❱ 4 ❱ 6 ❱ 20

Special Executive Modernization

Report: Roundtable: in a Big Data
Marketing Quality not world
automation quantity

PM 4 0 0 5 0 8 0 3

Vol. 27 • No. 10 • OCtober 2014 The Authority on Data-Driven Engagement & Operations

Should you
catch the
big data
wave?
❱ 12 Courtesy CenturyLink Technology Solutions

William “bill” Peterson runs marketing & strategy for CenturyLink Technology Solutions’ Big Data efforts.

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Vol. 27 | No. 10 | October 2014 ❯❯18

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The trouble with
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SPECIAL REPORT
Marketing automation:
CONTRIBUTING WRITERS
Dina Al-Wer Brian Jones marketing’s best kept secret
Yvon Audette Geoff Linton
Richard Boire
Information Builders
William Peterson
Jonathan Schloo
❯❯6
Interactive Intelligence Marc Smith EXECUTIVE ROUNDTABLE ❯❯20
Quality not quantity Modernization in a Big Data world
DM reader roundtable concludes “good data
LLOYDMEDIA INC. trumps big data”
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special Report // 4

Marketing automation:
marketing’s best
kept secret
Enrich your sales pipeline with
analytics by integrating CRM
and marketing

❱ DMN.ca October 2014

special Report
By Jonathan Schloo
I
t’s an age-
old problem:
Sales and
marketing don’t
work well together.
Marketing
thinks sales isn’t
following up with
the leads they’re driving. Sales thinks
marketing isn’t driving enough quality
leads. What’s the solution to fix the
misalignment between marketing and
sales? Integrating your CRM system
to support your marketing efforts will
provide analytics that are crucial for
both marketing and the sales team,
and this will drive bottom line results.
In the August issue of Direct
Marketing, in my article about mobile
CRM, I promised to share the secret to
where the money and increased profits
are truly driven from - it’s marketing
automation.
If you don’t know much about
marketing automation, here is a brief
introduction. Marketing automation
is a technology platform for marketers
to create, nurture and pass leads to
sales. Most marketing automation
platforms (MAP) have functions for
email marketing, social media, contact
list management, forms, landing
pages, website tracking and reporting.
Marketers use this technology to
execute marketing campaigns in
a scale that provide a customized
experience to their audience.
There are a number of marketing
automation platforms that provide
all the features mentioned above, but
the key is having a system that fully
integrates with your CRM system to
make use of all the data inside it. The
benefits to integrating your CRM and
marketing automation platform are
primarily three-fold:
1. More leads (makes marketing
happy): A marketing automation
platform will help you drive more
leads for sales. Period. A well
integrated CRM/MAP pair will
make the transition of the leads
from marketing to sales seamless.
Natively integrated MAP’s will also
arm a sales representative with a
view of all the activity a lead has
taken to get to sales. ie: engaging
with email campaigns, filling out
forms or simply going to your
website.  The sales rep can even see
what website pages were visited
and how often, before they speak to
October 2014
the prospect. Your sales rep will be
laser focused on the prospect’s key
interest areas. The benefit of this is
you spend your marketing dollars
more effectively to produce more
leads.
2. Better leads (makes sales reps
happy): Marketing automation
platforms offer lead scoring. This
function allows marketers to work
hand-in-hand with sales to define
what is truly sales ready. Sales
representatives are able to provide
feedback on content, web pages
or email campaigns that a good
prospect usually engages with.
Marketing is then able to build a
lead scoring profile to only pass
leads that meet the defined criteria
of prospect activity to sales while
continuing to nurture leads that
haven’t met that threshold. The
benefit of this is your sales reps
spend quality time with better
prospects and that boosts your
closing/win rates.
3. ROI on marketing spend (makes
management happy): Marketers
spend a lot of time filling the top of
the sales funnel with leads, but what
happens to the leads that aren’t
ready to buy? A well integrated
marketing automation platform
allows a salesperson to indicate
that marketing needs to nurture
a lead more before it is ready to
be sales qualified. The two-way
communication between marketing
and sales is key to ensuring you’re
doing everything you can to
produce a qualified lead. Marketing
automation platforms also provide
lead source reporting and ROI
dashboards to understand how
much revenue is being produced
from marketing-generated leads
and which marketing activities are
the most fruitful for you. The benefit
of this is management gets better
value from their marketing spend.
Integrating your marketing
automation platform with your CRM
isn’t hard, but choosing a marketing
automation provider that will be able
to maximize the data in your CRM
the right way isn’t easy. It is crucial to
choose a provider that can accurately
leverage your CRM data to execute
customized marketing campaigns.
Here are a couple of questions that you
should be asking when considering a
// 5
marketing automation solution that
will provide the best integration:
1. Does your solution provide native
integration? (Native integration
ensures your data is surfaced inside
the user interface of your CRM
rather than a separate interface
which will require new training and
adoption for salespeople.)
2. What is your sync time between
systems? (As close to real-time is
ideal to ensure behavioral based
nurture campaigns are timely and
most importantly, sales can quickly
act on leads.)
3. Can custom fields in the CRM
be mapped in the marketing
automation platform? (Your CRM
likely has some custom fields in it.
Making sure that you can map that
information to your marketing
automation is crucial for being able
to create customized campaigns.)
4. Is your solution an out-of-the-box
solution or do I need middleware to
integrate? (Middleware is a third
party enabler that sits between the
two systems. Middleware creates
a variable for misalignment in
syncing and can be quickly out of
date when there are changes made
to either system without updating
the middleware)
There is more to sales and marketing
alignment than platform integration,
but well integrated platforms make
sales processes and marketing
processes work in unison. Sales is
able to work in a system they’re used
to but they’re armed with a higher
volume of leads, better quality leads
and more information about each lead
to make the follow up conversations
more productive and thereby win more
customers.
Jonathan Schloo is CEO of QualityIntegrity.
com and is an expert on CRM and marketing
automation, how to do CRM right, and how to
get maximum value from your Microsoft CRM,
SalesLogix, or Salesforce system. Leading
a team of CRM experts for over 20 years to
help you leverage technology to achieve
your business goals. Phone 800-611-4343
ext.6406 jschloo@qualityintegrity.com
*A special thanks to Salesfusion, a leading
marketing automation provider, for assisting
with writing this piece.
DMN.ca ❰
Executive Roundtable
Quality not quantity
DM reader roundtable concludes “good data trumps Big Data”
By Amy Bostock
Introduction
What’s sometimes lost in today’s
romance with Big Data is that
analytics isn’t much help without
quality data. One notion that emerged
in the recent public—and political—
debate about making the long-form
census voluntary was the widely held
belief that we don’t need to worry
about government statistics because
we have so much data available from
other sources—such as tweets, likes
and online surveys. But if direct
marketers want to develop accurate
insights about consumers and deploy
effective target marketing to the
right people, they need accurate,
authoritative data. Big Data can only
be leveraged for quality analytics
when these databases are weighted,
benchmarked and analysed using
a known, accurate, comprehensive
universe—whether that is derived
from a Census, other official statistical
databases or reliable research from
firms using best practices.
Our executive roundtable,
sponsored by Environics Analytics,
takes a closer look at the data
used by marketers and discusses
why authoritative data, including
official government statistics, are so
important. They examine how data can
be used to run more innovative and
targeted campaigns and how critical
they are in the methodology, quality
and measurement of effective direct
marketing initiatives.
I have all this data…now what?!
A common theme with businesses
today is that they have a lot of data.
Along with the many benefits of
this increase in information come a
number of challenges as well.
❱ DMN.ca
“Big Data is more data, but not
necessarily good data,” says Vicky
Sipidias, the senior manager in charge
of customer experience at Hydro
One Networks, “and that’s one of
the challenges that we face - sifting
through the data, making sense out
of it and finding those nuggets of
information that can be used to form
actionable insights. It is important
to remember that in the business
world, smart decisions are based on
facts and good information. With
the introduction of Big Data, the fact
finding process gets tricky – its takes
more time, effort and resources.
In the end, she says, the payoff will
be worth the effort.
“I think technology will continue to
develop over time and new solutions
will be developed. But, I think those
that can effectively harness the new
tools, tie it to good information derived
from reliable sources (such as census
data) and marry those pieces nicely
together, are the ones that are going to
win in the end. The key is to mine the
data to form actionable insights and
use the new information to feed the
corporate decision-making model.”
But according to Paul Tyndall, a
director in the Client Knowledge &
Insights for RBC the technology and
the tools are the easy part.
“You can build the best mousetrap
in the world, you can build something
that is going to provide some kind
of insight that nobody has ever seen
before and it’s going to be whiz-bang
great, but without the ability to drive
change within the organization,
it won’t add value. And, this is
something that really needs to be
accommodated as you become more
analytically-centric, more predictive
and more prescriptive in what you’re
doing as an organization internally.”
And that push, he says, has to come
from the top.
“It’s one thing to build a
groundswell but without executive
sponsorship, the shared agenda
and the shared vision of what you’re
looking for and what you’re looking to
achieve, it becomes very problematic.
But, it is a very significant issue that,
if you don’t have that buy-in, all your
efforts are for naught.”
“I agree,” says James Thackray
of Bell Canada, “and if you’ve got
the leadership who believes in data
analysis as a key to making business
more efficient, that’s half the battle.
Then you can drive the different
groups to embrace it and embrace the
nuggets you get out of the data.”
Technology, adds Thackray, can be
both a help and a hindrance when it
comes to Big Data.
“Technology is changing so fast that
you may invest in something today
that you have to throw away in a year
and a half. It’s early days, and there’s a
lot of new technology coming from the
internet-based companies that regular
businesses can now adopt, but they’re
really evolving quickly, so that is a bit
of a struggle.”
There’s a huge benefit to be had
with internal use of data to improve
your interactions with customers. In
the past, most companies had a good
handle on information from billing
data which could tell them what kind
of use customers were making of your
product. But things became less clear
when it came to why they are using
it? Or why they are having problems
using it?
“And, that’s where we’re going to
see the biggest benefit from getting
in to these tools,” says Thackray, “to
// 6
understand the reason someone is not
using your product or having problems
with your product and getting that
information really quickly.”
Managing customer expectations
“Our clients, our consumers, are
interacting with us in more ways than
they used to and, depending on how
we’re trying to interact with the client,
these interactions can occur over a
long period of time,” says Tyndall.
“There can be multiple touch points,
it’s not just walk in, buy a can of peas
and you’re out the door. It is a series of
interactions and there are a series of
channels that we are offering to our
clients to interact with us.
“I think clients have blurred the
lines between industries, and they
expect that what’s possible in one
industry would just naturally be
possible in all industries. So, I think
their expectations are higher in that,
no matter how they’re choosing to
interact with you about whatever thing
they’re interacting with you about,
they just expect that any touch point
has full access to that information to
carry on the discussion, or carry on the
process, that was already in play.”
This, he says, puts pressure on the
organization to ensure that they
are sharing enough information to
support those interactions, but not so
much that they are overwhelming the
different interaction touch points with
too much information.
“So it’s a bit of a balancing act,” he
says “between giving them enough
information to interact intelligently
with clients and consumers, but not
so much that they don’t know where
to even begin. I think we’re getting
to that point where people have been
erring on the side of giving too much,
October 2014
Executive Roundtable
because they want to provide access to “I am often asked, why we can’t
everything that’s available, but then do similar work or offer similar
that puts too much pressure on the services in Canada as that of the U.S.
end point.” says Warren. “Clients talk to their
According to Tim Warren, a counterparts around the world and
Senior Account Executive with IHS make assumptions that we have
Automotive (formerly Polk Canada), the same information in Canada as
the upside is we have a lot of data elsewhere which unfortunately is not
but that’s also the downside in always the case.”
that it’s easy to get lost in the sea of
information available today. Restrictions to access
“Customers, often don’t know “I’ll come at it from a different
how to use the vast amount of data perspective,” says Wayne Smith,
available to them and they get Chief Statistician of Canada. “For
confused and overwhelmed. For data me, Big Data, and that would include
to be useful it must be understood administrative data, like income tax
and relevant. It’s our job to help records, represent an opportunity for
navigate through the data and help Statistics Canada to be able to respond
our customers understand what to questions that we otherwise
is available and what they need, wouldn’t be able to respond to, to
otherwise data will sit there, not be provide data at low levels of geography,
used and be of no value to them. or for very small populations, that
Another challenge, says Warren, is otherwise would not be possible. It
that organizations are cutting back also has the potential to reduce the
and often don’t have resources able cost of our programs, so that we can
to work with information effectively. do more with the available resources,
So it becomes ever more important to because it’s cheaper to re-task existing
include services and consulting when data than to go out and collect it with a
offering data. survey. Additionally, it can relieve the
Many marketers also assume that burden on businesses and households,
information in different industries so they don’t have to answer questions
exists in all markets and often look to if the data are already available from
the U.S. because of the close proximity. some other source.
“We have rather exceptional
powers to bring data
Jan Kestle is the President of together and link them,
Environics Analytics. making the data even more
“I like to say that we help people solve useful. The problem is
business problems with mathematics and that there’s a problem of
statistics. We’ve built a comprehensive set access. We are looking, for
of data and processes about the Canadian
example, at smart meter
market, from both a consumer and a
citizen’s point of view, and we help our data to measure energy
customers along the strategic roadmap of consumption. We’re also
understanding who their customers are. very interested in the
That involves identifying good data sources potential of mobile phone
that they have, combining those data with data, credit card data,
our data, and providing them actionable and debit card data to
insight into who their customers are.” achieve better estimates
of international travel in
Canada - there are all kinds
of possibilities. One of the issues
is obtaining access, particularly
from businesses. In principle,
under the Statistics Act, we already
have this authority, but it’s often
not that simple, as you can easily
imagine, particularly in the privacy
environment we’re working in. Our
biggest concern is making sure that
people understand what the data is
capable of, of what it represents, and
that it isn’t re-tasked inappropriately
to attempt to answer questions it
isn’t meant to answer. Generally
speaking though, we see big data as an
opportunity.”
October 2014
It comes down to Bob Humphreys runs all of the demand
quality generation and digital work for IBM in Canada.
“It’s my team’s scope to apply data, to
We are in this era
apply insight in a way that we’re looking to
where all the talk is
truly transform how we go to market, really
about Big Data and leveraging and moving much more to a data-
analytics. The New driven approach, more so than ever before.”
York Times has said
the data scientist is the
sexiest job of the 21st Century.
