Developing a Marketing Data Warehouse for Customer Analytics
Sagence implemented a marketing data warehouse that provided a nutritional supplements direct marketer much needed customer intelligence.
The firm’s initial success yielded a lack of investment in analyzing customer information that would enable insights into drivers for customer retention and growth. It was not possible to study customer behavior patterns, nor to apply learnings to new prospecting efforts. Additionally, the company did not have a way to segment customers by value and to modulate marketing investments for different marketing campaigns.
The Sagence team developed a customer marketing database by integrating information from the company’s Enterprise Resource Planning System (ERP), as well as available promotion history. We created measures of recency, frequency and revenue that could be correlated for analysis of customer behavior. We also worked closely with the client to develop a customer segmentation framework.
The immediate benefit was understanding customers and customer segments. For the first time, the company can pull marketing lists based on multiple measures of past behavior, including product affinity characteristics. Programs have been developed to tie retention and development efforts to the characteristics of specific segments for purposes of retention, cross-selling and ideas for acquisition programs for new customers. The data warehouse is also being integrated with campaign management operations. Longer term expected benefits include a reduction of one-time only buyers, reduction of churn and improved customer transaction metrics.