All Things Data

Master Data Management and Customer Retention

In these economic times, organizations are focused intensely on customer retention and preservation.  A key part of preservation is an organization’s ability to gain repeat orders or contract renewals with their existing customers.

As people and not institutions are the one who make buying decisions, it is mandatory for organizations to communicate with all of the contacts at their customer locations who are involved in buying decisions.  However, every day on the news you hear more and more about company layoffs.  Further, the economic situation is predicted to get worse before it gets better and therefore some key contacts may no longer be at the company.  Consequently, it is critical for an organization to have a data integration/data management strategy to make sure that you are able to communicate with all influential contacts at your customers.

Master Data Management or Customer Data Integration software can help you correlate all of the contacts that you have with an organization.  These contacts could be spread across multiple data sources and the same or related contact and entity names can be presented in a variety of different ways.  If your key contact at a company leaves, it’s imperative that you have backup contacts at the organization so that you can continue the relationship.  Further, it’s important that you do not wait to communicate with the influencers at an organization until your key contact leaves because at that point it may be too late to build the relationship.  Additionally, an organization cannot rely on its sales reps to be the sole builder of the relationships with the additional contacts.  The sale rep may not be focused on building the relationships with all of the influencers.  Further, if the sales rep leaves your organization and the customer contacts are not correlated in the database, then the client contacts and relationship may be lost forever.  In these uncertain economic times, the risk of the loss of an existing client relationship is not one that an organization can afford to take.

Master Data Management and the Multiple Match Project Uses for the Mid-Market

I was speaking with Steve LoCastro from BDS and one of the things that he wanted to point out was how many different uses a Mid-Market organization can get in a single Master Data Management match project.
 
Mid-Market Master Data Management solutions are usually driven by one specific issue.  We can’t get certain reports, we want ours reps to have a single customer view to up-sell and cross-sell, we have data quality problems, or other issues.  Typically, however, once the Master Data Management system is starting to be put in place, the Mid-Market firm starts to realize that they can gain additional benefits that they never foresaw when the MDM project was first authorized.  Sometimes, the “secondary” benefits become as important as the initial objective.

For example, a Mid-Market organization may have two databases that they want to synchronize such as a Communication System (like Outlook or Lotus Notes) and a CRM system.  The challenge with synchronizing these separate data sources is that there are multiple representations of the same or related organizations and contacts within these two systems.  The different ways that these multiple representations have been entered in to these separate data silos, such as abbreviations, incomplete information, spelling mistakes, etc., makes the synchronization even more difficult.  Therefore, in order to sync these two systems up, a Master Data Management match focusing on Customer Data Integration needs to take place.

Once complete, the organization is now able to tell from the Master Data Management match project which records are in both systems and which records are in one system and not the other.  With this information, the synchronization process can then be put in motion. 

Additionally, by changing the way that the same Master Data Management match project is queried, information such as duplicate records, missing data elements, and other data quality issues can also be addressed on the same records at the same time the company is benefitting from the syncing of the two systems which was the initial goal.  If there is other valuable reference data, data that is part of the data sets that are being matched but are not used in the match itself, then additional analytics can be performed, such as marketing analytics, all from the same Master Data Management match project.

The “Right” Count and Master Data Management

As the economic situation remains uncertain, many organizations have begun to downsize their staff or are thinking about downsizing their staff. 

In many organizations, sales expenses can be the most costly part of an organization making it a tempting area to cut. Still, at the same time, the lifeblood of any organization is its sales.  How does an organization reduce its sales expenses without actually hurting the organization more by not having the appropriate staff to find and follow up on the opportunities?

The key to making any decision regarding the number of sales employees is having a clear understanding of the market opportunity.  Now, more than ever, Master Data Management, also referred to as MDM, is needed in order to make these critical executive decisions.

Master Data Management can help you match and link the multiple representations of the same organization, same contact, and related organizations and contacts that are located within each separate data silo and across disparate data systems.  Once matched and linked, you can see how many customers and prospects that you have within your database systems.  You can further analyze this information by geography, product line, or other criteria or combinations of meaningful criteria to further define the market opportunity. 

To gain even further insight into the market opportunity, you can use your MDM solution to match and link external marketing files against your internal databases so that you can identify locations and contacts that match your customers and prospects that you do not already have within your database.  External files can also provide organizations and contacts that fit the profile of your best customers even if you do not have matching records in your data silos.

