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Big Data & Analytics 101: How Customer Lifetime Value Enhances Predictive Marketing
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Big Data & Analytics 101: How Customer Lifetime Value Enhances Predictive Marketing

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Big Data & Analytics 101: How Customer Lifetime Value Enhances Predictive Marketing

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  • 1. Big Data & Analytics 101: How Customer Lifetime Value Enhances Predictive Marketing Funding Your Big Data & Analytics Journey 2nd Annual Big Data Business Forum November 15th, 2013 - San Francisco, CA JP Bewley, CEO J Patrick Bewley, CEO Oct 16th, 2013 SMARTERMARKETINGSCIENCE SMARTERMARKETINGSCIENCE Start Time: 12:05 Eastern
  • 2. About BIGCLOUD Analytics Today’s Program Host: J Patrick Bewley CEO, Big Cloud Analytics Q&A: Dr. V Kumar Chief Scientist Big Cloud Analytics Housekeeping Items: •  All attendees are in a listen only mode •  The webinar will be placed in a discussion mode for Q&A with Dr. Kumar •  This webinar will be recorded and available for replay on our website Agenda: •  About Big Cloud Analytics •  What is Big Data & Analytics? •  What are the typical phases organizations go through? •  How do you fund investments in Big Data & Analytics? •  (3) Case Studies on Profitable Customer Engagement •  Q&A #BCA101 @BigCldAnalytics
  • 3. About BIGCLOUD Analytics About BIGCLOUD Analytics, Inc. BCA is an Atlanta based Data Science & Analytics company that delivers embedded analytics for: Social Engagement Customer Engagement Employee Engagement We find answers in big data that business leaders care about. •  •  •  •  •  •  •  Who are my best customers tomorrow? What will they buy next? How do I find more like them? Which customers will leave? Which customers should I fire? Which of my sales people will excel next year? Are my employees engaged? Award Winner $6 Billion
  • 4. More Content Here Register To Win – Real Time Text ANALYTICS to 22828 and Register To Win A Signed Copy
  • 5. About BIGCLOUD Analytics Big Data Defined What is big data? Big data is the term for a collection of data sets so large and complex that it becomes difficult to process using on-hand database management tools or traditional data processing applications. VOLUMEVARIETYVELOCITY
  • 6. More Content Here Reality Bytes! DATA DYSFUNCTION vs BIG DATA 300 Brands on Six Continents
  • 7. More Journey It is aContent Here
  • 8. Big DataMore Content Here & Analytics Roadmap Stages Of The Big Data & Analytics Journey Pre-Analytics Prepare Insight Unlock Actualization Put to Work
  • 9. Big DataMore Content Here & Analytics Roadmap Stages Of The Big Data & Analytics Journey I.  II.  Pre-Analytics Envisioning Data Assessment III.  Data Collection IV.  Describe & Codify Insight V.  Predict & Recommend VI.  Engage Actualization VII.  Measure & Refine
  • 10. Big DataMore Content Here & Analytics Roadmap Stages Of The Big Data & Analytics Journey I.  Envisioning a.  b.  II.  Pre-Analytics Data Assessment III.  Data Collection c.  d.  e.  f.  User Experience Mapping Sample Lifecycle Marketing Strategy Day In The Life Data Source Discovery De-duplication Data Hygiene a.  b.  c.  d.  e.  Tagging & Taxonomy CLV/Value Segmentation Next Logical Product In Market Timing Optimal Resource Allocation VI.  Engage a.  b.  VII.  Measure & Refine c.  d.  e.  Marketing Automation Customer Care Interactions Response Tracking Conversion Analysis Recursive Learning IV.  Describe & Codify Insight Actualization V.  Predict & Recommend
  • 11. More Content Here Envisioning: Lifecycle Primary Product Relationship: Rugby Secondary Product Relationship: Jeans Tertiary Product Relationship: Belts & Boots Customer Value Cumulative Lifetime Value “Managing Customer For Profit” – Dr. V Kumar 2008 Time
  • 12. More Content Here Envisioning: Data Use Grid Mapping How Big Data & Analytics Support Your Business Outcomes Point Of Sale Transactions E-Commerce Transactions STRUCTURED: INFREQUENT STRUCTURED: MONTHLY “These boots are too…” Product Returns Social Media STRUCTURED & UNSTRUCTURED: INFREQUENT UNSTRUCTURED: STREAMS “I like this year’s …”
  • 13. All It More Content Here Takes Is Money…
  • 14. More Content Find So Where Do You Here It?
