Walking the line – DIRECT Magazine

On a whirlwind visit to Australia for the SAS Forum Australia and New Zealand 2010, Jim Davis talks to Nicole Thomas about the latest advances in technology and the implications these can have on the direct marketer.

Jim Davis, senior vice president and chief marketing officer at software solutions company, SAS, is a renaissance man—beyond his work at SAS, he is co-author of Information Revolution: Using the Information Evolution Model to Grow your Business and serial blogger on In Other Words. As one of the keynotes at this year’s SAS Forum Australia and New Zealand 2010, he enlightened the audience on the impact of social media, how to tread in this new territory, and the necessity of good quality data.

How can marketers break through the anonymity of the internet?

I believe we have to look at the internet as not a sole source of information but something to supplement a lot of the data sources that are already available to our organisations. The more successful companies I have seen look at the internet as a channel or a source of information that they marry then with their own internal systems—structured data that exists in the systems as well as purchase data from the outside. Then, if we look at transaction history within our organisation as well as demographic information that we have acquired ourselves or through a third party, then what’s going on in the internet can be used to supplement that and then pushed back out in the form of a more tailored offering to someone we’re trying to deal with.

My biggest concern with the whole medium is potential abuse. Everybody is getting access to it, everybody is forming a ‘social media department’ within their organisations and people are being hired that are supposed to harvest and then participate in these networks. If we attempt to commercialise the traffic on things like Twitter and Facebook I think we run the risk of alienating the audience and what they’re really all about which is openly sharing their experiences and their feelings. People are going to become guarded and we’re going to lose this gem that we have out there right now.

How do you think marketers can tread that fine line between helping the consumer and being seen as voyeuristic?

That’s really difficult. I think there’s a lot of watching going on, it’s just a matter of what you do with the information that you’re gathering. I think you just have to be conscious of it and you have to treat it with respect. You know what, if you don’t the consumer is going to make you honest. Don’t cross the line because you will be pushed back whether you like it or not and it will have an effect on your brand. And then it gets to some of the tools. A lot of the data monitoring tools are incredibly powerful. You can do a lot of good with them, but you can also abuse them as well. The technology is wonderful, but don’t abuse it.

In regards to direct marketing I believe if we don’t abuse it, this concept of customer experience management can be a win-win for the company and the consumer. ‘I won’t waste your time with things that you’re not interested in. I will provide you with what you’re really interested in.’ That’s the dream. You’re not always going to get it right but that’s the dream. The reason you’re not always going to get it right is because it’s down to data quality issues.

What are some of the trends we’ll be seeing in direct marketing?

I think if we look at future technology trends, I think mobility and location-based services represent an enormous opportunity for people. But this issue of respecting people’s privacy and the way in which they want to deal with you has to be taken into consideration.

We deal a lot with a really large theme park in the US and there’s a lot that they could do with location based services. Let’s imagine you’re in that theme park all day long and then you go back to your hotel room that the theme park also owns, turn on your TV and then you see where you’ve been that day. And then based on park volume they can say they know what rides are going to have the big lines and say, ‘Based on what you did yesterday, based on your kids ages and what they did, and what we know about the theme park population tomorrow, why don’t you take this path tomorrow.’ So they can start levelling things out.

Is this technology being fully utilised?

I don’t think so. Not from a marketing stand-point. I think most people are dealing with some of the basics. So if you think about where we’ve been in direct marketing, first we dealt with customer segmentation, and campaign management. A lot of people are still trying to get to that point. Then it is, ‘let’s take it a step further and let’s talk about response rates and rather than looking at a single offer. Let’s start looking at a campaign of multiple offers and adjust it over time based on how people are responding.’ Then we start looking at channel optimisation. If I’m going to market to you, should I hit you first with a mail and then with a phone call and then you’re going to go by the store? So I think there are all those issues that people are still wrestling with and we all hear about the debates around data privacy and I think people are just saying, ‘I know that’s available to me, but I’m not going to make the jump yet.’ But I do think that the wireless providers are going to push that first. I think they’re providing the platforms, they’re letting organisations know this platform exists. So I think the wireless providers are going to make it much easier for people to jump in.

What are some other trends you’re seeing?

Real-time is an over-used word but I really do think that what we’re finding is that from a marketing perspective, you think about traditional marketing there is a lot of data modelling that’s done to look at the propensity to buy by a particular population and from that you build campaigns. What we’re finding is that people want to take those models and put them in line in the operational systems so that you can deal with the customer prospect at the point-of-contact rather than in a batch environment and send them an offer. So a call-centre has it available to them, or we see a lot of what we call customer experience analytics, which is based on your interaction on that website. It’s not just what pages you go to, it’s where was your mouse on that screen and how long was it there? That’s becoming popular. So it’s everything from website optimisation to ‘what did this person finally buy and path did it take to get there?’ Critical stuff.

Does customer experience management bracket what you were just saying?

Everybody’s talking about CRM and I think that’s great, but I think we need to take it up a step to CEM which is customer experience management and look at it as the next step where marketing is a component and the marketing organisation is in the drivers seat for that. It’s an opportunity for the marketing organisation to become more strategic. What’s your responsibility for product development, what’s your responsibility for tech support and how do we weave that together so the customer has a total experience with the organisation over time? It’s not just a one-shot product deal.

What are some of the pitfalls you think direct marketers are falling into?

The biggest one I would say is a lack of appreciation for data quality and what it truly takes to get good quality data in support of the analytics. Things like data quality, data federation and data management—these are all really hot topics out there right now. The analytics and the tools are really powerful and I think too often people jump right to the analytics and don’t take time to look at what are the sources of information and are they really worth mining.

I think the other thing I see emerging within organisations is this concept of an analytics centre of excellence, ACOE. It’s important to have these people who are very well trained, they’re data modellers but within those individuals there’s a lot of valuable IP [intellectual property]. So what we see organisations doing now is forming analytics centres of excellence where experiences, past projects, are registered. It’s like a help desk for analytics. What data sources were used in the past, was it accurate, was it valuable. You have a repository of what has happened within the organisation and what has worked and hasn’t worked in the past. It’s cost effective too, because it will force an inventory of data of tools and very quickly you will realise there’s a lot of data and tools scattered around the organization and so there’s a lot of waste.