Understanding your customer has never been more critical – as customer insight and knowledge can spell increased return on investment (ROI) and profitability.
This was evident when Citibank Singapore obtained in-depth analyses on customer behaviour. It tailored and fine-tuned its product offerings and marketing efforts. The result? Customer takeup rates and profitability increased significantly.
And how did Citibank achieve this? By shifting its focus from products onto the customer.
Shifting from being product-centric
Since the beginning, most marketing business models have been built around organisational structures, management and incentive plans, with the focus being completely on the product. But now, marketing innovators are building new customer-centric business models that have been very successful, even in the most product-centric organisations.
Instead of focusing solely on the conventional four P’s of marketing: product, price, promotion and placement, organisations must become more customer-centric in order to succeed in today’s market. Businesses can significantly improve their marketing strategies by developing a business model that focuses on the three I’s of marketing: insight, interaction and improvement:
• Deepening customer insight. Manage data, profile and segment customers, and predict customer behaviour.
• Choreographing customer interactions. Develop and optimise strategies, and manage customer engagement at the enterprise level.
• Continuous improvement. Measure and report key performance indicators (KPIs) that matter, optimise investment of sales and marketing resources, and continuously learn from every customer interaction.
Putting technology to work
The good news for marketing executives is that marketing activities yield an abundance of data that can be transformed into valuable insights for continuous improvements – and the technology for uncovering those insights is better than ever:
• Advanced campaign management enables marketers to learn from campaign experience by measuring campaign results and automatically feeding that intelligence back into the system to fine-tune future campaigns.
• A comprehensive business intelligence framework provides a unified environment for managing data, converts it into intelligence that can be acted upon and disseminates it to decision-makers.
• Marketing mix optimisation analyses marketing mix elements and calculates ROI by any number of factors, such as advertising medium or geographic area.
• Marketing performance management provides marketing-specific KPIs, generates dashboards and scorecards that provide an at-a-glance view of performance on those key metrics.
Partnering the customer
An example is Citibank Singapore, which makes extensive use of SAS business intelligence across its business in key areas, including:
• Marketing and campaign management.
• Performance measurement and management.
• Scorecard building.
• Risk management.
• Sales commission and incentives.
“As markets evolve, people are more financially savvy, and you face different risks. We wanted to partner with customers on their financial life journey,” said Eric Sandosham, Citibank Singapore’s Director of Decision Management.
To enable this, Citibank has used technology in campaign optimisation – for example, to offer balance transfers in the credit card market, based on customer behaviours. “If you don’t do this right, if you create a scheme of zero per cent balance transfers, for instance, you risk killing your business in a few years,” explained Sandosham.
Rather than basing marketing decisions on experience and intuition alone, Citibank used SAS technology to improve the process. It did a sample mailing to 60,000 customers to build a response model and then analysed results based on different prices offered.
As a result, Citibank is now able to use the information gathered, to make the right offers to different customers, controlling right down to the bottom line the view they want to get. The bank has since experienced an exponential increase in customer takeup rates.
Where does your company stand today? To find out more about how other companies have managed to align their company’s products and services with customer needs, read this practical guide for senior marketers and decision-makers ‘Competing on Customer Intelligence’.
Ultimately, happy customers make for a long-term customer base, and therefore, more profitable companies.
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