The Role of Analytic Geeks in Retaining Customers
Last Wednesday there was an article in the Wall Street Journal (subscription required) that’s worth revisiting here (Marketers Reach Out to Loyal Customers, Emily Steel, Nov. 26, section B2), because its key message is one that we’ve been talking with customers and partners about a great deal over the past couple months. Namely, in these turbulent economic times it is more important than ever to invest in a company’s existing customers. As Ms. Steel noted, “acquiring a new customer costs about five to seven times as much as maintaining a profitable relationship with an existing customer.” And her main point was that “with the critical holiday sales season at hand, there’s a new character joining Santa and his elves on the advertising circuit: the analytics geek.” Yes, we’re analytics geeks here at Leximancer. And proud of it!
We pay attention to numbers. Of all the information that’s available for companies to use in gaining competitive advantage a mere 20% is addressable by today’s major business intelligence vendors (Oracle, IBM, SAP etc). The other 80% is pure unstructured chaos, which as a result is largely ignored or only sampled in bits and pieces. While just the numbers suggest a problem here, the fact is that direct customer comments—through contact centers, surveys, and self-service support sites for example—are in that 80%. How can solid business and advertising spend decisions be made without careful consideration of customer input? As noted by the venerable Jack Welch, “an organization’s ability to learn, and translate that learning into action rapidly, is the ultimate competitive advantage.”
Marketers need an automatic, systematic and scalable system that can enable unstructured textual information to become a real enterprise asset—good for uncovering new customer insights and unknown customer insights. While Ms. Steel’s article was more focused on targeted advertising spend that leverage quantitative analytics, the companies that quickly address customer comments in a systematic manner are the ones that are taking it to the next level. And while the holiday season brings opportunity to this sort of progressive marketer, our economic conditions demand renewed customer orientation regardless of the season—to both ensure revenue performance as well as reducing the cost of customer acquisition.