured in dollars - is one part of the cost to satisfy. If you sell hamburgers, for example, you have to consider the cost of driving to your restaurant, the cost of conscience of eating meat, etc. One of the most difficult places to be in the business world is the retailer selling at the lowest price. If you rely strictly on price to compete you are vulnerable to competition - in the long term.
Convenience to buy (vs. Place): You must think of convenience to buy instead of place. You have to know how each subset of the market prefers to buy - on the Internet, from a catalogue, on the phone, using credit cards, etc. Lands End clothing, Amazon Books and Dell Computers are just a few businesses who do very well over the Internet.
Communication (vs. Promotion): You have to consider the communication instead of promotion. Promotion is manipulative (ouch!) - it’s from the seller. Communication requires a give and take between the buyer and seller (that's nicer). Be creative and you can make any advertising "interactive". Use phone numbers, your web site address, etc. to help here. And listen to your customers when they are "with" you.
Different types of analytic models
Predictive models:
Predictive models analyze past performance to assess how likely a customer is to exhibit a specific behavior in the future in order to improve marketing effectiveness. This category also encompasses models that seek out subtle data patterns to answer questions about customer performance, such as fraud detection models. Predictive models often perform calculations during live transactions, for example, to evaluate the risk or opportunity of a given customer or transaction, in order to guide a decision.
Descriptive models:
Descriptive models “describe” relationships in data in a way that is often used to classify customers or prospects into groups. Unlike predictive models that focus on predicting a single customer behavior (such as credit risk), descriptive models identify many different relationships between customers or products. But the descriptive models do not rank-order customers by their likelihood of taking a particular action the way predictive models do. Descriptive models are often used “offline,” for example, to categorize customers by their product preferences and life stage. Descriptive modeling tools can be utilized to develop agent based models that can simulate large number of individualized agents to predict possible futures.
Decision models:
Decision models describe the relationship between all the elements of a decision — the known data (including results of predictive models), the decision and the forecast results of the decision — in order to predict the results of decisions involving many variables. These models can be used in optimization, a data-driven approach to improving decision logic that involves maximizing certain outcomes while minimizing others. Decision models are generally used offline, to develop decision logic or a set of business rules that will produce the desired action for every customer or circumstance.
Predictive models analyze past performance to assess how likely a customer is to exhibit a specific behavior in the future in order to improve marketing effectiveness. This category also encompasses models that seek out subtle data patterns to answer questions about customer performance, such as fraud detection models. Predictive models often perform calculations during live transactions, for example, to evaluate the risk or opportunity of a given customer or transaction, in order to guide a decision.
Descriptive models:
Descriptive models “describe” relationships in data in a way that is often used to classify customers or prospects into groups. Unlike predictive models that focus on predicting a single customer behavior (such as credit risk), descriptive models identify many different relationships between customers or products. But the descriptive models do not rank-order customers by their likelihood of taking a particular action the way predictive models do. Descriptive models are often used “offline,” for example, to categorize customers by their product preferences and life stage. Descriptive modeling tools can be utilized to develop agent based models that can simulate large number of individualized agents to predict possible futures.
Decision models:
Decision models describe the relationship between all the elements of a decision — the known data (including results of predictive models), the decision and the forecast results of the decision — in order to predict the results of decisions involving many variables. These models can be used in optimization, a data-driven approach to improving decision logic that involves maximizing certain outcomes while minimizing others. Decision models are generally used offline, to develop decision logic or a set of business rules that will produce the desired action for every customer or circumstance.
Few words on customer satisfaction
If it used properly CRM can be the exploitation of technology to enhance and personalise customer interactions with the objective of acquiring and retaining customers.
If not, the random deployment of expensive and elaborate technology in a desperate bid to be more exciting than your competitors.
If not, the random deployment of expensive and elaborate technology in a desperate bid to be more exciting than your competitors.