“It’s on everybody’s mind,” says
Jan Kestle, President of Environics
Analytics, “and I think getting support
from the C-suite helps focus the
requirement for data-driven decisions,
evidence-driven decision making. But
it also means that everybody thinks
they’re an expert with their own
opinions about which kinds of data are
useful for which kinds of projects.”
The result, she says, is an increased
focus on the importance of ensuring
that quality is primary.
“I’ve been involved, over my career,
in a lot of consumer marketing
studies which compare the impact of
a good modelling technique or good
software to the effect of good versus
bad data,” she says. “It’s the quality of
data that makes a difference around
business decision making. When we
think about Big Data, there is huge
opportunity, and it’s good to hear
Statistics Canada talk about how
administrative data, and data that’s
collected through the new Big Data
methods, can be helpful. But, it’s
also important that these data be
applicable and of the highest quality
for a specified purpose.
“To turn to the elephant in the
room, when there’s all this data
available and everyone has the
opportunity to do great things with
it, it’s also really important to have
good quality, official statistics that
help you understand what the biases
are in those data, so you can develop
the appropriate weights and bring the
best practices when using them. Along
with census data and administrative
data that the government can produce
comes some kind of definition of truth.
Now, it may not be 100 percent, but
it’s probably a lot better to have good,
official statistics about key business
and consumer indicators than to just
scrape the web or look at Facebook. But
in the new environment that Statistics
Canada faces around the census and
other kinds of government constraint,
how can we ensure that the Big Data
are being benchmarked, weighted and
used appropriately in the context for
which businesses want to use them? I
think that’s the biggest challenge.”
“I find most organizations are very
// 7
interested in making data-driven
decisions, but I think that there are
a lot of people who don’t necessarily
have enough of a background to
ask the types of questions around
what data is being used to support
that,” says Tyndall. “So, I feel that, in
some cases, you can be led to make
the wrong decision because you’re
presented with information that’s
based on the wrong data, or applied the
wrong technique. I think that Big Data
creates even more of an opportunity
to make bad decisions that you think
are based on data. But, if it’s not the
right data in the first place, if you’re
basing it on sentiment analysis of
Tweets versus something a little bit
more robust and stable, you’re going to
potentially make the wrong decision
for your business, even though you’ve
got charts and graphs and statistics
that say something was better than
something else. And, so I feel that this
era where everyone is a statistician,
everyone has access to Big Data, just
leaves more opportunities for people
to make poor decisions, which they
feel are accurate because they’re based
on some type of data.”
In her role as senior manager in
charge of customer experience at
Hydro One Networks, Vicky Sipidias
and her team is always conscious of
basing their decisions on facts.
“That sample file is so important, by
this I mean getting the right list and
the right representative sample. With
unstructured data, there’s a higher
risk of sample bias and sample error.
Interpreting unstructured data it is a
DMN.ca ❰
Executive Roundtable
Vicky Sipidias is the senior manager in an echo chamber
charge of customer experience at Hydro One which reinforces
Networks. Her role is to develop a new core
views that may be
competency about understanding customers.
completely wrong.”
“As you can image, we are and always
have been an asset-centric organization. So, Bob Humphreys
to become a customer-centric organization runs all of the
will take time and it will involve a shift in demand generation
organizational culture. This is important to and digital work
Hydro One, because our industry is changing for IBM in Canada
and with each new day, we face new and feels that the
competitive challenges. Now more than ever, lack of proper skills
we are reminded of just how important it is to
is a big issue as
satisfy customers and build relationships.”
marketing evolves as
a discipline.
“If you take a look at
the skills that are going to be needed
now, of the critical thinking, the
ability to begin to build some kind
of justification, validity, critical
thinking into the approach that’s
going to be taken around structured
and unstructured, marrying those
things together, I think it’s going to
be a huge issue,” he says. “For most
organizations today, that level of skill,
that level of perspective, isn’t there.
“Most analytics today is usually
descriptive, maybe some degree of
predictive. But, where we see this going
is ultimately going to be prescriptive.
So, we start getting into the whole
cognitive computing side of things and
difficult thing. It may quantify things really beginning to use it to determine
quite easily but it doesn’t qualify probabilistic outcomes as opposed
things. So, asking the right questions, to deterministic outcomes, and help
and understanding the underlying invent, help define, what’s the art of
reasons “why?” is where insight comes the possible? That’s where we think it’s
from. And these insights serve as the going to go, and it’s going to take time.
fuel for good business decisions.” And, you think now about what that
impact has on skills, what it takes now
Statistics in the age of digital on how companies react to this fluidity
marketing of incoming insight all of the time,
So how do you convince marketers, it’s going to be a very big shift to how
especially the young marketers that marketers market.”
grew up in this digital world, about Thackray agrees. “I think the low-
the importance of official government hanging fruit is that next-best-action
statistics and other old-school data? event analysis, and you don’t need the
“It’s more about them learning whole population. You can find there
to be critical thinkers,” says Smith. are customers that need the action
“There’s no telling, when you look right now, and if you can crack that nut
at a table of numbers, whether it’s then you really bring new efficiencies
good or bad. You have to ask the right to your company that you haven’t
questions. Where did it come from? seen before. It’s early stages, but
How was this information developed? these young people out of university
What was the source? What was are really good and they bring other
the target population? And, then be creativity too, in how they approach
able to deduce whether this answers problems. So, yeah, they don’t have
your question, or is it really basically the full experience of how do I make
irrelevant, because it isn’t the target sure this is representative. But, their
population you were interested in, or different way of thinking, from
perhaps it was a self-selected sample, traditional marketers, are bringing
and therefore, probably biased. And, new life into older companies, and new
they need to be critical about what ways of thinking of solving problems.”
they’re reading in social media. “We don’t want to be Luddites,”
There’s too much of a tendency to counters Kestle, “those of us who
take many things at face value. It’s are the hard-core statisticians or
❱ DMN.ca
// 8
modellers. I think it’s important to universities teaching people critical
acknowledge what you’re saying, thinking.”
but it’s really a balancing act. I think
there were a lot of digital analytics Pumping up DM campaigns with
coming out, and listening analytics, official statistics
that were being done in the early days “We rely on official statistics and
that weren’t as good as what’s evolved. census data and blend that along
So, I think it’s important that we ask with our proprietary information
the right questions, that we demand and information from partners,”
the critical thinking, but not throw says Sipidias. “We work with best
the baby out with the bath water the in class partners and rely on them
other way either, and really use these for demographic information,
data. But, I think that, as much as I socioeconomic information and more.
agree with you, Bob, we need to get This is information that our databases
into prescriptive. I would say that, and our CRM systems don’t have,
in Canada right now, with the vast or they’re not kept up to date. We
majority of medium to large-sized may have the right fields in our CRM
companies that I’m working with, that system, but we don’t always have the
they haven’t even done a good job in right information. It can be outdated,
the Gartner continuum where you missing or simply wrong. So, we rely on
go descriptive, diagnostic, predictive official statistics because it is complete,
and prescriptive. They still haven’t it’s the most trusted and reliable
even done a good job of the descriptive source. We look for the closest thing to
and diagnostic analysis of what ‘N equals all’. With official statistics we
their customers are and what their understand how it’s collected, and that
customers want. So, I think we need people are open to offering the truth
to be sure that we’re building best through the confidential collection
practices all along that continuum.” process. This is radically different from
So, does the onus fall on industry the process by which information
veterans like our panellists to is collected through the internet or
make sure that this new generation through other Big Data sources. By
of marketers understands the blending primary data with secondary
importance of not only the new data from reliable sources, we are able
channels for getting their data, but to better understand how to reach the
also traditional channels, like the hearts and minds of our customers in
government statistics? ways that we’ve never been able to do
“The onus falls on those of us who so before.”
are working with
data, but it also
falls on the Wayne Smith is the Chief Statistician of Canada.
universities, As such, he’s the Deputy Minister responsible for
Statistics Canada and all of its operations.
it falls on the
“My interest in Big Data is primarily as a source
marketing
of data for Statistics Canada. We already use it, and
associations,” we’ll probably be using more of it. However, when we
says Kestle. see big data masquerading as official statistics, we
“The Canadian get quite concerned about the way people are trying
Marketing to use it.”
Association does
do a lot in terms of
offering courses. But businesses aren’t
investing as much as they should in
ensuring that their staff is trained
properly. I’ve been encouraged by
what’s happening at the university
level. I’ve been contacted by Queen’s,
McMaster and Rotman in the last two
months, asking if we’d come in and
help develop their coursework. Would
we come in and provide data that
they can use? With everything that’s
happening out there involving data
and analytics, the business schools
are starting to try and do more. But
the responsibility of acquiring good
data and making sure it’s used in an
appropriate way requires more than
October 2014
Executive Roundtable // 9
“It’s a foundation for how we demographics and segmentation around some kind of James Thackray of Bell Canada is
estimate the size of the our market, for us to integrate into a kind of outcome, some kind of focused on business intelligence in the
behaviour. traditional marketing analytics areas
how we begin to predict where the ecosystem for marketers and analysts
including the campaign management side.
market is likely to go in the next, to use. They enable the use of a lot of That definition, says
“There is a lot of focus on big data in
say 12-month period, even 6-month other data, so survey data that comes Humphreys, is becoming our company. We’re swimming in data
period,” says Humphreys. “We use that from the Statistics Canada, like the outdated. and we’re getting our hands around how
in addition to many other different Survey of Household Spending or “The campaigns to leverage big data with the right tools
sources that help us to formulate the Survey of Consumer Finances, now are evolving to with some of our traditional IT partners.
the model and to predict what our or survey data from IPSOS in the engagement-based, that And this data is for more than just
market opportunity looks like. That Canadian Financial Monitor, enable looks at a much stronger traditional marketing, it’s really helping
then becomes the foundation for how the development of financial tools inbound environment, a on internal operations and customer
much stronger inbound experience issues.”
we assess share, how we assess our and other uses by consumers. We can
only create behavioural set of dialogues that need
data, media preferences to take place to have the kind
Tim Warren is a Senior Account Executive and psychographics— of outcome that you want to have,
with IHS Automotive (formerly Polk Canada), based, in part, on in addition to the proactive touches
which supplies critical information and services
survey data from the that go in here. Now, you’re looking at
throughout the automotive industry.
Environics Research, models that look at the propensity to
“Aside from data, we provide consulting
and analytics into the industry. We work Print Measurement respond in the way that you hope. You
closely across an organization to help our Bureau, Numeris look at models that are not just looking
customers make good decisions. Whether it’s (formerly BBM), at the next investments that you want
understanding the market, finding the next NADbank, Asking to make and the likelihood of being
best location, future trends or targeting, we Canadians and other successful on them, but now tying all
have information and services that can help.” sources—if we have these things together of individual
good, official statistics data, the interactions that they’ve had,
and sound methodologies.” the unstructured elements. You look
at, now, the other transaction pieces
The changing definition of the internal data that we’ve got to
of ‘campaign’ work with, and then underlying that
Campaigns, in the traditional sense, is still the foundational stats, that
are a proactive touch, or series of we have from Stats Canada and other cent or 10 per cent growth year over
touches, with hopeful expectations trusted sources, to help determine year, everyone may see it as a great
what do we want to do? success” says Tyndall. “But, if you look
What’s the action at the baseline data, and see, well, that
Paul Tyndall of RBC is a director in the
Client Knowledge & Insights group. that we want to take area actually grew by 20 per cent in
“Essentially, my role is to help the business place within that population, then you’ve actually fallen
leverage our internal and external assets as given area, within behind the market, and you would
they relate to data. Our internal customer that given market, have a very different interpretation
databases, external sources of data, strategic within that given about where the opportunity lies. If
marketing research data, profitability models, segment, within you’re only looking at the numerator
predictive models, anything like that that can help that individual that and not the denominator, you can
understand how our clients are behaving, how we want to deal be greatly misrepresenting how
prospects convert into clients, how they acquire,
with? So, I don’t successful you’re being.”
use and grow with our products and services, and
where there are gaps and opportunities.” think that the term
campaign is as Why marketing loves (or should
performance vis-à-vis the market. large or as robust as love) official statistics
On top of that, it’s also a foundational what it needs to be in many cases.” For Tim Warren, good, official
element in our predictive models that “It’s a very basic part of the simple, statistics help to create current-
we use within the marketing activity old stuff that you do around assessing year estimates, or other data sets
that we have. So, if we’re trying to lay market share, determining where like cluster systems that are very
an investment down and determine you are doing well and not doing well important marketing tools and is
whether or not that investment is a with certain types of customers?” surprised with how many people don’t
good bet or a bad bet, it’s an input into says Kestle. “You can see what your realize the role Census data plays in
building those kinds of models. It’s customer base is doing with certain their development.
an input to help us make sure that the services and products in different “I love working with data and the
model is robust enough that it captures areas, and you need that other base stories it can tell. Unfortunately
the geographic elements of where is to say, well, what am I missing? It’s a the story isn’t as good or complete
our market, where is the spend, where very basic part of the whole analysis, of when data is missing. The challenge
is the opportunity?” understanding where you’re doing well is helping people understand the
“We’re in a different position than and not well so you can determine why importance of something like
everyone else,” says Kestle. “We’re a and how to change your approach.” completing the Census and the
data provider and we use census data “I’d say without a broader set of impact of not doing so. When the
to create current-year demographics baseline information that you miss average person is asked if they know
and segmentation systems. But the opportunities, because if you look at how Census data is used they often
other use of those official statistics your own internal data and you see, go blank. They are unaware the
is building that foundation from the in a certain area, that we’ve had 5 per information is used to help shape

