The key to sales and marketing cooperation is to use data to direct the marketers on the marketing mix and present the prospects most likely to buy to the sales force—a win-win situation that maximizes the effectiveness of the marketing budget and delivers the all-important commission to the salesperson.
Information-gathering is natural for the sales force and marketing functions but has been a disparate activity suffering from the natural tendency to contain information in silos of activity within departmental boundaries. I always envisage it as a young child in school carefully using his arm to shield his math test paper from his neighbor!
The sheer volume of information available as a result of the Worldwide Web; data acquisition from customers and prospects through CRM systems and corporate web sites; and intuitive data analysis tools means that customers and prospects can be profiled and presented with relevant offers at the right time. It also means that the company has the opportunity to develop a true relationship with its customer. Marketers can find that product sales are dwindling and response to their once-attractive offers reduced. This may not be because the product is any lower in quality or that the price has leapt or the sales force is any less diligent; it can be that the customer profile once associated with that product or market has changed.
An international business journal publisher operated a number of teams supporting different market sectors, which represented a huge number of isolated data silos. Exploiting the knowledge contained in these silos was essential to the provision of enhanced and new services for its customers, and increasing revenues. The company also incorporated external data, enhancing the knowledge base and providing insight into customer buying patterns with competitors, giving its advertising sales force the weaponry it needed to fully evaluate customers and plan up-selling and cross-selling strategies.
Essentially, the sales team must be able to recognize new viable targets to effect and maintain sales strategies. Constant data feeds with triggers identified to drive proposition, communication channel and delivery can serve as early warning of changes in segments and individuals.
This selection of customers and appropriate propositions can then be fed directly to the sales force in the field or to sales agents in a call center or to drive variations in web pages. In all cases, the sales effort is being directed from the view of the best opportunity for the business and, as such, can achieve the greatest success and protect the cost-effectiveness of the marketing and cost of customer acquisition.
A major U.K. insurer was experiencing a high level of customer churn, and it was costing a great deal of money to recruit new customers. While the company attempted customer retention initiatives, it identified the problem as one of customer attitude and profile. The loyalty spectrum spreads from the “customer-for-life” to the transient customer who changes insurance company at each renewal.
Using historical data from the policyholder database and combining it with information acquired from external demographics and lifestyle databases, the company built up profiles for each type of product (motor, domestic, travel, etc.) in relation to its renewal behavior and applied scoring techniques to determine whether the individual was likely to continue or defect, come renewal time.
The company applied this model (refreshed regularly with new data) to existing clients with a view to controlling how much was spent on retaining their business and to new proposers or enquirers regarding their potential value and, so, how much could be spent on recruitment. In this way, it was able to apply the marketing and sales budgets more efficiently where they would do the most good and direct the sales effort directed to the most profitable business, meaning better earnings for the sales force.
The concept of sharing the data for the common good, however, does have implications on the culture of the business, in the same way as the introduction of a CRM strategy will—and is as far reaching in that the knowledge culture affects the business as a whole. As it grows and the sales success is established, so the interest in data throughout the enterprise also grows. The benefits of combining information from different departments, from different regions, even from different businesses are being realized, and so the sales guys in the front line can understand the need for care when collecting customer data, as it is going to drive their earning potential.
This overall concept aims to establish a process for linking both internal and external marketing data and the implementation of customer relationship management.
© 2006 Michael Collins. All rights reserved.