In a recent DM News article titled “Big Data Must Create Big Experiences”, direct marketing vet Ernan Roman pointed out that for all the data that’s apparently being collected, marketers don’t seem to be doing much with it. And judging by my e-mail inbox, I couldn’t agree more.
An appraisal of the brand and loyalty marketing e-mails I’m receiving reveals scant few that mention my relationship with the company or that address my past buying behavior. That’s a serious omission, because research shows that if a company provides me with personally relevant information, I’m much more likely to make a purchase.
The unfulfilled promise of big data also came up during a recent DM News roundtable. While there were a few on the panel who paid lip service to combining “research, analytics, and transaction data…to produce more tailored communications”, the conversation was long on talk and short on examples.
However, there was one roundtable statement that rang true, and I think it sums up the current state of big data. It came from a straight-shooter by the name of Ilana Rabinowitz, the CMO at a company called Lion Brand Yarns, who said:
“I think that for most small and midsize companies Big Data is irrelevant. It’s like the Wild, Wild West of information. You can’t use it, you don’t have people who can analyze it, and if it’s there, you don’t know how to get to it.”
A damning but, I believe, true claim. And the concerns about big data extend into the loyalty marketing business, as well. A recent report in Retail Wire asks the pointed question: “Why Aren't More Companies Connecting Big Data Dots for Loyalty Programs?” The online pub cited a serious lack of effort on the part of marketers, coming to the conclusion that:
“While most respondents feel the need to engage customers based on their needs and expectations, they're not leveraging the data in a way that maximizes the potential loyalty offered by customers.”
To use a football analogy, big data feels like the first round draft pick who has tremendous potential—but who hasn’t yet proven himself on the field. The coach isn’t quite sure how and when to use him, so for now he’s relegated to the bench. He may play in the future, but when is anyone’s guess.
Is there a better way to personalize customer communications?
Since it appears a lot of marketers haven’t yet gotten a handle on how to use the voluminous amount of data they’re collecting, maybe it’s time to go old-school. I again quote DM sage Ernan Roman who made this astute observation:
Customers, both B2B and B2C, are sophisticated enough to recognize that to receive increasingly relevant offers, they must share detailed preference information.
And if you’re not able to leverage big data, the best way to compile accurate customer preference data is through surveys, both online and off. With this approach, you start a dialogue with customers asking them to share their wants, needs and expectations. This allows you to continue the dialogue by serving up relevant, personalized communications featuring the products, services and benefits that interest your customers most.
For me, this idea is an e-mail blast from the past. Several years ago, my former employer Frequency Marketing had a major client who committed the time and dollars to collect customer information via surveys—and it allowed us to send out personalized, relevant e-mails. The result was a sharp increase in incremental sales and customer share-of-wallet.
Are customer preference surveys the sexiest, most cutting edge way to personalize customer communications? Probably not. But until big data gets its act together, it may be all we’ve got.
This post previously appeared on Loyalty Truth, May 29, 2013.