CRM increases the customer satisfaction and hence customer retention. The below graphic shows represantative curve that shows the relations between customer satisfaction and retention. The middle part of the graph shows us that upper certain level of "customer satisfaction", retention does not increases up to a certain satisfaction level. So one should carefully decide where to be in the curve?
Components of satisfaction can be grouped in 4 titles:
Qualitative: Style of communications, Service perception, Product quality
Brand: Image, Values, Credibility, Coherence,
Performance: Product/ service delivery, Call centre wait times, Email response times, Call-back reliability
Operational: Frequency of use, Time-saving, Dependency, Barriers to change
Operational: Frequency of use, Time-saving, Dependency, Barriers to change
Below curve shows the relation between customer satisfaction and retention for the 4 components of satisfaction. Operational and Performance components seem to increase retention much more the the other two.
As it is seen, customer satisfaction depends on many component and customer satisfaction and loyalty are not linearly releated.
5 marketing trends
Increasing consumer expectations and high demand across all categories are causing a lag in brand image, and the answer to the problem lies in predictive loyalty metrics that measure the direction and speed of change in consumer values, according to loyalty research agency Brand Keys, which predicts five key brand and marketing trends in the future.
- Consumer engagement: Inserting itself between traditional marketing activities and an increasing demand for ROI assessments, the metric of Engagement will become the 'Holy Grail' for marketers and advertisers alike. Engagement - defined as the outcome of advertising and marketing activities that substantively increases a brand's strength in the eyes of the consumers (and actually predicts sales and profitability) - will be used more and more to allocate marketing budgets. Watch out for joint task forces from organisations such as the ANA, ARF, AAAA's and AMA to provide additional meaning and metrics for engagement.
- Growing expectations: Consumer expectations in all categories will continue to grow. Expectations have increased more than 26% in the past five years while brands have only kept up by 8%. The smarter marketers will be taking advantage of unfulfilled expectations through values such as convenience and customisation. More and more marketers will rely upon online sites and high-tech capabilities to accommodate these values and differentiate themselves from the competition. Watch out for more tailored products and electronic kiosks at places beyond the usual airport and bank locations. "Think in terms of Jetson-like hotel check-in capabilities," Passikoff suggests.
- Online activity: Engagement concerns, and attempts to meet or exceed customer expectations, will fuse and will be most observed in online activities and blogs. Watch for the increased development of both, above and beyond the usual propaganda and electronic cash-register use, as both attempt to create actual Communities of One. The blurring of reality and imagination is part of the explanation for the reality show fad of recent years, so watch for entertainment and information becoming one and the same. Also watch for more and more web-based applications via computer desktops, handhelds, and mobile phones.
- Advertising venue appropriateness: Advertising venues that are traditionally considered inappropriate for a brand will be adopted, simply because that's where the consumers are going. Is this a case of oil and water mixing? Passikoff believes so. Current consumer values suggest a strangely bi-polar trend for experiences, such as a dramatic increase in on-line gaming, especially for adults. For example, interactive gaming with more and more players being able to compete at once will become the norm, and games such as Mah Jong could well replace poker as the most popular game (especially in Asia-Pacific). Marketers concerned with engagement will - to some degree at least - need to close their eyes to the appropriateness of these activities and use online gaming as a more acceptable venue for almost any brand.
- Music culture taking over: Popular culture, with its seeming insatiable appetite for music and technology, will see market and brand leaders start to use "plugging-in" techniques as a way of customising entertainment and selling their products. Music-related paraphernalia (such as tee shirts, posters, and artist related merchandise) will begin to infringe more and more on the dominance of bricks-and-mortar retail. Watch out for a marked increase in branded entertainment campaigns throughout in future. Brand Keys provides its clients with customer loyalty research, providing brand equity metrics to predict future consumer behaviour and anticipating shifts in rapidly changing markets.
Useful areas to use datamining
There is various areas to use datamining techniques , but the best way is starting with the essentials.
The very basic areas to use datamining are marketing and finance.
In marketing:
The very basic areas to use datamining are marketing and finance.
In marketing:
- Target marketing: Find clusters of “model” customers who share the same characteristics: interest, income level, spending habits, churn probability etc.