October 2014 DMN.ca ❰

Executive Roundtable
future development, social policies,
planning and much more. We need to
improve awareness of the importance
of participating in the Census and the
implications of not doing so.
For a company like Hydro One, it’s
the wealth of information that comes
through products like Environics
Analytics’ Prizm codes that blends
the StatsCan information with all of
the other communication information
and all the wealth of databases that
you put together, that allow them to
understand the social values of their
customers.
“The problem that we have is that
everyone and everything seems to
focus on urban centres, and in our
case, we are a utility made up of 300
or more rural, suburban and small
communities. This is where the
information becomes “grey”. Finding
reliable, trusted information, and
getting as much as we can from good,
reliable sources, is key to us.”
According to Tyndall, people need
to have full awareness about where the
data came from, how it was gathered,
how large the samples were, biases, so
that they can use all of it, but use it in
the proper context.
“I’ve been in discussions where you
use external data like census data
and it will say the best responders
are people with an average income of
$75,000, for example. People will jump
to the conclusion that, well, our best
customers have an income of $75,000.
But no, they live in an area where the
❱ DMN.ca
average income is $75,000. That’s not
their income, that’s the average in the
area where they live. And, so just use
it knowing what it means, and don’t
extrapolate or jump to conclusions
beyond how it was gathered or what it
was meant for. Take it with a grain of
salt, because once you take it to that
level and help people understand, it’s
can still be great data that fills in some
gaps. But, it is not the same as your
own data, where you know the balance
on every account, for every client on a
daily basis.”
“I think your point illustrates the
fact that you couldn’t use the very
reliable 12,000 responses from the
Canadian Financial Monitor to look
at a branch trade area if you didn’t
have the official census data to use as a
modelling tool, to say people typically
behave according to their type,” says
Kestle. “And that’s true. If I know the
type at the neighbourhood level, then
I can take those 12,000 responses and
use some statistically-reliable method
to project it to the ground. It’s not the
same as taking the 12,000 and trying
to spread them across DAs. You have
to have robust statistical techniques
to do that. The official statistics really
help us do that, in a way that you can
get a better projection for small areas
than you can from a sample survey.”
But, our panellists agree, you still
need to understand that data that has
been modelled or linked in that manner
is not the same as data that you have
gathered at an individual level.
“In Canada, we’re really preoccupied
with explaining how the data are
modelled,” observes Kestle. “What
surprises me is that, if you go to buy a
piece of data in the U.S. and ask, ‘Was
this modelled data or actual, individual
data?’ the person on the other end
of the phone doesn’t know the
answer. They don’t even understand
the concept. So you can buy all this
household data that’s perceived to be
reality when, in fact, most data are
modelled from best practices.”
“That really screams that the ability
to tell the story of what the insight
is suggesting to you really needs to
be crisp, which incorporates all that
nuance around the interpretation
of the finding, or findings,” says
Humphreys, “and, in my patch, all I
can say is they wouldn’t give a flying
fazoo around the nuances of here are
the different data sources, here are
the different sensitivity surrounding
all the various different data sources.
They want to know what’s the
implication, what’s the suggested
action, primarily, and leave it upon the
team that put it together, and trust the
team that put it together, such that it’s
going to be good enough to actually
act on. But, now that puts pressure on
the criticality of thinking, the skills,
the ability to interpret, the ability to
bring the organization along, and that
has a huge cultural impact on the kind
of people that we need to have to help
make that kind of thing come to life.”
// 10
Drowning in data
With all of this data available, how, as
marketers, do you decide what you’re
going to use for what purpose within
your organization?
“That’s a really tough one,” admits
Thackray, “and, if you’ve got the time,
it becomes an easy problem. If you
have the time to wade through all the
data and find the right attributes that
are prescriptive of the outcome you’re
looking for, it’s pretty straightforward.
The problem is, you don’t always have
the time. You’ve got a deadline for a
particular campaign or whatever, you
don’t have the time to really get the
right attributes in the right form to get
to 100 per cent best you possibly could
do. That might not be a bad thing. In a
lot of cases, for us, you don’t need the
100 per cent best answer. You need
a better answer than if you weren’t
using the data. So, it’s a balancing act.
When you have the time, you can do a
really good job. If it’s more important,
you spend the time on that particular
model to make it as perfect as you can.
If it’s an action which is only really
going to affect 10,000 customers, well,
okay, so what? Let’s go a little easier
on the analysis and get to a solution
quicker.”
“We start with the end in mind.
By this I mean, we start with the
question that we’re asking of the
data, i.e. “what is it that we want to
know?” says Sipidias, “and, then we
Continued on page 26
October 2014
bronto.com/DMCA
Cover Story // 12

Should you
catch the
big data
wave?
Why free data
isn’t always
good data

❱ DMN.ca October 2014

Cover Story
By Bill Peterson
I
see a flood coming…and it’s big. is whether these agencies are using
Big data, that is. Industry sources the data to make important policy
report nearly 90 percent of all data decisions.
in the world was created during the Why is this a problem? Free data,
past few years alone. It’s estimated even lots of it, doesn’t necessarily
by IBM that more than 2.5 billion mean that it is the right data, and
gigabytes (GB) was generated in 2012 that the conclusions drawn from
–every day! it, whether it is with respect to
Over the past year there have been unemployment numbers or flu trends,
several stories about government can often be way off the mark. From a
agencies in Canada collecting publicly marketing perspective, looking to free
available, free data. Earlier this year data to help guide strategic decisions
it was reported by the federal privacy could be a very costly mistake.
watchdog that our federal government To understand big data, it’s
has been collecting Canadians social important to look at the size of the
media data, for example. While there digital universe. In its recent report,
are obviously concerns around privacy analyst firm IDC notes all the data
that need to be addressed, another that consumers and businesses
pressing concern create and copy annually will hit 44
trillion gigabytes by 2020. In fact, this
number is doubling in size every two
years. This universe consists largely of
unstructured data built by the power of
the Internet - including email, Google
searches, tweeting and social media.
According to a recent article
in Forbes, data has become one of
the most critical company resources:
“Once you start tackling big data,
you’ll learn what you don’t know,
and you’ll be inspired to take steps to
resolve any problems. Best of all, you
can use the insights you gather at each
step along the way to start improving
customer engagement strategies.”
Recently, the New York Times
investigated some of the drawbacks
associated with big data. The piece
notes that – while beneficial – big data
is not the panacea to all that ails society:
“although big data is very good at
detecting correlations, especially subtle
correlations that an analysis of smaller
data sets might miss, it never tells us
which correlations are meaningful. A big
data analysis might reveal, for instance,
that from 2006 to 2011 the United
States murder rate was well correlated
with the market share of Internet
Explorer: Both went down sharply.”
Courtesy CenturyLink Technology Solutions
Still, big data is rapidly being
adopted by the marketing sector as a
means to find new micromarkets and
discover new customer insights. Given
the abundance of data from which to
choose, tapping into this insight seems
like a natural fit.
Some companies are certainly
benefitting from big data. According
to a recent McKinsey report, “those
that use big data and analytics
effectively show productivity rates
October 2014
and profitability that are 5 – 6 percent
higher than those of their peers.”
Their analysis of more than 250
engagements over five years “revealed
that companies that put data at the
centre of the marketing and sales
decisions improve their marketing
return on investment (MROI) by
15 – 20 percent. That adds up to $150 –
$200 billion of additional value based
on global annual marketing spend of
an estimated $1 trillion.”
While big data brings big
opportunity, it also brings a lot of
risk. The McKinsey report also found
that “many marketing executives find
themselves faced with overwhelming
amounts of data and organizational
complexity, rapidly changing customer
behaviors, and increased competitive
pressures.” This coupled with the
potential inaccuracy of that data
exposes marketing to many potential
pitfalls.
UK research firm Dynamic
Markets recently conducted a study
that revealed bad data is also costing
companies. In fact, three quarters
of UK organisations are currently
losing potential revenue due to poor
contact data, and 94 per cent believe
they have poor data quality in their
organisations.
So, is all big data “Bad Data”?
Not necessarily. To ensure quality,
accurate data, what’s necessary is
a dedicated plan and methodology
– backed by targeted solutions and
managed services. But why managed
services? The information universe
is exploding. Due to IT budget cuts
and other constraints, most in-house
IT departments don’t have the
resources to do the job right. Lack of
infrastructure space – and the inability
to purchase more equipment – often
leads to inefficient storage and
management of critical information.
What I have seen, from a personnel
side, is that many IT directors lack the
bandwidth to manage and ensure data
integrity. This leads to information
overload and poor decision-making.
That’s where managed services come in.
A good managed service provider
will offer the technology foundation
capable of optimizing storage,
streamlining integration and
driving quick retrieval and analysis
of structured, semi-structured
and unstructured data. This leads
to cleaner, better managed data. A
// 13
dedicated managed service provider
can also provide elastic bandwidth
to expand connectivity and handle
increased usage – while enabling
the environment to scale down as
necessary.
Almost as crucial is a provider
that ensures critical information
is always available and reliable. The
goal is a “Tier 1,” IP global network
with multiple layers of redundancy to
guarantee extremely small windows
of downtime. In layman’s terms: an
Internet backup plan. This must be
accompanied by a powerful security
ecosystem that not only protects
sensitive data, but also ensures
strict compliance with industry and
government mandates. Lacking a
powerful global network and full
connectivity at the core, a big data
project is doomed from the start.
The ultimate goal is to find a
partner, like CenturyLink Technology
Solutions, that is able to offer these
critical elements, while customizing
services to match each unique
business or marketing environment.
A strong partner will also deliver
tailored managed services – ranging
from business case development and
big data environment planning to
training and implementation services.
Big data is changing the way
marketing conducts business.
Encouraged by vast amounts of
information spread across the digital
universe, many departments are
undertaking significant investments
to better harness the power of both
structured and unstructured data.
But to meet these ambitious goals,
adopters must stand clear of the data
free for all – ensuring they leverage
only the most relevant data sets to
drive quality decisions. Be sure to align
with a partner capable of developing
a big data offering that reliably and
safely stores, manages and analyzes
every piece of critical information.
Otherwise, you run the risk of
literally drowning in a flood of data.
William “Bill” Peterson runs marketing and
strategy for CenturyLink Technology Solutions’
Big Data efforts. Prior to CenturyLink, Bill ran
Product and Solutions Marketing for NetApp’s
Big Analytics and Hadoop Solutions. In
addition to his marketing role at NetApp, Bill
was the Marketing Co-Chair for the Analytics
and Big Data Committee, SNIA.
DMN.ca ❰
Targeting & Acquisition
Social media & Big Data
Using social marketing to attract high net-worth clients
By Yvon Audette
D
espite the rising popularity of
social media in personal and
business communications,
Canadian banks, while active in
some areas of social media, are not
leveraging it to the same degree or
effect as many consumer and retail
companies. There’s a particular gap
when it comes to generating sales
opportunities with high net-worth
clients. This can be partially explained
❱ DMN.ca
by the regulatory climate. Banks
hesitate to mount social media
campaigns in the wealth and asset
management space because of
potential regulatory ramifications.
However, while there are almost
certainly restrictions to take into
account, high net-worth clients
represent a significant market that is
not currently being tapped. It’s time to
start looking beyond the barriers to see
how banks can access these investors
through social media and what they
should bring to the conversation.
This is where big data enters the
picture. We know that banks, like
most businesses running on a digital
infrastructure, accumulate and house
masses of data. There is already a
general recognition that businesses
need to find better ways to leverage
this information to drive business. For
// 14
banks, big data may provide an “in”
with high net-worth investors
if they start asking themselves the
right questions:
❯❯ What can we learn from our
data to help us formulate social
approaches?
❯❯ What specifically should we
talk about?
❯❯ What products should we
promote online?
October 2014
Targeting & Acquisition // 15

