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

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