- Determine customer purchasing/usage patterns over time:
For example: Conversion of single to a joint bank account: marriage, etc. - Cross-sell analysis: Associations/co-relations between product sales and prediction based on the association information,
- Customer profiling: Data mining can tell you what types of customers buy which products (clustering or classification),
- Identifying customer requirements: identifying the best products for different customers, use prediction to find what factors will attract new customers,
- Reporting: Various multi-dimensional summary reports and statistical summary information (data central tendency and variation),
In Finance:
- Fraud detection and management: use historical data to build models of fraudulent behavior and use data mining to help identify similar instances,
- Finance planning and asset evaluation: cash flow analysis and prediction, contingent claim analysis to evaluate assets, cross-sectional and time series analysis (financial-ratio, trend analysis, etc.),
- Resource planning: summarize and compare the resources and spending,
- Competition:monitor competitors and market directions, group customers into classes and a class-based pricing procedure, set pricing strategy in a highly competitive market,
Other Application areas:
- Sports: IBM Advanced Scout analyzed NBA game statistics (shots blocked, assists, and fouls) to gain competitive advantage for New York Knicks and Miami Heat,
- Astronomy:JPL and the Palomar Observatory discovered 22 quasars with the help of data mining,
- Internet Web Surf-Aid: IBM Surf-Aid applies data mining algorithms to Web access logs for market-related pages to discover customer preference and behavior pages, analyzing effectiveness of Web marketing, improving Web site organization, etc.
Datamining in 4 steps
1-Data Collection
First thing to start with gathering necessary and sufficient from business sources like; Credit card transactions, loyalty cards, discount coupons, customer call details, customer complaint calls, plus (public) lifestyle studies. Data sources will absolutely change in various sectors and the amount and quality of data will also effect outcome of datamining. Data collection is the most resource (time, money and motivation ) consuming part of datamining. One should not be stuck in data collection and should absolutely try paralel working in other phases of datamining.
After having the right data, tools, workers and vision, here comes the beneficial predictive models and segments.
2-Tool Selection
There are several even better to say a few softwares in datamining area such as: SPSS, SPSS Clementine, SAS enterprise guide, SAS miner, Insightful miner, KXEN, Statistica..
Below Gartner diagram compares datamining tools in 2 dimension; first is “ability to execute” and the second “completeness of vision”.
You can find the full Gartner Report below link: http://mediaproducts.gartner.com/reprints/sas/vol5/article3/article3.html
3- Workers
In summary , beside having ability to use required softwares and experience, an ideal data miner should also have to be eager to learn, highly motivated and should have analytical scope of view and result oriented.
4- Vision
The hardest part of datamining to sustain. As the business environment and stuff change rapidly, the long term datamining projects may be challenging to carry on. Hence top management’s long term support turns out to be crucial to exist.
First thing to start with gathering necessary and sufficient from business sources like; Credit card transactions, loyalty cards, discount coupons, customer call details, customer complaint calls, plus (public) lifestyle studies. Data sources will absolutely change in various sectors and the amount and quality of data will also effect outcome of datamining. Data collection is the most resource (time, money and motivation ) consuming part of datamining. One should not be stuck in data collection and should absolutely try paralel working in other phases of datamining.
After having the right data, tools, workers and vision, here comes the beneficial predictive models and segments.
2-Tool Selection
There are several even better to say a few softwares in datamining area such as: SPSS, SPSS Clementine, SAS enterprise guide, SAS miner, Insightful miner, KXEN, Statistica..
Below Gartner diagram compares datamining tools in 2 dimension; first is “ability to execute” and the second “completeness of vision”.
You can find the full Gartner Report below link: http://mediaproducts.gartner.com/reprints/sas/vol5/article3/article3.html
3- Workers
In summary , beside having ability to use required softwares and experience, an ideal data miner should also have to be eager to learn, highly motivated and should have analytical scope of view and result oriented.