Social trends in the clients following an inheritance

scenario provides an interesting
media has expanded at an extremely
rapid pace, analytical software and

wealth management
example. Just two percent of children technologies specifically relevant
keep their inheritances with their to the financial services industry
parents’ financial advisor. Rather than are struggling to keep up. At the

industry worry about losing clients, however,

financial advisors should view this
as an opportunity. Consider using
same time, banks still face a titanic
information management task with
respect to internal information silos
❯❯ Financial advisors’ (FA) personal homepages are often the social media platforms these and data management.6 So whether
used to stimulate social networking. younger generations are comfortable you collect external data from social
❯❯ FAs at major wealth management firms use LinkedIn for working and communicating in media, or try to cut your internal
to build fresh relationships and data to apply it to social media, it’s a
prospecting and finding professional groups that fit the FA’s
target market (e.g., doctors).
❯❯ FA Twitter pages are also becoming more common, though

❯❯
compliance remains a challenge.
Many retail brokerages and asset management firms now
❯❯
have corporate Facebook and Twitter profiles.
Most major self-directed brokerages offer their own
communities to clients—no sign of similar efforts among
wealth management firms.
❯❯ Are there opportunities to leverage
technologies like crowd sourcing
and crowd funding?
❯❯ How do we incorporate data
consistently into our strategic
approach?
❯❯ How can we use technology to make
the most efficient use of data?
The fact is, banks currently use
social media more as a branding tool
than a targeting tool and have not
embraced the idea of combining data
with social media to target high net-
worth investors. Canadian financial
institutions that do so, however,
may be opening a market rich with
opportunity.
Not only do a larger
proportion of social
media users manage
their investments, they
are significantly more
likely to conduct finance
research. Over nine in ten
high net-worth investors
using social media
conduct financially-related
research compared to
only 70% of non-social
media users.
Situation and opportunity
A recent study on the growing
influence of social media on high net-
worth investors identified multiple
channels that financial institutions
could use to develop key relationships,
target specific promotions and
products, and get clients to explore
what further products are available.
For this cohort, high service levels
and improving on the customer
commitment are extremely important.
People leading very busy business
lives are attracted to services that
save time and yield better quality
results. LinkedIn, for example, likely
due to its focus on business-related
information and relationships, is
very popular with the high net-worth
community—significantly more
popular for the ultra affluent than
other channels—suggesting it as
a logical focal point for targeting
campaigns.
Banks, of course, tend to focus
on high net-worth investors, but
that doesn’t mean social media can’t
also be used to target and attract
other communities, for example
lower net-worth consumers and
commercial enterprises (which could
include owner/operators or even
board members). It’s really about
finding non-traditional channels to
connect to potential customers in a
straightforward, efficient way.
Growing influence of social media
Once the connection is established
and the message out, however, how
do you get prospects to “come in” the
door? Urging them to “drop in to the
bank and talk to an advisor” is no
longer the most effective approach.
You have their attention—how do
you close the loop and get them to
begin engaging profitably in your
digital space? Retaining financial
Social media’s
growing influence
among high net-
worth investors
❯❯ Social media is proving to be an invaluable tool, with five
million high net-worth investors in the U.S. and Canada
actively using social media to help them with their
financial decisions.
❯❯ The ultra affluent (more than $5 million in investable
assets) are passionate about investment research.
❯❯ Regardless of whether or not they use an advisor, social
media users tend be more active with their investing.
❯❯ Two-thirds of high net-worth investors visit LinkedIn
monthly, which is consistent with Facebook and over
twice the visits to Twitter and Google+.
❯❯ LinkedIn is the most trusted social platform for financial
services companies to engage with high-net-worth
investors when they are in a professional mindset.
❯❯ Social media is about relationships and finance
companies need to engage with their customers.
retain them as clients—or to attract challenging task in a fast-changing
those newly available clients fleeing landscape.
what they perceive as old-school Nonetheless, firms across the
communications methods. financial services industry have
leveraged data analysis and social
The big data play—targeting media to varying degrees of success
in social media by having a customized strategy,
Certainly the financial industry specific goals driving multi-platform
is excited over the rich source of initiatives, and a strong understanding
customer data that social media offers. of the strengths of each platform.
By carefully harvesting, analyzing, Corporate Insight’s Social Media
and leveraging social media data, Leaders Report identifies American
banks may be able to gain valuable Express’s social strategy as
insight into customer investment “embodying the greatest number of
patterns, market trends, and value best practices as a whole” and “using
propositions, to name just a few. Yet, more social media channels more
while big data will be key to effectively effectively than any other firm.”
targeting high net-worth and other The company launched its first
communities, banks are finding it online community in 2006. A year
difficult to determine exactly what later, it launched OPEN Forum,
data is most valuable. While social its most successful proprietary

October 2014 DMN.ca ❰

Targeting & Acquisition // 16
kind of granular information is highly competitive financial services

Initial steps to improve becoming a competitive necessity.

It does remain important that
markets. Social media reaches a wide
breadth of individuals overall and high

social media targeting

any initiatives in this vein take net-worth investors in particular, but
the current, stringent regulatory it can also improve brand perceptions.
environment into account. Research suggests that 28 percent of
Banks work hard to enhance all high net-worth investors would
❯❯ Try to leverage your broader social/marketing approach to
their customer commitment, perceive a financial company as
target specific communities and clients. but balancing stricter regulatory “innovative,” “a leader in the industry,”
❯❯ Look at ways to offer products, services, and communications protections for consumers always or “on the cutting edge” if they offered
in a more digitally relevant fashion, such as chat-based access enters into the picture. Once social media tools delivered through
to social bankers versus traditional email contact. you understand the regulatory, the appropriate social platforms
❯❯ Consider incorporating less traditional services into your own legislative and privacy boundaries, (that is, business-oriented platforms
marketing structure; crowd sourcing, for example, has been you can begin to use your data rather than sites focused on personal
successfully used by some start-ups in Silicon Valley. to more effectively optimize interaction where aggressive financial
customer relations and augment marketing may seem intrusive). It
your existing marketing structure seems increasingly clear that the
community, which focuses on small insurance. with social media. advantages of social media targeting
business owners. On the flip side, LinkedIn is a can be ignored only at banks’ own risk.
Financial advisor Vanguard uses more appropriate forum for sharing Social media will continue to drive That means acting now to not only
Twitter to the fullest by engaging business-related information. opportunity develop data-based strategies, but to
consumers, providing real-time When data can be cut to reveal this With over 90 percent of high net- implement the technologies required
customer service, sharing valuable kind of client-specific information, the worth investors participating in social to put those strategies into action.
content, and even hosting live- marketing and targeting value is clear. media in some form, an integrated
tweeting events. Consider how much you can learn just social media marketing strategy is Yvon Audette is Partner, Advisory Services,
Insurance company Esurance has by understanding who people talk to necessary—not only to get results, but National Service Line Leader, IT Advisory at
a strong grasp of Facebook marketing and connect with. By analyzing this simply to remain relevant in today’s KPMG.
campaigns, having conducted a data, you can develop
variety of contests and campaigns to insights around a broad

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promote its products, services, and
philanthropic efforts.
There are some key steps involved in banking clients. Then
initiating a social targeting strategy.
If your target is high net-worth
investors, data analysis should focus
on identifying them, both from
your own data and by collecting
and analyzing social media data.
Next, it’s important to collect data
on what specific users are doing on
your own different platforms so
you can accurately tailor your client
communications. For example, most
people use Facebook for personal
updates, which might suggest sharing
information about personal products,
such as household mortgages or
range of individuals
that may be good private
consider who those
individuals connect to
and any information
social strategies
One barrier to banks developing a strong social strategy is that
available about those
while they have plenty of data on hand, they do not always have the
connections. Those
social network may help
technology to leverage that data in ways that drive business. The first
you define community step in transforming your retail approach is to think “digital first.”
behaviours and identify How can you optimize and enhance your services and operations to
usage patterns, leading leverage your wealth of legacy information? You need the technology
to improved channel in place to analyze, cut, and apply that information in ways that drive
optimization and the targeting process. This is a major paradigm shift, as “digital
increasingly targeted first” thinking can lead to some very sophisticated technological
promotional capabilities. requirements, but having the infrastructure in place to leverage big
Proactively using
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❱ DMN.ca October 2014