Once you understand the market opportunity, you can start to plan for the “right” count of employees based on the market opportunity and not some random reduction of head count which may hurt sales.  Since your best customer is your current customer, a master data management application can also help organize your databases based on corporate hierarchies so that your sales and marketing staff can work the family tree where your organization is already a trusted source.  

While for many large enterprises implementing a master data management solution may take some time to implement, many smaller and medium size organizations can implement a MDM system in a reasonable amount of time and gain more immediate insight in order to determine the “right” count of sales employees sooner rather than later.

Utilizing Customer Data Integration To Do More With Less

Here are 3 ways that utilizing customer data integration in order to build a single customer view can help your organization do more with less:

1.  Your best prospect is your current customer.  Customer Data Integration can help you correlate records in your databases that are part of the same organization.  This can enable you to enhance marketing to your existing customer base in order to gain a greater share of wallet with your current customers.  The built in referral from already having done business with another part of the organization shall give you a greater chance of success and be less costly than other outreach efforts.

2.  Allocation of resources – How many unique customers do I have?  How many unique prospects do I have?  Where are my customers and prospects located?  Which industries or other marketing segments are my customers and prospects in?  With so many representations of the same organization and so many different locations for these organizations in your databases many times the answers to these questions are not so simple.  However, customer data integration can help create the organizational hierarchies and enable you to properly count your customers and prospects based on the segmentations that are meaningful to you.  With this information, you can properly allocate the correct number of employees and other resources that are needed to market and service these segmentations.

3.  Market Consolidation – Maybe you are in a position to acquire a competitor or to take on a complimentary organization that adds to your offerings.  In order to get the true benefit of the merger, you need to consolidate the other organization’s data into your systems so that you can capitalize on the opportunity that is created by the merger.  Customer data integration can be used to help you identify the unique and the overlap among the organizations.  As mentioned above, a CDI match can help you create the corporate hierarchies of the customer and prospects of the two combined organizations so that you can maximize the opportunity created by the consolidated organizations as well properly allocate your resources so that you get maximum return on your investment.

Data Understanding

In speaking with Steve LoCastro from BDS, he pointed out at an interesting phenomenon when we are engaged in a customer data integration application to develop a single customer view, data analysis, data quality, or other solution.

While there may be a technical person or a team of technical people who know the company’s data in detail, many times the business end-user who is asking for assistance does not know their company’s data with specificity.  They do not how certain pieces of information are represented or calculated in their databases.

Consequently, the business user will ask a question and the results may be unexpected.  Sometimes, after some research, it is discovered that although the results are correct based on the question, the question itself needs to be changed.  The question needs to be more specific and take into account the subtleness in their data in order to obtain the results desired.

Therefore, one of the great side benefits from a business user’s perspective in getting involved in a customer data integration, data analysis, or other related initiative is that for the first time they start to gain an understanding of the company’s data with some specificity.  Sometimes, this side benefit is simply learning about data that they did not know even existed.  This understanding enables the business user to start thinking about how they can use their data in ways that they had not thought of before leading to better analysis and decision making.

Top 8 Reasons to Implement a Customer Data Integration System

Here are the top 8 reasons to implement a customer data integration system:

1.  Report and Data Mine Utilizing Separate Data Silos
2.  Develop a Single Customer View for Up-selling and Cross-selling
3.  Consolidate Multiple Databases After a Merger or Acquisition
4.  Correlate Data for Corporate Hierarchies
5.  Identify Data Quality Issues
6.  Discover Duplicate Records
7.  Append External Marketing Data to your CRM System
8.  Build a New Database System

Customer Data Integration, Outlook® and Lotus Notes®, and Building a New Database

Previously, I wrote about integrating your communication systems, such Outlook and Lotus Notes, with your CRM, accounting, and other databases in order to develop a single customer view using customer data integration (“CDI”).

However, in many organizations, even if some individuals or departments have a customer relationship management system or contact management database, not everyone is on the same centralized system.  Therefore, in these organizations, Outlook or Lotus Notes are the true central repository of the company’s customers and prospect information.  At some point, the organization may realize that these communication systems have limitations when it comes to sales, marketing, and customer service objectives and therefore would want to adopt a centralize customer relationship management system for their customers and prospects.

