Retail Customer Management

Transcription

1 Retail Customer Management Marketing Automation & Optimisation knowing tomorrow s campaigns today June 2005

2 Old Mutual Group at a glance International financial services group Focusing on asset gathering and asset management We offer broad financial services Our strength is our diversity Our group in South Africa include: South-Africa s largest financial services provider (Old Mutual) Nedbank Group ltd. (4 th largest banking group in SA) Mutual & Federal (one of the largest general insurers) We also have operations in: Namibia, Kenya, Malawi and Zimbabwe United States and United Kingdom Please compete Slide 2

3 Old Mutual in Perspective OMSA is fully committed to a client-centric business model We have a large customer base of more than 4.5m active and dormant customers; where The majority of sales are still generated by the intermediated channels; but We have a strong Direct Marketing channel aimed at generating customer growth and acquiring new customers. We generate Direct campaigns for the Direct Marketing channel (mail and telephone) Leads for the Intermediated channels based on their request (pull action); and Triggers for the Intermediated and Direct channels based on our insight (push action). OM is seeking the capabilities that will assist us to support our customer goals and we aim for all operational actions to explicitly align with these goals Slide 3

4 Our customer management approach include Segmented customer base, based on customer contribution and customer potential Customer Value Propositions for the customer segments GEAR (Grow, Efficiency, Acquire, Retain) strategy with strong focus on the current customer base Use of the Direct Channel to support customer management (e.g. growth, reintermediation, warming-up leads, joint sales on behalf of intermediaries, etc.) Integration of our Business Intelligence and Marketing IT Capabilities Single Customer Data Warehouse Single point of generation for Automated Sales (I.e. campaigns, triggers and leads) Integrated leads management system across all of the channels Closed Loop automated sales reporting Integration of customer and prospect information and targeting Deployment of BI-based thinking as the bedrock for outbound targeting Moving from Many:Many to One:Many and One:Few We are moving our focus from pure campaign measures to customer-centric measures without compromising campaign efficiency Slide 4

5 Moving to the One-to-Few scenario One-to-One One-to-Few One-to-Many One-to-All Implications include Many-to-All Integration requirements increases Data requirements increases Organisational governance intensifies Investment increases One-to-One is a dream, but organisations can get meaningfully close to One-to-Few to aim for it Slide 5

6 Functional overview of our capabilities Service Marketing & Sales USAGE/EXPLOITATION Tier 5 Tier 4 Tier 3 Customer Service Customer Information Management Unit Marketing Execution Business Intelligence & Management Information Marketing Automation Operational Capabilities Analytical Capabilities INTEGRATION Tier 2 Tier 1 Tier 0 BRS Customer matching & Business Rule Services GCS Group Client System Customer DW Customer Data Warehouse EDW Enterprise Data Warehouse Internal & External Data Sources Integration Capabilities Source Systems Slide 6

7 Functional overview of our capabilities Service Marketing & Sales INTEGRATION USAGE/EXPLOITATION Tier 5 Tier 4 Tier 3 Tier 2 Tier 1 Tier 0 Customer Service Customer Information Management Unit BRS Customer matching & Business Rule Services GCS Group Client System Marketing Execution Business Intelligence & Management Information Marketing Automation Customer DW Customer Data Warehouse EDW Enterprise Data Warehouse Internal & External Data Sources Old Mutual and our 2 sister companies (Nedcor and Mutual & Federal) signed a Strategic Alliance with SAS for all our BI Solutions The Old Mutual Group in South Africa has embarked on a strategic partnership with SAS Slide 7

8 Our target solution pivots around two integration points Internal and External Data Source Group Client System (OLTP) Enterprise W/House (OLAP) MA & MO Leads Campaigns Intermediated Channels Direct Channel Interaction Points The Group Client System provides current customer records to interaction points, while the Warehouse provides the analytical base Slide 8 Closed Loop