Kicker
Targeting & Acquisition
Improving your single
most important analytic
Why customer segmentation is important to your business strategy
By Brian Jones
S
egmentation in its simplest
form is about putting
customers into “like” groups.
It’s truly one of the most powerful
analytics. At the core of its strength is
its ability to support businesses in the
laser focussed targeting and managing
of their customers.
With the amounts of information
increasing, segmentations are about to
get smarter. Big Data is creating unique
opportunities. And advantage will go
to companies that are able to aggregate
vast amounts of information that build
predictive segmentations.
But it’s critical to get your
segmentation right because in a
customer centric world, customer
segmentation has become an integral
part of business strategy.
What’s right for your brand?
Think of airlines and their frequent
flyer programs. With a program in
place, an airline can easily identify
their “best customers” and understand
their needs. This understanding
enables them to deliver a different
experience vs. those delivered to their
“next best customer”. The strategy is
clear in this example. It’s to protect
and reward their best customers, in
order to retain them. This is a simple
segmentation to address an important
strategy, and supporting a strategy is
exactly what a segmentation should do.
Most businesses can identify their
best customers or their most profitable
ones. So segmentations don’t have
to be complex to work, they just have
to be right for your business. What’s
right for your business is dependent
on your businesses strategy. Building
a segmentation that supports your
strategy is key. By “support” I mean it
provides direction on achieving your
goals and objectives, as well as helps
to measure your progress. Therefore,
when developing your segmentation
think how you will use it and the
decisions it will help you make.
Getting started
Segmentation requires customer data,
and often starts with sources of data
simple to access. If you’re looking for
a less complex segmentation, and
October 2014
your strategy is “growing existing
customer spend”, then look to your
customer lists. If those lists identify
information such as who the customer
is, the amount spent, and on what
and when they spent it, then you are
clearly on your way with one of the
most basic, but nonetheless effective
segmentations. It’s called an RFM
segmentation. RFM stands for Recency
(when they last bought), Frequency
(how often do they buy), and Monetary
Value (what they spent). These pieces
of data can reveal considerable insights
that help manage customers in a
more relevant way. In their simplest
form they are used to know how often
to mail and when to mail, after the
“who” to mail has been determined.
Executing against an RFM will
help increase number of customer
transactions and their size.
While an RFM can be effective
and simple, it is merely one of
dozens of ways to segment. Others
range from basic demographic
segmentations through to more
complex segmentations that cluster
behaviours, attitudes, opportunity,
benefits, needs, life-stage, and
channel shopped. These are just a few.
Segmentations can also be overlaid
with other segmentations enabling you
to narrow targeting which adds more
relevancy to your marketing. Think
of the value of overlaying a Heavy/
Medium/Light buyer segmentation
with a buyer demographic. “Weighting”
the demographics through purchasing
information helps further define what
your customers look like, and provides
greater insights on where to invest your
marketing dollars and what message
to deliver.
Improving segmentation
performance through loyalty
programs
Customer loyalty programs provide
rich customer data bases, which can
be leveraged to create very effective
segmentations. Loyalty cards have a
unique identifier which is the loyalty
card number. Whenever you buy a
product and use the card, the purchase
is linked to you. Businesses store this
data in their data bases, and leverage
the power of analytics to introduce
insights into their organization.
Some retailers have become great
users of loyalty program data. For
example, drug stores can use their
customer loyalty data bases to
segment customers by life-stage.
Life-stage is an ideal segmentation
for a drug store as it enables them to
target their customers with offers that
are relevant to their stage in life.
Here’s how it works…what we buy
tells the retailers a lot about ourselves.
The first purchase of razors and
shaving cream or feminine care, or the
purchase of baby food or incontinence
products - all speaks to our life-stage
and our needs. The ability to manage
the customer based on this knowledge
helps drive customer value. For
example, baby food buyers are of
considerable value to a drug store. The
range of products they require is wide
and deep, and their frequency of shop
and transaction size is high. Therefore,
a drug store will want to engage this
customer segment and earn their
loyalty. With the customer insights
they can begin to market products
and services that specifically address
their needs, and do so at the right time.
This will help drive the customers’
experience, increase loyalty, drive
transaction size, and grow the
customers’ life time value.
Taking it to the next level
When attitudinal data is overlaid
with behavioural data, more refined
segmentations can be created. The
combination of the two can begin to
deliver a greater one-to-one marketing
experience which drives campaign
performance. Attitudinal data, like
behavioural data, is also inherent in a
shopping basket. For example, those
who purchase a disproportionate
amount of health food products can
be put into a “healthy” segment. When
combined with those purchasing
baby food, you start to get a clearer
picture of your customer. Data could
confirm that the customer is an active
female in her early 30’s whose health
conscious attitude will likely be
reflected in what she feeds her infant.
This type of information becomes a
// 17
marketers dream. Everything from
what to market to them and how often
to market to them becomes clearer.
Knowing the customers’ life-stage
ensures retailers are relevant to their
customers which drives engagement
and loyalty while ensuring their
marketing dollars are spent in the
most efficient way. Highly relevant
marketing has proven time and time
again to increase the performance
of marketing campaigns. As we all
work our way through our teens,
20’s, 30’s and so on, the products and
categories we buy provide all types
of information for retailers that
ensure the experience that we have as
customers is relevant to us.
Summary
In a customer centric organization,
the customer segmentation becomes
core to the enterprise strategy.
Therefore how you segment your
customers becomes a very strategic
decision. The key is access to great
amounts of customer data. The more
the information can be linked back to
a customer, the better. Having access
to both attitudes and behaviours
for example helps you to define
segments while providing guidance
on messaging content, offers, and
frequency. Consider the value of data
provided through customer loyalty
programs, specifically those programs
that link purchases back to an
identifiable individual.
Lastly, explore other sources of data,
perhaps those available through your
vendors, or through deep search engine
technologies. Big data creates great
opportunities in this area. The more
data you have the greater opportunity
to build highly competitive smart
segmentations that support
competitive differentiation while
delivering your goals and objectives.
Brian Jones is the Principal of Active Data
(www.active-data.ca) as well is an Associate of
Alpha Insights (www.alphainsights.ca). Brian
can be reached at brianjones@active-data.
ca. View Brian’s profile athttp://ca.linkedin.
com/in/brianjones99/, or reach him directly at
brianjones@active-data.ca
DMN.ca ❰
Engagement & Analytics
The trouble with
By Richard Boire
B
efore I continue, let me preface
this article with my underlying
bias where I consider the
definition and roles of data science
and data mining to be identical. In
the last article, the discussion focused
on the notion that the traditional
four step data mining approach and
methodology in building solutions to
business problems and issues has not
changed in the new Big Data world. As
a reminder, this four step data mining
approach is as follows:
1. Identifying the business problem
2. Creating the analytical file
3. Deploying the necessary technology
and tools to build the solution
4. Implementation and deployment
of solution
Within the Big Data world, this
above approach commences with
the problem we are trying to solve.
The building of predictive model
represents just one outcome of data
mining. Data mining and analytics can
be deployed in a multitude of scenarios
to solve business problems beyond the
building of predictive models. But let’s
first discuss the building of predictive
models. As discussed in the last
article, it is quite common to develop
excellent predictive model solutions
in the so-called “traditional database
environment”. Excellent results, as
determined by the performance lift
differential between the top decile
and bottom decile or observing
the KS statistics, are unlikely to be
significantly improved by delving into
the social media sphere of Big Data.
Why? In all models that perform
very well(8 to 1 or better between
the top decile and bottom decile), key
variables that are most important as
model predictors relate to behaviour
or what the customer has actually
done with the company. ”Behavior”
type variables represent the richest
data in building predictive tools.
Looking at what the customer has
❱ DMN.ca
Part 2
“transacted” with you or what they
have done is very powerful in terms of
what they will do in the future. Given
the “behavior” hypothesis statement
above, we often see that the most
powerful predictors in a given attrition
model are changing purchase behavior
prior to defection. Other variables
related to what, where and how they
purchase tend to be identified as key
trends in defection. It is this rich
“transaction/behavior” information
that makes practitioners question
the “value” of crossing over into
the Big Data digital divide of social
media. Beyond the all the privacy
and governance issues surrounding
this data, the practitioner will ask
“How much incremental performance
in the model will we obtain from
social media commentary along with
accompanying metadata.” Some
subjectivity by the practitioner will
determine whether the model is good
or marginal. Obviously, marginal
models would tend to delve into the
Big Data ether in order to increase
model performance presuming privacy
and data governance are non-issues.
Online models
On-line models represent pseudo-
behaviour type predictive models in
the sense that we are using solely the
customer’s web/navigation behavior
to predict that person’s next online
behavior .The most relevant on-line
models are those that predict an
outcome which represents conversion
or purchase behavior or even likely
to purchase. Log files are used to
construct variables based on the
web site last visited by the customer,
time of visit, duration of visit as
well as variables related to his page
viewing behavior while on the current
company’s web site. Despite the fact
that we are not necessarily looking
at transaction purchase behavior,
we are looking at prior web behavior
to predict a future web-behaviour.
In this sense, on-line models can
be pretty powerful in predicting
clickstream on-line behaviour or
what pages an on-line customer is
most likely to look at next. However,
conversion models or the ability to
predict likelihood to purchase can
be trickier as much of the purchase
behavior may be influenced by other
channels as well as transaction
behavior prior to the conversion
activity. Unless the company is
Amazon where conversion models
can be pretty powerful as the buying
options are confined to the Amazon
website, most companies have
alternate avenues for a customer to
make a purchase thereby adding more
noise to online models.
But as we observed in the
offline predictive models rich with
transaction-behavioural variables,
can online models be enhanced by
looking at Big Data (i.e. social media
information) information. Once
again, if the practitioner is obtaining
the typical expected performance
lift from a predictive model using
behavioural data, appending Big Data
to online log file data is unlikely to
increase performance lift. In most
cases, appending Big Data (i.e. social
media data), governance issues aside,
// 18
4-step
data
mining
approach
1. Identifying the business
problem
2. Creating the analytical file
3. Deploying the necessary
technology and tools to
build the solution
4. Implementation and
deployment of solution
will yield minimal lift in model
performance.
Behavioural advertising
and Big Data
So where is the big bang in the use of
data mining and analytics regarding
Big Data. One of the biggest benefits of
BIG data is the notion of behavioural
advertising analytics. For the first
time, we can measure the impact of
“eyeballs” on an ad. In the past, this
kind of impact was always limited in
the sense that we could never measure
“eyeballs” on billboard or magazine/
newspaper advertising and had to rely
on sample research studies for radio
October 2014
Engagement & Analytics // 19

