White Paper - November 2012

Point-of-ViewCustomer Insight

Customer insights are a powerful tool in the drive toward more valuable and lasting customer relationships. Today, market- leading companies are learning what their customers want and need and giving it to them. As providers of services and products have become increasingly separated from customers through the various technology, channels, and intermediaries that come with scale, this is not an insignificant challenge.

They are mastering the use of technology to generate customer and business insight in real-time and

leverage their ability to execute more effective campaigns, segment customers more precisely, and stimulate stronger customer loyalty and higher lifetime value. After a decade of inward focus, companies are awakening to the need to shift from customer retention and acquisition, to customer engagement. A company’s success - in some cases, survival – is directly tied to their ability to more effectively engage with their customers and foster much more intimate relationships with those customers.

Many companies, despite making significant investments in CRM over the past several years, still aren’t well positioned to connect with customers in ways that maximize loyalty and repeat business. The reason is that most companies still lack the deep customer insights necessary to engage the right customers with content that meet their needs, and subsequently develop proactive programs that maximize customer retention, profitability and lifetime value.

The logic is really quite simple. Unless a company fully understands key aspects of a customer, including behaviours, attitudes and perceptions of the company relative to competitors, it will be unable to take the steps necessary to create a strong bond with the customer. Of course, the simplicity of the concept often clashes with the reality of managing thousands, hundreds of thousands or millions of customers and their multiple interactions across numerous touch points. This is especially true now that those touch points have extended further with social platforms and with a much greater ability for the customers to connect with each other to talk about your products services and brand.

We want to find the people that will say ‘yes’ to our product, service or message. Insight on the customers should lead us to find these people so that we can ‘target’ them for our campaigns and communications.

01 / Lies, Damn Lies & Statistics

Making Marketing Meaningful idioplatform.com 2

“Many companies still aren’t positioned

to connect with customers in ways

that maximise loyalty and repeat business.”

A major component of direct marketing has been segmentation. Historically, segmentation was limited to relatively basic demographic or geographic information. (Am I really defined by my age and my postcode?) This was flawed information, but it was all that was available in the 1990’s. Faced with a downward trend in response rates, tight marketing budgets and more accountability for measurable results today’s marketer needs even more data and even more accuracy in the information about customers in order to meet these demands.

As technology has moved on we now have a hierarchy of customer insight. The lowest level information

is probably name and address. Yet, in the online world neither of these are particularly useful or meaningful. Actually, I don’t need these in order to interact with you. For many organisations this has been the bedrock of their insight. Where I live has defined what segment you put me in and what data you ‘enrich’ my profile with. Given that the quality of this data can be suspect and segment profile data that is attached is such

a broad range of items, it is little wonder that there are really only small incremental lifts.

The next level is then your internal data that gives you behaviour, event and response based insight. With this you can use predictive mining techniques to create statistical models. These models then allow you to locate a customer more likely to churn or buy another product. It is still just a slice of the customer, a small window that you have as to who that person is, and what they are interested in. These statistics are not giving you any insight as to why or how this customer has got to this point. You are looking at a colour landscape but can still only see it in black and white, and even then it’s a bit fuzzy! For a lot of organisations, the number of interactions and transactions that they have with customers is very low, some may be as low as once a year, some once every twenty five years! This means that there is nothing to go on to get to the product behaviour insight from your internal transactions and you are back to using the geo/demographic enrichment.

But you may have been campaigning for a long time. You have all that history, don’t you? In order to build the statistical response models you need to have the history of who responded or didn’t to what message and what format and whole list of other variables. This then is often the next challenge for marketers, either the data has not been kept or it is not used to create response models and learn from what has worked or not. Closed loop marketing as it is often referred to is a whole other subject area but is a great source of insight.

“Consumers access vast volumes of information that is not created or controlled by the manufacturer.”

Making Marketing Meaningful idioplatform.com 3

02 / Segmentation & Behaviours

With the arrival of social platforms there is now much more data, ‘big data’ even, that we can use to build on this customer insight. But what is actually useful, what of all this data is the truth and therefore genuine insight that allows us to improve the relationships with our customer and maybe even prospects?

Take for example Linkedin, you might assume that you could use this to assess education level and maybe from that intelligence and suitability for a job. If that were the case organisations would not invest so much in interviews, psychometric testing and the equivalents in an attempt to assess who the candidates really are. Why then would we assume that this is accurate for marketing purposes?

The next dimension to consider then is time: I am only interesting when I am on a journey that is relevant to your brand. If the insight that you need is for sales or loyalty then you are not necessarily interested in me all the time. Just the moments where I am making a decision. A lot of buying decisions now start with research. Research mostly takes the form of consuming

content. This then leads us to the insight that we can gather from understanding how customers are engaging with different content. By analysing the content, not just taking the tags that the author put against it but creating a profile for each item of content. Then monitor what content the customer engages with to assign this profile data to the reader. However, you also need to understand time, as stated; I may only follow a topic once and some time ago. Therefore there should be a measure of interest in the topic that degrades.

Conclusion: The single customer view of the ‘90’s and 00’s is changing

rapidly both in size and structure. A Content Marketing strategy can bring new depths of insight that is relevant in real-time that will also mean less reliance is needed on inaccurate ‘traditional’ data.

Making Marketing Meaningful idioplatform.com 4

“Equally, what people state as

interests and what they tweet, may not be the whole truth.”

02 / Segmentation & Behaviours

idio was founded in 2006 to change the way brands communicate with their customers. It is now becoming well understood that more personalized messages and engagement across more channels contributes significantly to an increase in lifetime customer value, and that in many industries, becoming truly customer-centric is a foundation for future competitive advantage.

idio helps major organizations understand and engage with millions of customers in a personalized and measurable way. We help brands become publishers. We gather and use real-time social data, behavioral data,

and interest data. We do this across multiple channels. And we can do it at huge scale.

We have seen significantly increased engagement, customer insight, and revenues through the web, email, mobile, and social solutions that we have implemented for clients such as Unilever, Diageo, C Spire, Associated Media and The Guardian.

To find out more, please email us at: sales@idioplatform.com

03 / idio’s Vision

Making Marketing Meaningful idioplatform.com 5

London Office: idio Ltd, 4 Floor, The Battleship Building, 179 Harrow Road, London, W2 6NB

idioplatform.comsales@idioplatform.com+44 207 369 8223

idio helps multi-channel marketers build strong customer relationships and generate actionable customer insight, using personalized content.

Our platform curates, structures, delivers and measures brand content across websites, mobile sites and apps, email, social platforms and performance ads - building authority for the brand and mining the interactions for insight.

idio works with clients including Unilever, Diageo, Associated News, and the NHS. For more information, please visit www.idioplatform.com.