9 More about our BI-based goals For outbound sales, Business Intelligence must support the channels to focus on high potential customers We have found that customer behaviour is strongly influenced by demographic, geographic and customer potential differences Understanding these dimensions typifies our baseline approach Once we have mastered these dimensions, we will augment with behavioural insights We have constructed various solutions to support insight-based sales Propensity Models (for campaigns and leads) Response Models (for campaigns) Income Model (understanding customer potential) Share-of-Wallet (understanding customer potential) Demographic Models (basic customer profiling) Geographic Models (understanding the relationship between residence and behaviour) Geographic Penetration (WIP, understanding area penetration) Segmentation Models (primary and secondary) Weak in buying behaviour models (Mostly due to lack of fine-grain transaction data) Test and learn and Closed-Loop campaigns and triggers Automating triggers None of these concepts are new, the challenge is to persevere with the appropriate actions until the benefits are yielded Slide 9

10 Customer insight dimensions Data-based Triggers Our Products & Services what have they bought and what can we offer them Behaviour how are they behaving (buying/relationship) Potential what can they afford Geographics what do we know from where they live Demographics Who are the clients Customer Experience how are they experiencing us Life Events None of these concepts are new, the challenge is to persevere with the appropriate actions until the benefits are yielded Slide 10

11 Moving to the One-to-Few scenario Integrated Leads Management across channels Closed-Loop Automation Marketing Optimisation OPTIMISING CAPABILITIES One-to-Few One-to-One One-to-Many Many-to-All One-to-All Single Enterprise Warehouse Single point for datadriven sales support Integration of customer and prospect information Slide 11 BI based support FOUNDATION CAPABILITIES One-to-One is a dream, but organisations can get meaningfully close to One-to-Few to aim for it o o o Statistical Modeling Test and Learn Automated Triggers Data Quality Marketing Automation

12 Execution Challenges The OM business has many dimensions, including; 5 business units (Life Assurance, Unit Trust, Group Schemes, Health Care and Bank, all targeting individuals; 5 primary customer segments (High Net Worth, High Income, Middle Income, Growing Aspirations and Low Income) 6+ secondary customer segments (Female segment, young segment, mature segment, professional segment, SME segment, farmer segment) 5 channels with different engagement rules (Tied Agents, Brokers, Direct, Group Schemes and Bank Branches) Specific Intermediaries are assigned to specific customers and specific offers 4.5million active and dormant customers Another 4 million prospects from external lists More than 20 offers across hundreds of product permutations More than 540 campaigns and leads campaigns p.a. (ave customers per campaign) 2 3 reminders on some of the campaigns AND, we have limited marketing resources and other internal limitations Limited Budget Limited Capacity Restricted Customer attention Legal Restrictions The complexity is not in the strategy or in the concepts, but in the number of permutations to consider it is basically a numbers game Slide 12

13 Execution Challenges The OM business has many dimensions, including; 5 business units (Life Assurance, Unit Trust, Group Schemes, Health Care and Bank all targeting individuals; 5 primary customer segments (High Net Worth, High Income, Middle Income, Growing Aspirations and Low Income) 8 secondary customer segments (black segment, Gauteng segment, female segment, young segment, mature segment, professional segment, SME segment, farmer segment) 5 channels with different engagement rules (Tied Agents, Brokers, Direct, Group Schemes and Bank Branches) Specific Intermediaries are assigned to specific customers and specific offers 4.5million active and dormant customers Another 4 million prospects from external lists More than 20 offers across hundreds of products More than 420 campaigns and leads campaigns 2 3 reminders on some of the campaigns AND, we have limited marketing resources and other internal limitations Limited Budget Limited Capacity Restricted Customer attention Legal Restrictions 1 more dimension is 3 2(too) many The effectiveness of automated sales decreases Every dimension added to the business model has an exponential impact on the ability to correctly select the right customer at the right time with the right offer Slide 13