and TV advertising. With behavioural
advertising, we can determine the
number of clicks on a particular ad on
a given website. Advertisers can then
determine the cost per impressions
(CPM). With this information,
advertisers can be selective in
determining where to place their ads
given the cost per impression (CPM) on
that given website. The analytics can
even be more granular by looking at the
cost per impression (CPM) for a specific
page. As a matter of fact, testing
strategies can be easily executed to
determine the impact of different
offers/communication options.
Companies such as Google and Yahoo
have become experts in this domain
area given their revenue model of paid
advertising. In most of these cases,
behavioural advertising is about the
use of analytics for measurement and
relying on what has happened in the
past regarding CPM and then making
decisions going forward regarding the
placement of ads. However with the
advent of Big Data technologies, it is
now possible to employ more advanced
analytics by developing tools which
predict CPM for a given website. A
good example of this is an ad for a new
product. Huge amounts of data exist
regarding CPM and the clickstream
characteristics of a given website could
be used to estimate or predict the CPM
of the ad for that new product on that
particular website.
Location Analytics
Location Analytics has become
another area of exploitation in the
Big Data era. As our society has now
become hinged to their mobile devices,
the GPS technology now embedded
in these devices can be used to
determine the location of customers.
Using this information, a given store
can tie in the product preferences
of this customer and market them
accordingly. For example, I may be
going up a particular aisle in a store
which has hockey tape. An SMS
message would then alert me to the
fact that hockey tape is in this aisle.
Furthermore, I may be driving and
a certain restaurant of which I am a
preferred customer is nearby. An SMS
message in my car would then alert
me to the proximity of the restaurant.
Now you might say, where is the data
mining or analytics? In the case of the
retailer, it is determining my product
preferences while for the restaurant,
it is determining whether or not I
am a high value or loyal customer.
In both cases, the data mining and
analytics information needs to be
integrated with the GPS technology in
order to produce the appropriate SMS
communication.
Telematics
Another area of great growth
and awareness within Big Data is
telematics. Here, technology can now
provide software in a car that monitors
the behavior of the driver. The
implications of this are enormous for
automobile insurers. As I mentioned
before, one of the key pieces of
information in building predictive
analytics solutions is behavior-based
information. With telematics, we now
have access to behavior as the software
devices capture the behaviour of the
driver. Data pertaining to the speed,
braking, etc. provides very rich driver-
behaviour information. Analytics
practitioners within insurance
salivate at the thought of being able to
potentially integrate this information
into existing tools that are used for
pricing of policies within the property
and casualty area. Besides risk, car
manufacturers can better understand
the style of drivers for specific
cars. This information can then be
obviously used to modify the design
of existing cars or in the development
of new cars which balance the needs
of satisfying the consumer while
at the same time building a safer
car. Suffice to say, this technology is
just beginning to take hold in this
country but the volume of data will
be explosive if we think of what can
be captured during the driver’s daily
behavior.
Other data sources
in the Big Data world
As Big Data explodes, sources of data
that were once considered outside the
realm of analytics from a practitioner’s
perspective are now available as
different inputs that might yield
unique insights in solving a problem.
A good example of this is the weather
data. For instance, can we attribute
different types of weather to the sale
of certain items. What about stock
market data? Does the trend in the
TSX or DOW impact certain sales
items more than other sales items. In
the past, much of consumer behavior
was determined thru market research.
Market research will certainly
continue to be a valuable science in
understanding the psychology behind
consumer purchase behavior but it
will not be required to understand
what customers actually purchase.
With Big Data, we now know what
consumers did and can tie it back to
a myriad of different information
sources. The data is there but the
challenge is integrating this data into
an analytical file in order to tell a story
and to ultimately identify decisions
and action steps that are better for the
end stakeholder.
The “explorer” mentality
in the data miner
Data, big or small, is no longer the
limiting factor in solving business
problems. For Data geeks, it is similar
to a child being in a candy factory. The
challenge for geeks, unlike children
who will simply attempt to consume
all that is available until they become
ill, is to derive sense from all the is
information. This is not to imply that
they will have the necessary answers
or solutions upfront but that they have
the required information that might
be considered in solving a particular
business problem. Data Miners are at
heart explorers. In some cases, this
may necessitate identifying what
the actual business problem is. But
the real commonality amongst the
data mining community is a thirst
for knowledge that will ultimately
resolve the business problem. This
requires an “explorer” mentality in
being able to extract and create the
right information and to then develop
a variety of different solutions. In
this kind of environment, as Tom
Davenport indicates, “the data
scientist is essentially hacking away at
the data“ but with a view to building
the best solution. This inquisitiveness
and academic curiosity amongst data
miners is not new. In fact it is this
inquisitiveness and curiosity that
will expand the discipline in new
techniques and approaches thru the
practice of using data (big and small)
to solve business problems.
Richard Boire is a partner with analytics
company Boire Filler Group, Richard Boire has
been helping companies use their information
to help in making better decisions for over
30 years. His role is more on the analytics/
technical side with a view on this to improve
overall business results

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October 2014 DMN.ca ❰

Engagement & Analytics
Modernization
in a Big Data world By Marc Smith
A
lthough
Big Data
remains,
for some, an
overhyped term,
the reality is that
the explosion
of data is unlike anything we’ve
seen before – and it is here to stay.
Companies big and small are looking
to sustain value and competitive edge
by leveraging all of their data assets –
regardless of how big, how structured,
or how fast moving that data. In
todays’ competitive markets, new
upstarts have the luxury of building
their infrastructure, governance and
organizational processes from scratch
to best monetize their data asset. For
example, organizations like Expedia
are able to increase conversion rates
through offers that leverage real-time
pricing information for hoteliers and
historical customer data to predict
❱ DMN.ca
what offers would be most relevant to
consumers.
However, large organizations who
have evolved their IT infrastructures
over several decades don’t have it so
easy. Much of their IT budget is spent
on operating their legacy systems,
and it is difficult for IT to keep up
with the pace of change that Big Data
demands. Analytics is at the forefront
of this pace. These organizations need
to modernize several key aspects of
their business systems, processes, and
culture; in essence re-architect their
enterprises to compete and thrive in a
data-rich world.
Adapting to modern needs
or habits
Everyone is talking about fact-
based decision making, but are their
organizations set up to do it in the
most efficient way? Let’s face it, most
organizations have old systems and
infrastructure of different vintages,
some that haven’t been upgraded
or replaced in decades. In response
to this, upstart and leading edge
competitors will leverage their data
to out maneuver, smarter and faster,
while laggards struggle with their
systems and fumble through the
new digital world of social media,
mobile, and machine-to-machine
communication in addition to their
impact on delivering services and
interacting with customers.
This also begs the question, is
everyone getting the right information
at the right time? Usually, at an
enterprise scale, the answer is no.
Some systems in organizations
may be better than others, and
individual lines of business within
a large organization may have good
intelligence within their domain.
Rarely will you find large organizations
that have interconnected all of their
// 20
data at an enterprise level. There have
been huge strides in this area through
capabilities in data warehousing, but
those systems are showing stress
in handling the growing volumes of
data and an appetite of the business
for fact-based decisions. Most
organizations rely on decision support
systems to make decisions against
silos of data that are incomplete and
out of date. Often these decisions are
made in the interest of an individual
business unit or department, but are
not what is best for the enterprise.
Trustworthy and complete data has
to be shared across the enterprise and
externally to partners, otherwise no
one has the right, or complete picture.
Leveraging data and analytics
allows companies to experiment
against their populations in ways
that were never before possible.
This provides the opportunity to
use an experimental approach to
October 2014
Engagement & Analytics
determine outcomes of different
tactics and offerings BEFORE they
are rolled out fully. For example, I
may choose to buy impressions on a
website based on a small section of my
population leveraging a new method of
segmentation that generates a higher
conversion rate click through an offer
to a purchase. It is this ability to test-
and-learn that gives organizations the
agility to find the best paths, and start
to double down on those strategies.
Speed of execution is paramount and
can make the difference between
thriving in your market and being
left in the dust, outsmarted by your
competition.
Installing modern equipment
There are very powerful reference
architectures on how to leverage
massively parallel processing (MPP) to
handle big data analytics. These MPP
infrastructures were once reserved
for universities, military science and
research using build-for-purpose and
very distinct software systems. Today
these same reference architectures
with very fast networks and massively
parallel processing servers are readily
available, affordable, scalable and agile.
Enter: the era of the modern data
center. Organizations are deploying
server clusters as networked
appliances, leveraging commodity-
based hardware and commercial
and open-source software that is
readily available to take advantage
of these server farms. These modern
data center architectures are critical
for IT to deliver services that are
fundamental to their business
strategies. IT organizations leverage
virtualization to provision this
infrastructure out as cloud-based
services, or services that can be rapidly
turned on for business consumption
using ways to provide data, analytic
platforms, and full application
systems on-demand.
Utility of these modern data
centers are being provisioned through
cloud-based services, either internally
or externally to the organization.
Internal cloud services are done when
organizations have the means to
create the data centers and provision
applications fast that can integrate
with their legacy systems. New
entrants who do not have their legacy
systems with different vintages
can by-pass this step completely
and leverage cloud services that are
provided from external organizations
that maintain the modern data
centers. This eliminates the need
October 2014
// 21
for organizations to make capital When it comes to data they must In summary
investments in the data center yet adopt systems where data storage As the Big Data phenomenon rages on,
still compete using on-demand cloud costs drop dramatically. Never mind few are considering that it’s more than
services, dramatically lowering their all that effort spent on deciding what just data and software, addressing
barriers to entry. to keep and what to discard – now we notion of culture and adaptation.
can keep it all! We need to change the For large established organizations,
Adopting modern ideas or methods mindset of decision makers to leverage a cultural change needs to take place
There’s a cultural change that needs their data and analytics to run their for organizations to take advantage of
to happen in organizations to take business. Those who don’t will get left Big Data and advanced analytics. Like
advantage of Big Data and advanced behind. any transformation there is room for
analytics. Changing a culture is not innovation and for leaders to emerge
easy, and it takes focus and leadership. Presenting information visually to guide these organizations through
Todays’ leaders need to have a bias Data visualization is the presentation the transition and ensure that they
toward analytics, where strategic risk- of data in a pictorial or graphical emerge healthy and able to thrive in
taking is based on empirical evidence format. Though the term may be new, the digital world of Big Data.
that is driven from analysis of all the the concept is not. For centuries,
available data. These leaders need to people have depended on visual Marc Smith is an Enterprise Architect in
transform their organization from representations, such as charts, graphs the SAS Americas enterprise architecture
a world where our ability to harness and maps, to understand information practice. He works with teams across US
the data is scarce to a world where it is more easily and quickly. As more and and Canada to solve customers’ complex
abundant. Investments in developing more data is collected and analyzed, business problems and to drive sales through
a competency in analytics requires the decision makers at all levels will expertise in high performance analytics.
right skillset to get the data organized, increasingly look to data visualization Marc has been architecting, implementing,
the right infrastructure to use the data software to find relevance among and selling Business Analytics applications
efficiently, and new processes on how millions of variables, communicate and solutions for over 20 years in financial
that data is managed and governed. concepts and hypotheses to others, services, government, telecommunication,
New roles are emerging at senior and even predict the future. retail, health and life sciences, energy, mining
levels of the organization, like Chief Organizations will need to think of and metallurgy industries.
Data Officers (CDO) and Chief their data as a great but unedited
Analytic Officers (CAO). These are story which needs the help of visual
senior level roles who often participate analytics to bring it to life.
in the board of governors in their
organizations. These roles are pressing
forward to develop data governance
practices to set organization-wide
policies on how data is treated
and exploited. Analytic centers of
excellences coordinate activities in
leveraging analytics in operational
decisions and supports the use of
proven practices more broadly across
these organizations. SMART DIGITAL
MARKETING
But where does this leave the Chief
Information Officer? This role emerged
in automation of systems and their
ongoing operations and support.
Big Data and Analytic applications Leading Email Marketing Agency
puts tremendous pressure on how IT + Proprietary Technology
manages and governs their processes
today. For example, release cycles of
classic IT systems takes far too long
to get new systems deployed and are
too rigid to take advantage of this
experimentation near impossible.
Systems need to be able to react Trying to Figure Out Engagement
quickly to changing inputs and new
in this Hyper-Connected World?
models that perform better need to be
deployed fast. We can’t treat analytic
systems the way that we treat classic Download Our Latest
IT system development, and new
governance policies and processes
Engagement Series
for this Big Data phenomenon must inboxmarketer.com/resources/whitepapers
emerge.
CIOs must transform their
infrastructures to take advantage of
these new trends in affordable ways.
DMN.ca ❰
Engagement & Analytics
Big trends
in Big Data
At this year’s Data Marketing conference being held in Toronto on December 10-11,
some of the country’s top minds in data analytics will be sharing insights into some
of this year’s big trends in Big Data. Here are just a few.
By Dina Al-Wer
1. Predictive social listening
There are millions of tweets, Facebook
postings, blog posts, comments, etc.,
taking place every day social media.
Some of that discussion is relevant
to brand marketers and market
researchers.
“It has become almost a cliché, but
marketers don’t control what their
brands are about anymore, people do,”
says Larry Friedman, Chief Research
Officer of TNS Global. “Through social
listening, brands can understand how
the brand conversation is evolving,
and what this might mean for their
businesses.”
Friedman has experience in a wide
variety of research areas, including
brand equity research, tracking,
digital communications, social
media, customer experience research,
strategic/segmentation studies, and
new product development.
In his role as Chief Research Officer
his focus is on consulting with internal
and external clients on study design
of “complicated” engagements, and
helping determine what the results
mean from a business perspective; and
keeping TNS on the cutting edge of
developments in market research.
According to Friedman, data has a
huge role to play in social listening.
“We’re starting to understand
how you can use information from
listening in a quantitative sense to
build predictive models of “business
success”, whether you are talking
about success from an attitudinal
perspective like brand equity, or things
like brand share. To the extent you can
give a manager a heads-up that there
may be a worrying business result on
the horizon, the “data” you glean then
❱ DMN.ca
from social listening can then become
critical to helping managers run their
businesses. We have high hopes that
further developments along these lines
will turn much of tracking research,
for instance, into a windscreen view
of the market, from a rear-view mirror
view of the market. We have a very
exciting future ahead of us.”
Friedman has 3 rules when it comes
to social listening success:
❯❯ Data cleaning is essential to
detecting the “signal in the noise”
– you need to make sure you’re
listening to the right geography; the
content has to be around the right
topic (you don’t want to confuse
mentions of “apple” with “Apple”);
coupon “spam” has been eliminated.
❯❯ Coding has to be accurate.
While there has been great progress
in the field of text analytics, many
listening systems still employ
pretty inaccurate automated coding
systems.
❯❯ Be careful of “magic metrics”.
Many individual listening metrics
have not been connected to business
outcomes. You may need to use
models that combine a wide variety
of metrics in order to find the
actionability you are looking for.
2. Personalization
As a Senior Manager, Customer
Segmentation at TD Bank Group, Nick
Necsulescu is a customer strategy
and analytics leader, with more than
11 years of business performance
measurement experience. He has a
wealth of experience in both digital
analytics, as well as traditional
database marketing. He believes
that personalization is the key to
enhancing customer experience and
that data is the key to personalization.
“It comes down to the customer
experience,” he says. “Personalization
creates a modified, adaptable
experience, in which data and
analytics are used to improve the
communication with the customer.
By knowing the customer better, the
experience is enhanced. As opposed
to customization, personalization is
driven by the organization not the
customer. Personalization is a success
when the customer is more satisfied
with their experience, as a result.”
In today’s omni-channel
environment online personalization,
he says, is critical to a business.
“Digital (online or mobile), are
critical channels for almost every
organization, and it will continue to
become a more significant channel.
Therefore, organizations need to
take advantage of this opportunity
and “positively surprise” the
customer through personalization.
Personalization is also much more
difficult to deploy and implement
digitally, as customer behavior can be
altered potentially in real-time, but
still not as quickly as when a customer
speaks with a rep through a call center
or in person. Therefore, getting it
right in the digital space is where
organizations will win in the future.”
Going forward, Big Data, he
explains, will play a critical role in
merging and combining customer
information and touch points, for the
purpose of enhancing the customer
intelligence and profiles.
“When the customer profile
// 22
Courtesy Data Marketing
has a wealth of information, an
organization’s decision making will
be greatly improved. The less data
available, the more guesses will have
to be made from an analytics and
marketing perspective with regards to
driving a customer experience and the
allocation of funds.”
But marketers are facing a number
of struggles when it comes to
segmentation. First and foremost,
says Necsulescu is how to deal with
unstructured data.
“Properly merging the traditional
structured data sets with the
unstructured is a complex challenge.
Gathering so much digital information
from multiple social media platforms
and making sense of it, is another
challenge. Therefore the work requires
more creativity. Which organization
does this best, will succeed.”
He offers three tips on how to deal
with data and segmentation:
1. Don’t ignore any data source
initially
2. Don’t expect perfection when
merging data
3. Include customer interaction
data points within your
segmentation model
3. Innovation
As the AVP of Research &
Development at AVIVA CANADA.
Hashmat Rohian leads a cross-
functional team charged with bringing
data-driven insights and solutions to
the masses and making fast, fact-based
decision making a reality across Aviva.
As an academic and practitioner,
his work concentrates on taking an
issue-to-outcome execution approach
putting the focus on innovation in the
October 2014
Engagement & Analytics
digital space and tying data, execution,
learning, analytics technology directly
to making better and faster decisions
for improved business outcomes.
“I lead the Data Science R&D.
Basically, my mandate is to help the
organization make fact-based decisions;
better and faster decisions, with the
right visualization tools, technologies,
and statistical techniques that allow us
to make the right decision at the right
time and embedding analytics into our
business processes.”
Data, he stresses, is the key to
making good decisions. Good data,
with good statistical techniques
expedite the fact based decision
making process. It can answer
questions for us, such as; what is
our next best action, what channels,
customers or processes do we need
to optimize, where do allocate our
capital, if the payback is enough to
justify the initial investment of time,
resource, and people, etc.
“When engaging with the business,
there is a bit of education on the ‘Why’
rather than the ‘What’. It’s all about
the ROI at the end of the day. Hence,
you always have to link data analytics,
with ROI and value added.
He has 3 goals when it comes to data.
“Our number one goal, which is our
vision, is to make fact-based, data-
driven decisions. This can be achieved
by deploying predictive analytics, and
sophisticated learning algorithms.
We are implementing new ways of
4. Turning silos of Big Data into
smart marketing
“I consider data an essential part of
my daily work that directly impacts all
the outputs I deliver,” says Dr. Chao
He, the Senior Manager of Strategy,
Insights, and Research at HSBC Bank
Canada. “In today’s organizations,
it is vital for marketing (as well as
other business units) to make data/
fact-driven decisions whenever
possible. For me, dealing with data
means gathering, analyzing, and
synthesizing data from various
resources and eventually generate a
cohesive story that will help business
stake holders not only understand the
key market, consumers, and customer
insights, but also grasp the key
implications and guide their decision
making processes.”
The data He works with comes from
three categories:
1. Customer data, which includes
customers’ transactional and
usage data gathered through their
interactions with the business, as
well as customer feedback gathered
through research and complaints.
2. Business insights as well as
competitive intelligence, which
includes internal business
performance data, and information
on industry trends and competitive
activities
3. Market and consumer insights,
which includes macroeconomics,
market and consumer trends, as
understand what data implies,
(although beneficial, it is not always
needed to know why it is so).
❯❯ Influence: The work is only half
done when the report is written.
It needs to be leveraged to guide
business initiatives in order to
demonstrate the benefits of data.
To influence key decision makers, it
is vital to clarify and communicate
effectively. Clearly articulated core
messages and straightforward
recommendations will make it
easier for stakeholders to turn the
data into actions.
But there are challenges. For instance,
dealing with unstructured data and
making sense of it.
“Today more and more data are
coming as unstructured (e.g. social
buzz), unlike well-structured data, it
takes more advanced techniques and a
fine balance between art and science to
accurately interpret its meaning.”
Combining data and ‘blink’ for most
effective decision making is another
challenge faced by marketers.
“It is not uncommon that some
business partners are still used
to make decisions based on past
experiences or even ‘gut feeling’. In
fact, ‘gut feeling’ from a seasoned
business person sometimes takes far
SMR 046 THE Data Specialists Ad FNL.qxp_Layout 1 2014-02-03 8:02 PM
// 23
less time and is almost as accurate as
a data driven process. Those are the
so-called “blink” decisions, as defined
by Malcolm Gladwell in his book Blink.
However, blink-decisions are not
always reliable, hence the challenge is
to identify when and how to use it. It
will be ideal to leverage blink decisions
to point quick decisions that save time,
and then back up with sound data, but
reality is not always that simple.”
Here are his top 3 tips for marketers
working with silos of data:
1. Understand the business. Only
if you understand the business
objective, challenge, and root
question; your deliverables will
truly add value. So learn as much as
possible about the business.
2. Always know your (data’s) limit.
Understand what it can do and it
can’t do. Do not over-generate.
3. Seek alignment with other data
sources. Try cross checking with
others whenever possible and see
if there is synergy or additional
insights can be identified.
The Data Marketing Conference &
Exhibition will take place on December
10-11, at the Eaton Chelsea Hotel,
Downtown Toronto. For more
information, please see the insert in this
month’s issue of DMN or visit our website
www.datamarketing.ca