  • 15. Making Data & Analytics Pay Self-Funding Approach to Your Big Data & Analytics Journey Incremental Revenues EVP Economic Value Proposition People, Process & Technology Media Spend
  • 16. Making Data & Analytics Pay Self-Funding Approach to Your Big Data & Analytics Journey Incremental Revenues People, Process & Technology Media Spend Incremental Sales x Operating Profit (%) Current Base Costs -/+ Scale Efficiencies (Build vs. Buy) + Incremental Spend Required Above the Line Spend Media Arbitrage Opportunities + Incremental Direct Marketing Spend Pricing: People, Process, and Technology Direct Marketing Spend: Email, Direct Mail, Banner Purchases, etc. Levers of Improvement Levers of Improvement EVP Economic Value Proposition Levers of Improvement •  •  •  •  •  •  Touch points Engagement factor Marketable universe Response rate Conversion rate Shopping basket value •  •  •  •  •  •  Policies Consolidation Collection Virtualization Standardization Severance expense •  Map media buys to the best customer demographics. •  What data is available on rate cards? •  Do sponsorships align with customer base?
  • 17. Making Data & Analytics Pay Using Big Data & Analytics To Drive Revenue Incremental Revenues Incremental Sales x Operating Profit (%) Point Of Sale Transactions STRUCTURED: INFREQUENT ?? Influencers STRUCTURED: MONTHLY STRUCTURED: WEEKLY Levers of Improvement •  •  •  •  •  •  Touch points Engagement factor Marketable universe Response rate Conversion rate Shopping basket value Conversations UNSTRUCTURED: STREAM We monitored: 825k Conversations (Twitter & Facebook), 1736 Individuals Identified 1000 Influencers with greater than 20% connectivity to community Rewarded Influencers to take action (Share your brownies) Generated 40% Increase in Brand Awareness, 40% Increase in Revenue Growth, 83% ROI Award Winner
  • 18. Making Data & Analytics Pay Using Big Data & Analytics To Save Operational Costs People, Process & Technology Current Base Costs -/+ Scale Efficiencies (Build vs. Buy) + Incremental Spend Required Pricing: People, Process, and Technology Levers of Improvement •  •  •  •  •  •  Policies Consolidation Collection Virtualization Standardization Severance expense We monitored: Gifts, holiday purchases, new category purchases, shopping in new channels Found that the optimal level of product returns was 13% Decreases in product returns below optimal slowly erode profits; 1% decrease profit = $63,937 Increases in product returns above optimal sharply erode profits; 1% increase profit = $20,608 Customers were less likely to return sale merchandise
  • 19. Making Data & Analytics Pay Using Your Big Data & Analytics Project To Market Smarter Media Spend Above the Line Spend Media Arbitrage Opportunities + Incremental Direct Marketing Spend Direct Marketing Spend: Email, Direct Mail, Banner Purchases, etc. Levers of Improvement •  Map media buys to the best customer demographics. •  What data is available on rate cards? •  Do sponsorships align with customer base? We monitored: Longitudinal transaction data, renewal rates, customer care calls Leveraged data to pitch right product at right time to right customer Revenues increased 2.5 times or $1,702, Profits increased by 4 times or $2,681 Marketing costs decreased by $2,190 over the customer tenure Customers Satisfaction increased by more than 63%
  • 20. More Content Here Summary •  •  •  Most organizations aren’t unlocking the value of the data that they already have Prioritize data based on how it will support your business outcomes Where will you fund your Big Data & Analytics project from? •  •  •  •  Incremental Revenues People, Process & Technology Costs Marketing Spend Done right, Big Data & Analytics can support your Customer Engagement and drive big returns
  • 21. More Winner Is? And TheContent Here
  • 22. More Content Here J Patrick Bewley +1 (501) 205-4066 jpbewley@bigcloudanalytics.com @jpbmobile bigcloudanalytics.blogspot.com http://www.bigcloudanalytics.com
  • 23. info@bigcloudanalytics.com (404) 919-0950 SMARTERMARKETINGSCIENCE