14 The solution must be specific to the problem The OM business has many dimensions, including; To understand which customers are eligible for which Value Propositions, we use BI analysis 5 business units (Life Assurance, Unit Trust, Group Schemes, Health Care and Bank all targeting individuals; To estimate the likelihood that a customer will respond to that offer at that time, we use Propensity Models 5 primary customer segments (High Net Worth, High Income, Middle Income, Growing Aspirations and Low Income) To generate the actual campaigns across these many permutations requires robust tools, we use Marketing Automation 8 secondary customer segments (black segment, Gauteng segment, female segment, young segment, mature segment, professional To segment, get the feedback SME segment, from the farmer channels segment) requires an integrated Leads Management System, we use a custom web based system 5 channels with different engagement rules (Tied Agents, Brokers, Direct, Group Schemes and Bank Branches) Specific Intermediaries are assigned to specific customers and specific offers 4.5million active and dormant customers Another 4 million prospects from external BUT, lists none of these applications are effective in looking ahead in More than 20 offers across hundreds of time, products using the marketing schedule and selecting those offers that will be the best for: More than 420 campaigns and leads campaigns The Customers needs; 2 3 reminders on some of the campaigns The Channel (Intermediaries) needs; and AND, we have limited marketing resources and other internal limitations Limited Budget Limited Capacity Restricted Customer attention Legal Restrictions Collectively the solutions required to solve the challenge is built layer on layer with Business Intelligence still the foundation... Slide 14 The meeting the Business s objectives (GEAR) AND, none of these applications are effective in estimating the: Best use of the resources; and the Best profit potential

15 The solution must be specific to the problem The OM business has many dimensions, including; Understanding which customers are eligible for which Value Propositions, we use BI analysis 5 business units (Life Assurance, Unit Trust, Group Schemes, Health Care and Bank all targeting individuals; Estimating the likelihood that a customer will respond to that offer at that time, we use Propensity Models 5 primary customer segments (High Net Worth, High Income, Middle Income, Growing To Aspirations and Low Income) Generating maximisethe the actual campaigns across these many permutations requires gain across robust tools, the we use Marketing Automation 8 secondary customer segments (black multiple segment, Gauteng segment, female segment, young segment, mature segment, professional Getting permutations segment, the feedback SME segment, from the channels farmer segment) requires an integrated Leads Management System, we use a web based system 5 channels with different engagement rules (Tied Agents, Brokers, Direct, Group Schemes and Bank Branches) BUT, none of these applications Requires are effective a different in looking toolset ahead that: in time, using the marketing schedule and selecting those offers that will Specific Intermediaries are assigned be to the specific best for: customers and specific Uses the offers MA campaigns as input 4.5million active and dormant customers The Customers needs; Generates a customer view Another 4 million prospects from external lists The Intermediaries needs; Looks andahead in time More than 20 offers across hundreds of products The Business s needs Uses organisational parameters More than 420 campaigns and leads campaigns Limits customer fatigue 2 3 reminders on some of the campaigns Provides What If analysis AND, we have limited marketing resources and other internal limitations Limited Budget Limited Capacity Restricted Customer attention Legal Restrictions AND, Using none the of these applications are effective in estimating the: implied Best use of the resources; and the limitations & potential Best profit potential Slide 15 Optimises the marketing schedule Collectively the solutions required to solve the challenge is built layer on layer with Business Intelligence still the foundation... And Marketing Optimisation at the top

16 Organisational Success Factors Lots and lots of communication Alignment of all customer value propositions (channels and segment heads) Alignment of all leads, campaigns and trigger generation processes and systems Strong drive to replace legacy leads generation and management systems Increased focus and drive of customer information quality Changed governance to a central body representing total sales contribution Increased focus on automation vs. manual approval of each campaign Increased focus on management information (especially client-centric measures) Consolidation of BI and leads generation business units centre of competence Enterprise-wide drive to standardise toolsets and architectures Budget release to change systems and procedures Old Mutual has achieved a number of critical success factors but is still growing into a fully efficient organisation Slide 16

17 Anticipated Benefits Increased growth from the existing customer base More cross-sales More up-sales More financial solutions within the Old Mutual Group Increased monitoring and reporting Reduced marketing costs:sales ratio Reduced customer fatigue Increased channel effectiveness (difficult to measure) Improved relationship between Head-Office and Intermediated channels Reduced involvement from middle management The benefits from Sales Automation is largely determined by all of the marketing capabilities working in unison with each other Slide 17

18 Questions Slide 18