4- Vision
The hardest part of datamining to sustain. As the business environment and stuff change rapidly, the long term datamining projects may be challenging to carry on. Hence top management’s long term support turns out to be crucial to exist.
Datamining: old but not mature concept
Datamining is over ten years old concept but not used effectivelly in many areas..
Data explosion problem is one of the main reasons. Automated data collection tools and mature database technology lead to tremendous amounts of data stored in databases, data warehouses and other information repositories.
If this is the case “ We are drowning in data, but starving for knowledge!”, here comes the solution: Data warehousing and then data mining.
* After succesful data warehousing and hence on-line analytical processing, as a result extraction of interesting knowledge (rules, regularities, patterns, constraints) from data in large databases.
Evolution of Database Technology
1960s: Data collection, database creation, IMS and network DBMS
1970s: Relational data model, relational DBMS implementation
1980s: RDBMS, advanced data models (extended-relational, OO, deductive, etc.) and application-oriented DBMS (spatial, scientific, engineering, etc.)
1990s—2000s: Data mining and data warehousing, multimedia databases, and Web databases
What Is Data Mining?
Data mining (knowledge discovery in databases): Extraction of interesting (non-trivial, implicit, previously unknown and potentially useful) information or patterns from data in large databases
Alternative names : Knowledge discovery(mining) in databases (KDD), knowledge extraction, data/pattern analysis, data archeology, data dredging, information harvesting, business intelligence, etc.
What is not data mining?: (Deductive) query processing, Expert systems or small ML/statistical programs
What Is Data Mining? – Potential Applications
Market analysis and management: Target marketing, customer relation management, market basket analysis, up-cross selling, market segmentation, rule based marketing
Risk analysis and management: Forecasting, customer retention, improved underwriting, quality control, competitive analysis.
Fraud detection and management
Other Applications: Text mining (news group, email, documents) and Web analysis, Intelligent query answering..
Data explosion problem is one of the main reasons. Automated data collection tools and mature database technology lead to tremendous amounts of data stored in databases, data warehouses and other information repositories.
If this is the case “ We are drowning in data, but starving for knowledge!”, here comes the solution: Data warehousing and then data mining.
* After succesful data warehousing and hence on-line analytical processing, as a result extraction of interesting knowledge (rules, regularities, patterns, constraints) from data in large databases.
Evolution of Database Technology
1960s: Data collection, database creation, IMS and network DBMS
1970s: Relational data model, relational DBMS implementation
1980s: RDBMS, advanced data models (extended-relational, OO, deductive, etc.) and application-oriented DBMS (spatial, scientific, engineering, etc.)
1990s—2000s: Data mining and data warehousing, multimedia databases, and Web databases
What Is Data Mining?
Data mining (knowledge discovery in databases): Extraction of interesting (non-trivial, implicit, previously unknown and potentially useful) information or patterns from data in large databases
Alternative names : Knowledge discovery(mining) in databases (KDD), knowledge extraction, data/pattern analysis, data archeology, data dredging, information harvesting, business intelligence, etc.
What is not data mining?: (Deductive) query processing, Expert systems or small ML/statistical programs
What Is Data Mining? – Potential Applications
Market analysis and management: Target marketing, customer relation management, market basket analysis, up-cross selling, market segmentation, rule based marketing
Risk analysis and management: Forecasting, customer retention, improved underwriting, quality control, competitive analysis.
Fraud detection and management
Other Applications: Text mining (news group, email, documents) and Web analysis, Intelligent query answering..
Not just a SMS, but a promotion tool
We are all accustomed to slogan :"Join new year lottery, win up to 10 Mio $" .Below, this scenario is used for revenue increase in telco Via SMS..
WHAT: A new breed of mass one-to-one SMS promotions generating unprecedented consumer involvement and extraordinary mobile operator revenues across Europe
WHY: Create buzz and word of mouth phenomena around the brand, reinforcing its values
Highly profitable initiative – with considerable revenues and strong ROI – with a low and controlled risk. Customer base participation can be as high as 35% and campaign ARPU as high as €30 in less than 3 months.