DATA
organizing, analysing and storing data. well as social buzz (through social
“My second goal would be to apply listening).
THE

this data within our digital and

offline journeys, hence improving the He has three goals when it comes to data
customer’s journey in a digital arena which he summarizes as the three ‘I’s’.
as well as offline. And my third goal ❯❯ Integrate: “The whole is greater

would be, automation; what part of the
business can be automated? Can fraud
be automated? Can we shave off some
costs and time by automation in our
claim processes?”
He believes that data plays a role
in driving innovation within an
organization. In fact, that’s his job.
“Optimal pricing might touch
customers, but portfolio optimization
might not. Hence, data can guide us
through sustaining and disruptive
questions like quarterly and annual
planning; where should we invest?
Which line of business? How do we
deliver personalized services and
target to segments of one? Data can
help us not only to optimize our
business, but our customers too, it
helps us with marketing solutions as
well as with fraud claims.”
SPECIALISTS
than the sum of the parts” (Kurt
Koffka). Data from different sources
often present different sides of
one coin. It is easy to understand
that different data sources may • Data analytics & customer profiling
complement each other in painting • Consumer, Business & Specialty lists
the full picture. But it is more
• Clean, low NIS rate & high PC level coverage
important to understand that when
data conflicts data, a lot of times, it • Geo-demographic & Ethnic targeting
may generate even greater learning • List matching, cleansing, merging & purging
that can identify the underlying • Address validation & correction
reasons of the conflict, and define
actions to mitigate the gap.
OVER 35 YEARS OF PROVIDING
❯❯ Insights: Data without purpose ANALYTICS & DATA SOLUTIONS
is just random numbers. The key
purpose of any data mining activity
is to extract and distill the story:
What is the key message from the
data? What can be done based
on those learning? To generate For details call or visit
905-474-5271 SMRinfo@smres.com
Insights, the first priority is to

