The Marketer. August 2005. Data Visualisation Software
The last five years have seen a revolution
in database marketing, on several fronts. Firstly, with the internet
becoming an everyday destination for consumers, companies have
been able to use the web to prospect for new customers, and to
get their existing customers to give them their name and address
details in return for the chance to win things, or just the promise
to send them more precisely-targeted marketing communications.
Secondly, as awareness of the importance of data cleansing and
suppression has grown, so companies have been able to make a better
fist of managing their customer and prospect databases, removing
those people who have said they no longer want to be on their
database, who no longer live where the company thought they did,
or who, for whatever other reason, are unlikely to respond to
any offers the company attempts to send them. But if there's one
area of database marketing that has changed more than any other
since the turn of the 21st century, it has to be data visualisation
and analysis,
As marketing jargon goes, it's not the most accessible of terms,
but in essence, data visualisation and analysis (let's invent
an acronym for it: DVA) is all about looking at your database
in great detail, segmenting it by whatever factors you choose
to apply, whether that's age, gender, demographics, geomdemographics,
transactional behaviour, and so on, in order to get to the clusters
of customers or prospects who are right for any given offer.
So if you're an online CD retailer with a database of 50,000 people,
you might use DVA techniques to whittle the entire database down
to just those people who had told you they liked jazz, (either
explicitly, or by what they buy from you) who spend more than
£200 a year with you, and whose average spend is over £40,
in order to email them with news of a new £75 Miles Davis
box set you think they might be interested in. By slicing and
dicing the database in this way, you end up with a mailing list
of maybe 5,000 very warm prospects, instead of 50,000 mostly cold
ones.
This type of segmentation itself is not new. There have always
been database specialists in IT departments who could run these
queries for the marketing team. What has changed in the last five
years is that the marketers can now do it themselves. Instead
of waiting days or weeks for the answer to one query, they can
run the queries themselves on their own desktop. And the change
has been driven almost exclusively by the emergence of sophisticated
data analysis and visualisation software tools from companies
like Alterian, SmartFocus, TEEC, Unica and others.
"The key benefits of these tools are productivity and effectiveness"
says Emma Chablo, marketing director at SmartFocus, which makes
the Viper suite of DVA software. "Decisions can be based
on data, instead of gut feeling. Marketers also respond more quickly,
and ensure that campaigns are more effective because they are
targeted at the right people. And if a campaign is not performing,
they can amend it on the fly to try to hit the response rates
they are expecting."
What you see is what you get
The real beauty of these systems, apart from the insight they
deliver, is in the way the information is presented. It's all
point-and-click, drag-and-drop. If you don't like looking at rows
and rows of numbers, press a button and lo, you have a graph.
If that doesn't do it for you, press another, and it's a pie chart.
You're interested in one particular segment of the pie chart?
So just click on it to drill down further. If you can use a PC,
you can, with not a lot of training, use one of these tools.
Using one of these tools, a marketer can carry out what the vendors
like to call "train-of-thought analysis", following
a hunch and investigating a particular cluster of consumers to
see where it might lead him. In the days when marketers relied
on IT specialists to run these database queries, this simply wasn't
possible. But with these tools, a marketer can follow his train
of through and get to the numbers he's looking for in minutes.
So using our CD retailer again, if he find the £200 annual
spend doesn't give him a big enough cluster to make it worthwhile,
he can try £175 and see where that gets him.
"These tools give marketers access to their to data through
an interface and methodology that allows them to get value"
says David Eldridge, managing director of Alterian, which makes
the Alterian Marketing Suite. "They get an easy drag-and-drop
interface, combined with high-speed processing, so they can run
train-of-thought analysis and then link into applications within
the same suite to take actions and execute a campaign."
Moreover, they go beyond breaking the data down. Campaign management
modules can track the progress of the campaign, and trigger follow-on
events to take place automatically depending on the response (or
non-response) to the first call to action. So someone who clicks
through to a website from an offer in an email but does not take
the offer up may receive a call from the call centre offering
an extra discount. Someone who opens the first email but does
not act on it might receive a follow-up email, again with an improved
offer.
They can also monitor the success of the campaign, delivering
the ROI figure that marketers increasingly need to justify their
activities, and highlighting the best- and worst-performing elements.
Lessons that can be brought to bear on future campaigns.
"Before these tools emerged, there was no real way of managing
the budget" says Adrian Abbs, managing director of TEEC,
which markets the Pivotal Marketfirst DVA suite.
"You did a campaign, and apart from an Excel spreadsheet,
it was pretty tough to measure how successful the campaign was.
The major difference now is that things are truly trackable, and
the results are clearly visible to everyone."
Knock-on effects
At Unica, which makes the Affinium suite of Enterprise Marketing
Management tools, head of marketing Carol Meyers says that when
a DVA tool is deployed is has some surprising knock-on effects.
She says:
"We hear from our customers that once they put a package
like this in place, they reduce their time to market, the time
it takes them to conceive of, plan, execute and measure an initiative,
by 50 80%. This has a lot of implications. It enables better
use of the resources for one thing. And it means that marketers,
instead of running round with their hair on fire, spinning plates,
trying to manage 101 things, completely execution-focused, finally
have time to think strategically. And because it doesn't take
as long to do things, they can try new things and come up with
more sophisticated solutions."
Of course, such sophistication does not come cheap. As Alterian's
Eldridge concedes:
"If you buy a perpetual licence for this sort of software,
it's a capex in excess of £100,000 before worrying about
implementation and training."
But, he adds, there are other ways of doing it.
"More than 70% of Alterian clients buy on an ASP (Application
Service Provider) type of contract so they pay a monthly fee for
access to the technology, in much the same way as they pay a monthly
retainer for many other types of marketing support services"
he says.
Perhaps that's why, according to SmartFocus's Chablo, SMEs are
starting to use these tools in greater numbers.
"In the early days, it was limited to the big corporates,
but now the key market is the growing mid-tier market who have
less resources but want the same value out of it" she says.
"The marketing team has to do everything a big corporate
has to do, so they want a technical solution that delivers everything
they need, from analysis to campaigning, integrated in one package."
Decision time
As may be apparent by now, these tools can bring real benefits
a company. But all the vendors agree on the need for some serious
thought before you decide which tool you go for.
"You have to think long and hard about the processes you
have in place and which ones you want to automate" says TEEC's
Abbs, while Unica's Myers adds a note of caution.
"You have to go for something that the IT people are happy
to have as part of their mix, that meets their standards"
she says. "From a marketing standpoint, you have to think
about what you need from the product perspective, to make sure
it can do all the things you want it to do. And also need to be
sure that it will be easy to use and that the marketers will willingly
adopt it. If it does not make their lives easier, it will not
be adopted and you will have wasted your money."