An Opportunity for operators to launch a ‘huge’ concept that will generate outstanding results
WHEN: The SMS Promotion is most effective if build around special occasions for the operators (e.g. anniversary, reaching a certain plateau of customers)
HOW: These results are made possible through the application of mobile specific CRM strategy and technology that maximizes participation, consumer experience and ROI
An example:
» For 3 months (100 days) subscribers can participate by sending a SMS to a specific short code.
» Every SMS earns you 20 points
» Each point is the equivalent of one ticket/lot for the prize draws
» One SMS gets you listed for all prize draws
» Points collected are carried along throughout the promotion. Every time you play, you enter the draws with all your previous points
Different ways can be used to push the costomer:
» 1 in 10 messages wins bonus points, 2x, 3x, .., Time window,Thresholds, Surprise draw, Viral,, Most messages win, Teaser gift, Inactive push, Fanatic boost, One in X wins, Winners list, Phone number
Why it works?
WHAT: A new breed of mass one-to-one SMS promotions generating unprecedented consumer involvement and extraordinary mobile operator revenues across Europe
WHY: Create buzz and word of mouth phenomena around the brand, reinforcing its values
Highly profitable initiative – with considerable revenues and strong ROI – with a low and controlled risk. Customer base participation can be as high as 35% and campaign ARPU as high as €30 in less than 3 months.
An Opportunity for operators to launch a ‘huge’ concept that will generate outstanding results
WHEN: The SMS Promotion is most effective if build around special occasions for the operators (e.g. anniversary, reaching a certain plateau of customers)
HOW: These results are made possible through the application of mobile specific CRM strategy and technology that maximizes participation, consumer experience and ROI
An example:
» For 3 months (100 days) subscribers can participate by sending a SMS to a specific short code.
» Every SMS earns you 20 points
» Each point is the equivalent of one ticket/lot for the prize draws
» One SMS gets you listed for all prize draws
» Points collected are carried along throughout the promotion. Every time you play, you enter the draws with all your previous points
Different ways can be used to push the costomer:
» 1 in 10 messages wins bonus points, 2x, 3x, .., Time window,Thresholds, Surprise draw, Viral,, Most messages win, Teaser gift, Inactive push, Fanatic boost, One in X wins, Winners list, Phone number
Why it works?
- Direct approach : Sending prompt messages to million users
- High-response medium: SMS Mktg. typically yields response rates around
10-20%; if targeted, 30%-50%, - Attractive proposition: Mass-appeal, high value prizes,
- Easy participation: Simply send an empty SMS to participate,
Benefits:
*Instant Revenue: Boost value-added services revenues and traffic
*Long term revenue: VAS adoption Convert users to new services Client acquisition it is crucial to position oneself as the most attractive offer,
*Client retention/Loyalty: Reward, Engage and Surprise the operator customers ,The operator brand ‘top of mind’
*Enticement Make subscribers from other networks feel they are missing out
Welcome to my blog
Hi,
In this blog, I'm plannig to share my know-how specifically on data base marketing (Customer Relationship Management, Rule Based Marketing, general datamining issues:segmentation,modelling etc. ) and expect your comments and ideas about the releated issues.
I have a rich documentary archieve and 4 years fully dedicated work experience on the issue.
I will share my own experiences,ideas,cases that involved in and also other materials that I really find useful to present you.
Please never hesitate to make comment and ask questions.. I would definetly try to do my best to answer.
Hope that it worths your time..
In this blog, I'm plannig to share my know-how specifically on data base marketing (Customer Relationship Management, Rule Based Marketing, general datamining issues:segmentation,modelling etc. ) and expect your comments and ideas about the releated issues.
I have a rich documentary archieve and 4 years fully dedicated work experience on the issue.
I will share my own experiences,ideas,cases that involved in and also other materials that I really find useful to present you.
Please never hesitate to make comment and ask questions.. I would definetly try to do my best to answer.
Hope that it worths your time..
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