Here's a way to have 1:1 communication and scale too

I was reading the October issue of 1:1 magazine on a plane today and was struck by an article called "You Talkin' to me?". The article's main focus was on the use of custom communication in marketing but it made some good points about the need for 1:1 communication with your customers. The premise of the article, unsurprisingly for a magazine called 1:1, is that companies must

"execute a customer strategy at a time when consistency and relevance are imperative"

There are lots of reasons why I think this is a broadly true statement. Customers are more mobile and more willing to move to competitors' products than at every before and, thanks to the growth of the Internet, more able to do so easily. Customers have access to more information about companies and their products and are able to pick and choose what to read, watch or believe. Companies are more complex these days - gone is the vertically integrated company and in its place has grown the outsourced, distributed company. With more "moving parts", more third parties, more channels companies are struggling to deliver consistency yet increased regulation and more demanding customers make this consistency more essential than ever. The article's solution to this dilemma is

"targeted marketing that is consistent and integrated across all channels"

Now I don't have a particular issue with this, indeed this is clearly part of the solution. I think it understates the problem though and I think a better solution is maybe something like this:

Precise and timely customer treatments that are consistent across all channels

This is clearly a superset of the article's premise but what does it mean?

• It means considering every action you take that impacts a customer as a customer treatment decision
• It means precisely segmenting (even micro-segmenting) customers and prospects using the richest set of data you have.
• It means delivering optimal decisions in whatever channel your customer decides to use or that you decide to use to contact a customer
• It means treating every interaction with a customer as though you mean it - that it is an explicit choice as it pertains to a specific customer
• It means doing all this in a way that can be constantly improved and adapted in response to a volatile business environment

So how do you do this? Well I have blogged before about the basic process:

1. Identify the operational decisions you make that relate to customer treatment
   Don't let decisions like "what's the message of this campaign" conceal the much larger number of decisions implicit in that campaign e.g. Send customer #1 an offer; Send customer #2 an offer; and so on. Each action taken is a distinct decision.
2. Separate out decision services from the rest of your information architecture so that they can be improved and reused effectively
   As long as these customer treatment decisions are buried in your call center application, email generator, website etc they will not be managed consistently across channels and will be hard to improve separately from other changes in the software.
3. Use business rules as the basic technology for automating these decisions
   Not only do business rules allow those who understand the customer and the marketing/support/sales process to manage the rules they also allow the decisions to be changed rapidly when necessary. Much of the basic personalization discussed in the article can be dramatically improved using business rules.
4. Use analytics to make better decisions
   This might mean mining your data to find the right rules or it might mean building predictive models to help guide decision-making when treating a customer about whom you can infer something useful.
5. Set up an improvement mechanism
   Track, monitor, analyze, improve, repeat.

I have presented on this approach to improving the customer experience and blogged about this trend towards precision marketing before.

Interestingly the same issue had an article on the "GenWeb" generation and it was clear from this that they want more control over the channels used to reach them, more customization, more personalization and that they will tolerate mass-market messages less and less. If you are not managing 1:1 communication with your customers already, soon you will have to.

Technorati Tags: analytics, BRE, BRMS, business rules, CRM, customer experience, Customer management, decision automation, EDM, EDM, Enterprise Decision Management, personalization, precision marketing, predictive analytics