Connect to Your Customers --------------- Personally, powerfully and profitably by Karl Schumacher President Pitney Bowes docsense Document Messaging Technologies Historians say that there are no enduring strategies, only enduring interests. The enduring interest of business, regardless of size, location or industry, is to attract and retain customers, grow customer relationships, and use those relationships to increase revenues and improve profitability. A way to achieve that goal is to strategically use the regular or monthly account statement or bill to connect with the customer. In fact, one respected industry analyst points out that in the credit card processing, insurance and banking industries, as much as 80 percent of all contact with customers is accomplished via the account statement. The customer statement is the single most regular and reliable customer touchpoint. But the real key to unlocking the potential of the customer message and the relationship it helps create, nurture and sustain with customers -- lies with how the message is generated and processed. Specifically, the ideal approach treats all of the interdependent activities related to the process of creating, producing and distributing the message, handling the response generated by the outgoing message, and updating the customer data file with pertinent response details, as a five-step, closed-loop process. Ideally, this five-step process also encompasses all data related to the customer that is obtained from all customer touch points or interactions, such as direct marketing messages, outbound telemarketing appeals, inbound inquiries to call centers, and responses to TV, radio and Internet advertisements. Capturing and incorporating this data enables subsequent customer messages to be highly targeted and far more effective. Scores of high-volume, print/mail finishing centers are already well on their way to implementing this advanced approach. In fact, many have already achieved dramatically faster processing speeds along with superior mail piece integrity by linking together all of the resources related to producing the customer message and managing them as a single, integrated process.
These resources typically include the print, mail inserting and presorting functions and comprise the core of the modern automated document factory concept. By the true leaders in our industry are reaching further and deeper into their organizations to tap into and link-up with the additional functions, such as the marketing people responsible for creating specific messages, and the IT organization responsible for processing responses and assuring accuracy of the customer database. These visionary managers understand that customer messaging is a five-step, closed-loop and totally integrated process. And by aligning key internal resources with the production and distribution function resources traditionally associated with the print/mail finishing activity, they are achieving improvements in both efficiency and effectiveness that far outweigh what they might accomplish by focusing on just one of the components in isolation. Prompt Processing and Delivery Certainly, the concept of the automated document factory -- and the availability of high speed, high integrity processing and reporting and control systems -- has yielded faster cycling speeds, better mail piece integrity, and higher throughput for print/mail finishing operations. And when combined with techniques like print stream engineering, software for postal hygiene, and presorting via either mechanical or electronic means, the result is faster processing, higher productivity, lower costs and faster delivery through the USPS mail stream. Assured Privacy More recently, a new emphasis on consumer privacy has emerged. This new focus comes from several sources and is clearly a priority for the future. First, privacy is a natural outgrowth of our industry's existing effort to boost mail piece integrity, both as way of assuring customer satisfaction and to help achieve better performance by eliminating errors and improving throughput. If you define integrity as creating and delivering a perfect mail piece, it just makes good business sense to provide it. Indeed, many consumers now 'expect' nothing less than perfection in their dealings with business partners. Plus, the elimination of errors means a less costly and more efficient production process, which helps lower costs and boost efficiency over the long haul. Second, there are significant legislative and regulatory initiatives underway, most notably the Gramm-Leach-Bliley Act, which concerns the privacy of consumer financial information, and the Health Insurance Portability and Accountability Act, which impacts how consumer health and medical information can be handled and communicated.
The Gramm-Leach-Bliley Act will restrict how financial related firms can share or otherwise disclose consumer financial information, and includes requirements to: (1) inform consumers about how the firm intends to share information; and (2) provide a mechanism for consumers to 'opt out' or otherwise prohibit the sharing of personal financial data. The Health Information Portability and Accountability Act, also known as HIPAA, is a new Federal regulation meant to assure, among other things, that an individual's private health care data remains confidential. Although HIPAA became law in 1996, it remains a 'work in progress' since the Bush Administration recently announced a delay in its full implementation. Still, for firms involved in health care insurance, for example, the impact of HIPAA will be significant and will center on the need to implement technology and procedures to assure that confidential health care data contained in both paper and electronic statements and other documents cannot be misassembled or misdelivered, or otherwise disclosed either inadvertently or intentionally. Lastly, the rapid growth of additional communications channels, which is unleashing a virtual flood of marketing messages aimed at consumers, is likely to spur even greater consumer interest in privacy. Just two examples: where once there were three television networks, there are now more than 100 cable and satellite TV channels, each delivering urgent appeals from sponsors or programmers. Tuning them out is becoming more of a survival skill than a prerogative. And while the Internet has become indispensable for businesses and consumers alike, it has become so largely because of funds provided by advertisers seeking to leverage its efficient delivery of marketing messages to both mass and niche audiences. In fact, to cite a third but more extreme example, the 'spam' that clogs our e-mail in-boxes and angers so many recipients today is made possible by marketers who are satisfied with a response rate of only 25 out of every million messages sent. So the 'privacy' -- or at least the daily routine-- of millions of consumers is being violated everyday by an avalanche of unwanted messages. Personal and Powerful Which leads to a unique dilemma for business today. Marketers are reaching out to consumers in a variety of channels -- such as outbound telemarketing calls, inbound call centers and Web-based advertising. But consumers cherish their privacy and are increasingly resistant to and even angered by -- marketing techniques such as dinnertime telemarketing calls and the intrusion of spammer s random or unwanted mass e-mails.
