Customer Analytics, the 3rd Eye View

Dears,
This is my second article on the Customer Intelligence or Analytics. There is lot of fascination and enthusiasm around customer analytics. Our clients speak about analytics post implementation of Operational CRM efforts and its very natural to see this as next logical step for many CRM implementations .

It’s important to understand some basic definitions before we explore little more on this topic

· Business Intelligence is the use of information to monitor the business, identify issues, and create opportunities that can be leveraged for competitive advantage.
· Customer Intelligence/Analytics utilizes Business Intelligence strategies, processes, and technologies in order to provide the following capabilities ( as given in the picture ) regarding a CRM initiative: ( Look at the Picture)

Demographic data is only the base of a customer segmentation system. Demographic data is less effective in differencing interests and purchase patterns than customer analytics. Customer Analytics is different. It makes sense of data got from daily customer interactions and provides a single view of the customer. This is done by collating and analyzing customer information in order to gain better customer insight. It also enables an organization to make better decisions and thus improves future customer interactions.
Analytical techniques are two -Predictive models used to predict future events, and Segmentation techniques used to place customers with similar behaviors into groups.
Customer analytics includes:
Campaign analytics
Consumer analytics
Marketing analytics
Technical analytics
Transaction analytics

Uses of Customer Analytics
Customer analytic solutions are designed to cater to the specific business needs. Customer analytics identifies critical areas; root causes of problems and develops a plan to implement in risk areas. It also increases revenue and surpasses customer expectations. It provides high quality customer service and operations. Customer analytics increases customer satisfaction rates. It provides the organization with expertise. It also provides the organization with customer knowledge. Customer analytics involves looking at customer events and actions and using this to determine behavior. It tries to identify segments of the customer base in order to enable effective and efficient customer relationship management. Customer interactions are browsing, purchasing, paying, communicating etc. This is used to develop customer profiles, predict future actions, understand interactions, understand the impact of marketing etc. This increases marketing efficiency. It enhances customer interactions and increases marketing effectiveness tracking and customer analytic applications. This helps marketers to optimize campaign management and helps targeting as well.

Guidelines for Effective Customer Analytics

• Business processes kick start the objectives of the analytic projects. Personnel who develop the analytics should have knowledge of the business process and work with departmental heads. They should have an understanding of the business process. They should then set the objectives in accordance with all departmental objectives.
• The various departments like sales, marketing, IT etc must understand the infrastructure and database configuration. This should be done before choosing the analytical techniques and data that will be used. All parties should be brought together and the time frame looked at.
• Once data sources are identified it is important that the data is stored. Now, models can be built and deployed after which it is important to understand the data and correctly use it.
  Once all the actions are listed, identifying the attributes that are needed to develop the final transformation and selecting the most favorable combination of attributes should be done.
• The goal in developing a segmentation scheme is to place customers in groups that are as similar as possible.
• Data timing basically refers to how recent the data must be in order to be able to deliver the required power. In this respect it is important to work with customer interactions that are taking place also at the time of the proposed marketing, even if it requires additional resources. There should be the implementation of additional analyses.
• Additional enhancement data may be used when comparing clustering systems. But it must first be determined that the demographic data does not provide additional segmentation.
• The first step in segmentation is to define the objectives with all departments and collect the data about the customers' various interactions with the company.
• Similar to data transformation, model application and scoring is best completed using a tool outside the database environment. The process includes extracting data, transforming the attributes, updating the clusters, scoring the models, placing the scores and clusters in the database etc.
• The age of the data must be considered. The time to apply the model and time to complete the campaign process must also be considered.
• Data warehouses may not contain the complete view of the customer thus it is essential that relevant information be incorporated from other sources; including CRM, order management etc.
• Organizations can use customer analytic applications for long-term planning and to help employees make better decisions.
• To get the best out of customer information, analytic insight should extend to the employees and partners.

This weekend is festival Weekend in India and I wish all my Indian Friends Happy Dushhera

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