A CDI system can use the information that is in Outlook or Lotus Notes in order to help build a new database.  The customer data integration matching and linking process can identify all of the companies, contacts, and addresses that are part of the same or related organization.  The CDI match can identify the overlap and duplicate records among the many Outlook and Lotus Notes users in your organization.  Further, the customer data integration solution can help you identify and organize the data into corporate hierarchies.  The match results then can be used to populate and organize the new customer relationship management solution.

Once the new CRM system is built, you can continue to use your customer data integration software application to integrate the CRM database with Outlook or Lotus Notes, accounting and other financial systems, marketing databases, and other separate data silos in order to develop a single customer view.  This single view of the customer can be utilized to improve sales, marketing, and customer service.  IT can also use the customer data integration match results to manage duplicates, organize corporate hierarchies, transfer records between systems, and other data management and data quality issues on an on-going basis.

Customer Data Integration and B-to-B Multi-Channel Marketing

In today’s world, business to business marketers need to provide their customers and prospects multiple channels so that their customers can communicate with your organization in the manner that meets the customer’s needs.  Depending on the type of business, a customer can buy or interact with your organization on-line, by email, by mail, by phone, through a reseller, at a trade show, or some other method.

A single view of the customer is necessary so that you have a complete understanding of the history with that customer.  Customer service can be improved by understanding the full relationship with that customer.  A single customer view enables sales to up-sell and cross-sell utilizing the knowledge of all of the transactions, communications, and other relevant information with the customer.  Marketing can analyze the complete business intelligence with a customer and be able to generate reports and campaigns by associating all of the interactions from the multiple channels that the customer chose.

However, the challenge is that the same or related customer information may be entered in different ways at these various venues.  This makes it difficult to have a single view of the customer.  For example, if you are a b-to-b multi-channel marketer, person “A” may contact your organization through your website.  Person “B” may contact their value added reseller who forwards the request on to your company via email.  The first person may submit the information with the full company name spelled out.  The second one may abbreviate the company.  The combinations of the company name, addresses, contact names, and the methods that are used to contact your organization are endless.

Customer data integration (“CDI”) can match and link the various interactions with your organization from the multiple channels that client has used.  The CDI solution can match the various companies, locations, and contacts that are related in order to develop a single customer view.  With a complete single view of the customer, sales, marketing, and customer service can be improved by utilizing all of the business intelligence for that customer or prospect.

Customer Data Integration and Correlating Related Records

A well known business adage is that your best prospect is your current customer.  In today’s tough business environment, the first place to look for new business is up-sell opportunities with your existing customer base.  As a related concept, the next best place to look for new business is cross-sell opportunities with a prospect that is related to your current customers.

Related organizations can be found both within your existing database and external marketing files.  Customer data integration (“CDI”) can be utilized to correlate related records to develop the single view of your customer that includes both the organization that you are dealing with and those that are related.

Using the matching techniques from a customer data integration solution along with any linkage that exists in your internal database systems and external sources, a single customer view can be developed so that you can see all of the individuals, locations, divisions, departments, and parent/subsidiary organizations that are related to your current customers and contacts.  Once identified, you can ask your contacts at customer “A” for referrals at related company “B”.  With this reference, you now have credibility as you approach the new opportunity.

Customer Data Integration and Articulating Business Valuation

When a company is thinking about instituting customer data integration (“CDI”) to develop a single customer view, usually the organization is trying to better utilize their data to increase sales, decrease costs, and better serve customers.  However, in addition to helping improve the day to day operations, customer data integration can also help articulate the value of an organization to outside parties.

Many organizations sell to different individuals, locations, departments, divisions, and subsidiaries within the same organization.  There may also be indirect sales through distributors, consortia, and other third-parties.  This combination may make it extremely difficult for a company to track how much business they are doing with any particular organization.

When a company is looking for investors or needs to value its business for some other purpose, one critical factor in evaluating an organization’s worth is understanding how much business that they are currently doing and how much potential business is out there.

Customer data integration can help develop the single view of the customer needed to calculate account penetration and market penetration.  With a single customer view, all of the sales to the same organization, whether they are made directly to various units of an organization or indirectly through third-parties can now be properly identified.  Once identified, an accurate calculation as to how much business you are doing with that organization can be made.  Further, using comparisons with other similar organizations in your database, you can calculate the potential opportunity for that account.  By adding all of the potential with each account, you can calculate the market potential that you have within your current customer base.  Combine your customer base market potential with an external database that contains the entire market and the full market potential can now be articulated.