Yet, at the same time, consumers want the relationship with the organizations that they choose to do business with -- i.e., their partners -- to be efficient, accurate, comprehensive and custom-tailored to their needs. Consumers today expect that their 'partner' organizations will collect, update and verify all transaction-related data. They expect that one division or department will know about the purchases they made through another. And they especially don't want the burden of furnishing the same data, i.e., address information every time a new order is entered. In effect, consumers today want to be treated like an important repeat customer when they make repeat purchases -- and they expect their business partners to provide the essential record keeping. Call Center Coordination As a result, innovative businesses are now transforming their conventional call centers into multi-channel contact centers that support telephone, e-mail, the Web, and wireless technologies. This strategy provides customers with more service and contact options while reducing the number of 'live' calls that customer-service representatives (CSR) handle by phone. However, customer-service representatives must have instant access to the complete view of a customer's transaction history across all channels -- especially the mail channel, which is still the most popular by far among consumers -- to perform two critical functions. The first involves responding to inquiries from customers concerning the status of account statements and other critical messages, such as orders, payments or remittances, credit card and loan applications, contest entries, contracts, and shipments of products. The capability must be linked to track and trace data sources to encompass all U.S. public and private carriers, including the USPS, UPS, RPS, Fed Ex and others. It must also include both paper-based and electronic messages. The second function involves responding to customer inquiries about the entire 'as-built' content of the account statement, including all enclosures and statement-related messages and offers. This capability is increasingly important as statements become more highly customized via 1:1 marketing techniques. And this capability must also include statements in both paper-based and electronic format. Marketing Automation The principal reason that customer account statements are morphing into high-value, customer-focused, 1:1 messaging tools is that consumers 'open and read' transaction-
related documents with far greater interest than virtually any general marketing piece, regardless of channel or format. As a result, marketing messages or campaigns included with the statement benefit from greater penetration and response. An effective account statement/marketing automation program will encompass the following key elements: Identifying and segmenting existing customers into groups to receive marketing messages. Targeting the campaign to either individuals or households, and applying intelligent rules to identify the right person in each household to receive the offer. Personalizing the message content to individuals according to the needs of both physical and electronic distribution. Billboarding or customizing message content for individuals according to other content contained in the physical or electronic statements. Coordinating and optimizing distribution of inbound and outbound messages over both physical and electronic channels. Managing the end-to-end workflow of campaign activities such as planning, budgeting, execution and tracking. Applying campaign limits via the use of intelligent rules to restrict the cost of individual campaigns, the number of times a customer can be targeted annually, or other guidelines to help assure cost-effectiveness. Executing or assuring the actual delivery of outbound messages to segments or targets via a specific delivery channel. Tracking the resulting inbound response from customers to a specific marketing appeal delivered via the outbound message stream. Measuring the return of each campaign and incorporating those finding to boost response to the next marketing effort. Scheduling key campaign and messaging activities either automatically or as frequently as needs dictate. Integrating these messaging activities with other CRM components. Increased Profitability
Virtually all of these activities serve to improve the profitability of customer messaging. But if there is one glaring omission or persistent drain on profits today it is the perennial problem of returned mail. For whatever reason, hundreds of businesses and government agencies alike choose to ignore the problem of returned mail. Which is unfortunate because recent advances in technology now enable managers to dramatically reduce the cost and number of returned mail. Organizations implementing data quality software solutions routinely report achieving a 50 percent reduction in returned mail in just three to six months, depending on the frequency of mailings. This is a huge hard-dollar savings in postage, materials and labor for virtually any organization and those savings flow directly to the bottom line, helping to bolster overall profitability. For example, a major life insurer based in the Southeast implemented the solution and reduced its volume of returned mail by half -- in less than a year -- yielding an annual savings of nearly $600,000 in lower postage, materials and labor costs. In conclusion, the mail communications channel is a critical business process, not only to ensure compliance and cash flow but also to help deliver a consistent and complete experience to a customer or prospect. It should increase customer loyalty and satisfaction as well as leading to extra value for and from that customer. The senior leaders of enterprises are increasingly recognizing that a total closed loop customer communication process cuts right across their organizations. They are recognizing the power and profitability of one to one connection with their customers.