October 2014 DMN.ca ❰

Engagement & Analytics
Measuring engagement
in a hyper-connected
world: Part 3 of 3
Practical tips and methodologies
A recap of the
previous two
articles in the
series
Engagement is the ultimate goal for marketers
and is part art and part science. This series
on engagement aims to build a framework
for marketers. Part 1 of the article series
defined engagement as a holistic measure of
customer interest that is based on cumulative
interactions over time. The six correlates
of customer engagement are: value, trust,
efficiency, relevancy, consistency, and control.
Part 2 outlined the three building blocks and
foundations of engagement (comprehension,
emotional connection, behaviour). Marketers
first need to ensure that customers understand
what their brand is and then an emotional bond
can be nurtured. The behaviour outcome is
about actions: whether it is clicking on content
(response), calling a call centre (customer
service interaction), or shopping behaviour
(recency, frequency, monetary). Part 3 of the
series outlines how companies can measure
engagement.
❱ DMN.ca
By Geoff Linton
M
arketing shouldn’t be this
difficult! Where has the science
and discipline gone? When I look
around at industry conferences I see lots
of busy looking marketers who are stressed
because they have taken too much on to
their plates. Most of the conference rhetoric
is about the plethora of digital tools they are
using. It’s all fluff with little discussion on
marketing fundamentals: target audience,
positioning, and results.
If your company is more customer centric
than product focused then “customer
engagement” should be a part of your core
strategy. Getting a better understanding of
your customers gives your company a big
advantage.
The major marketing challenge is that
today’s customers are always on the go
and they are more empowered (smarter,
better informed, and better connected).
Customers want information and service
on their terms (24/7 and use a mix of online
and offline channels). Building a two way
communications model can be complex.
The second challenge is determining what
customer information marketers should
collect and focus on. Engagement is multi-
faceted but collecting too much information
can overwhelm a marketing team. Start
simple and focus on the core KPIs and
behaviour gaps.
This article outlines how various
organizations are measuring engagement.
// 24
The reality is that many organizations are
only scratching the surface (and reporting
on just a few engagement metrics). But
marketing leaders are more disciplined
and detail focused. They know “what gets
measured gets done.” There are 8 layers in the
“engagement onion” that marketers can peel
back. Some parts of the onion are sweet and
some parts might make you cry!
The engagement model & measurement
methodology
Customer centric marketing has many layers.
It’s like the bulb of a large onion and you can’t
see the core. You need to make a cut so you
can see the layers inside. Each layer tightly
covers the next. Each layer is a different
aspect and dealt with by a separate manager.
Let’s start on the outside and talk about each
layer as we peel the onion back.
Layer 1: Brand
The brand encapsulates everything in
marketing. Brand brings together the features
and attributes into a key value proposition.
There is plenty of noise and competition in
the market and customers need to cognitively
understand what you are about. If they don’t
understand…you have a roadblock.
The uniqueness and strength of market
positioning helps brands stand out. Top
of mind awareness of a brand helps when
customers are “in-market” for your product.
Agencies are stewards of the brand and
October 2014
Engagement & Analytics
marketers use research studies to track
key brand awareness and competitive
gaps. The problem with some research is
that it is self-reported info and purchase
intent measures may not actually
translate to trial/adoption/loyalty.
Brands should have a few key metrics
that align closely with their marketing
plan. Quantify these and measure any
changes. Brand metrics are a rough
indicator and marketers need to drill
down.
Layer 2: Key performance
indicators (KPIs)
The C-Suite looks at high level metrics
and with a more holistic point of view.
Growth in revenue and customer
spend indicates that customer
engagement is strong. The C-suite
also typically focuses on correlates of
profitability like customer tenure or
satisfaction. Many marketers measure
their Net Promoter Score (NPS)
because it measures the satisfaction
of the base (and it is a metric that all
internal stakeholders can understand).
But data driven companies like banks
take it a step further and create their
own proprietary “loyalty index” (this
is often a more accurate predictor
of loyalty). The most sophisticated
customer centric marketers quantify
the average Life-Time-Value (LTV) of
their base.
Everybody on the marketing team
should be aligned to KPIs but the CMO
is ultimately accountable. There is a
reason that CMOs typically have a
short tenure. Tip: Link all the metrics
on the inside of the onion to the
topline KPIs.
Layer 3: Loyalty metrics
Loyalty is a fuzzy concept for many
marketers and it is composed of a
number of factors. Frequency and
patronage is important but average
spend is also a key metric. Customers
who are most engaged visit often, shop
more frequently, spend more money,
and use multiple channels to interact.
They spend a greater share of wallet
with you. The biggest value is through
word-of-mouth and inspiring loyal
customers to refer and share.
Marketing executives (VPs and
Directors) should track their loyalty
metrics and look for changes in
behaviour. It’s very important to track
loyalty across segments and make sure
that core deciles are protected. Don’t
overlook the top 20%; maintaining
strong engagement for your best
customers is critical.
October 2014
Layer 4: Customer service
Customer service is the front line and
where the moment of truth happens.
Whether marketers are efficiently
onboarding new customers, fixing
issues, or cross-selling/upselling, a
lot happens through a customer care
centre. The number of complaints,
saves, and overall customer
disposition are data points that can
be used to measure engagement. Most
marketers in middle management do
a decent job of the general tracking
and they flag major variances but the
customer service data is not often
integrated or actionable.
Layer 5: Other interactions
Engagement is an emotional
commitment and the rise of digital gives
marketers an opportunity to leverage
some new metrics. Leading marketers
sometimes use unique data points to
infer positive sentiment. P&G tracks
“shareability” on their dashboard. One
of our CPG clients (who had a cross-
section of household health products)
tracked the amount of User Generated
Content created each quarter. Ratings
and reviews are also important and if
you can connect reviews with customers
it can provide valuable nuggets. The jury
is still out on the value of a fan or social
follower but social data points can be
factored into an engagement algorithm.
Digital marketing managers are the
ones who need to own this category and
make it meaningful.
Layer 6: Segments
Most brands have a well-defined
primary and secondary target
audience. But marketing execs are
often surprised to find that their
current customers may be quite
different from their ideal audience.
Companies should regularly profile
their customers by demographics
and psychographics. Histograms can
identify skews and gaps.
One of the great things about
database marketing is that marketers
can track activity and satisfaction
rates by deciles. With recency/
frequency/monetary data, marketers
can measure message or shopping
fatigue. Segment management should
be the responsibility of the director
and in large companies you may have
managers assigned to this role.
Layer 7: Campaign
Campaign execution is typically
the spot where marketers spend the
most time. Benchmarking against
the industry is a way to measure
Fast facts
• Brand advocates spend 2x more than average
customers (Source: Branderati, DMnews article
redefining the HVC)
• HVCs are now being profiled on not only monetary but 3
other factors: influence, engagement with the brand, and
advocacy on behalf of the brand.
relative campaign performance. But
the benchmarks need to be based
on specific data and your sector
(otherwise they aren’t credible in the
C-suite). A more precise measure of
engagement is to track momentum
(positive trend of increasing click
stream metrics). If customers really
like you they will open, click, go deeper
on your website, and convert at a
higher rate.
Layer 8: Individual
The most sophisticated marketers
are using automated algorithms
to score individuals. 360 degree
reports provide a detailed history
of a customer’s engagement in your
campaigns (and from this behavioural
patterns can be produced). Points
can be assigned for specific actions
and a total engagement score can be
calculated for each individual. Once
an engagement algorithm has been
created then individual scores can be
easily tracked or flagged.
Conclusion
Marketers have been mystified on
how to measure engagement. But with
today’s technology and breadth of data
available, it’s actually easier than ever
to quantify. The key is for marketers
tap into
targetsource
Canada’s largest and most recognized
TM
consumer marketing database
1 million
emails
Find out how ICOM can be
your single-source solution
for customer intelligence
that can be parlayed into an
omnichannel contact strategy.
// 25
to start with the building blocks of
engagement and then align them with
your measurement strategy. You can
go as deep or as shallow as you want.
Some marketers will be happy just to
peel back 3 layers. Customer centric
and database driven leaders probably
want to get down to the middle of
the onion (layer 8). Remember that
stakeholders at different levels look at
engagement through different glasses
and make sure that you are aligning
your engagement approach to the
C-suite!
Geoff Linton is a co-founder of Inbox Marketer
Corp. and a direct marketing expert with more
than 25 years of applied experience in both
client and agency roles. His experience spans
many industrial sectors, including financial
services, telecommunications, consumer
packaged goods, technology, manufacturing,
and entrepreneurial businesses. Geoff has
guided clients in digital messaging strategy,
and analytics for Inbox Marketer over the last
12 years. Previously Geoff was Associate
Director for the Air Miles program where he
spearheaded major launches and was actively
involved in targeted marketing initiatives and
customer/campaign measurement. Geoff
holds both a P.Eng and MBA from Queen’s
University in Canada. @Geofflinton
2 million
households
1,000
household
characteristics
800.603.4555 | epsilon.com | info@epsilon.com
DMN.ca ❰
Executive Roundtable
Continued from page 10
look to see, based on that question,
what are the best reliable sources of
information and data points that we
to feed our analysis. Then, we gather
our information and build the models,
that will allow the information to
speak for itself and help answer the
underlying question(s).”
“We don’t always start with the
data,” says Warren. “By ensuring a
good understanding of the objective or
question to be answered allows one to
focus attention to data that’s relevant.
Because information is everywhere,
looking for data without a clear
understanding of your objective can
lead down the wrong path.”
“Technology,” says Kestle, “is a very
important factor in this decision.
While I agree that you have to
understand the business problem,
technology is so powerful now that
you can do a lot of trial and error and
let the data speak. Although I think it’s
really important what you’re saying,
you need to start from the data. There
are also a lot of methodologies that
allow the data to just crunch and show
you a result, and you can test it because
of the computing power that we have.
It makes a huge difference in how we
make decisions.”
“I think, that the practical reality
for many organizations is that you
get more demands and requests
for information and insights than
you can deliver on,” says Tyndall,
“and so you need to prioritize them
based on things like how big is the
potential impact of this? You’d like to
do everything for everybody, but the
reality is most companies don’t have
all the time and resources to do that,
so we have to prioritize. But, I do agree
that some information is better than
no information. So, if you can just do a
very little bit, and just say the average
socio-demographic profile of these
people versus these people is this, that
will get you a lot further along than
not knowing even the basics.”
“Just one other important
criterion for determining what data
and analysis to do, and that is what
are you actually going to be able to
implement?” adds Kestle. “It’s very
important in that whole process to
ask, upfront, ‘What are you going to
do with this information? What’s your
plan for the year? How can you put it
into action?’”
“That’s huge, and it becomes the
nice-to-know versus the need-to-
know,” says Humphries.”
❱ DMN.ca
The data analytics buy-in
Despite all that data can do for a
company’s marketing strategy, there
continues to be resistance from the
C-suite to buy into a data and analytics
strategy. So what’s behind this
resistance?
“I think it’s ideology,” says
Humphreys. “There’s an ideology
limitation, where they may not have the
appreciation of what the data can do.”
“To me,” says Kestle, “I see a lot of it
as organizations not having enough
infrastructure and people resources to
do things differently. In organizations,
the change management that a new
data governance or analytics strategy
could require would take a lot of effort
to create a more integrated approach.
And I don’t feel very optimistic about
that happening.”
“I think once you see the first few
successes, even if they’re cobbled
together, of how using this data can
really improve operational efficiencies
in a company, then the C-suite sort
of goes aha, I see how this affects my
bottom line, and I think we should be
investing more here,” says Tyndall.
“I’m seeing, more and more, that our
clients are becoming more agile,” says
Warren. “We’ve said it is difficult to
implement change, but I’m pleasantly
surprised at how quickly they can
react. And, I’m also very impressed
with the leadership I’m seeing.”
The future of data use
“At the analytics conferences, we’re
starting to see the simplification
theme,” says Kestle. “It was a kind of
storytelling for a long time and now
it’s a lot more about simplification and
how the results get presented.”
“And, it’s not about data,” says
Sipidias. “It’s about the high-level
insights, and the trust in the process
of analysis. The trust that comes from
the hard work of gathering reliable
information from great sources. That
goes back to that important mix of
official stats and everything else that
we decide to put together.”
“I also think that the vendors have
to be transparent, the buyer has to
be knowledgeable, and they have
to challenge and test the results,”
says Kestle. “I think that the process
requires a transparency, an open
discussion, and having people
collectively share knowledge about
what the business challenges are that
they’re using the data to solve, and
what the methodologies are that are
helping them. That’s how the industry
can develop the best practices.”
But is there is an expiration date on
good data? For instance, how long can
we keep using the 2011 census data,
while still feeling confident in that data?
“Well, there’s no simple answer to
that,” says Smith, “for example, the
unemployment rates are probably
already out of date even before we
publish them. On the other hand, a
lot of the demographic data for areas
that are stable tend to remain very
stable. A lot of the characteristics of
the population in Nova Scotia are
probably very stable, and probably
survive, largely intact, up to the time
of the next census. On the other
hand, in the suburbs of Calgary
or around Fort McMurray, I don’t
think you would want to really count
on the information there being
particularly long-lived. In fact, part
of the challenge with Fort McMurray
is due to the way in which we conduct
the census, which actually counts
people at their usual place of residence,
and not where they’re currently
residing. This is a problem for the
local municipality; because that’s the
population they have to manage. So,
it really depends—is this a very stable
area or is this a very volatile area? Has
there been a lot of immigration, a lot
of construction? If there has been,
then you need to start being cautious a
couple of years out about how well the
data are representing that population
in that area. On the other hand, for
very static areas, like most of the
Maritimes, and most of Quebec, I
think the demographics hold up pretty
well, and the labour market data
probably holds up decently well until
we get around to the next census.”
The role of social media
According to Kestle, when it comes
to blending social media data with
more traditional sources, it really
comes down to critical thinking, and
understanding what the problem is
you’re trying to solve.
“It’s about understanding the
strengths and weaknesses in the
different data sources and using them
appropriately,” she says. “I don’t think
there’s any blanket solution, it’s just a
lot about having the expertise and ethic
around ensuring that the data are used
for the purposes for which they were
collected and designed, and then using
data from a lot of different sources.”
“I think one concept is you can get
the same information from multiple
sources, but you need to assess the
validity, the reliability, of getting it
from those different sources, and
// 26
make your own decision around what
would be dubbed the gold version of
that information,” adds Tyndall.
The next Census
So what can Statistics Canada, and
other data providers, do going into
2016, to make sure that the data
businesses need is still available? What
are some of the options going to be?
“The next Census of Population
will be held in 2016 and will be in the
same format as the 2011 census,” says
Smith. “So there will be a mandatory
piece and there will be a voluntary
piece. The content of the census has
not been determined yet, neither has
the placement of the specific questions
on the mandatory versus voluntary
parts. One thing that we’re looking at
very seriously is linking income tax to
the census piece so we’ll have income
for everybody on a comprehensive
basis. The questions are still before the
government and there will likely be a
decision made towards the end of the
year on what the specific content will
be, and which questions go where.
“The decision by Statistics Canada
to access the income data from the
tax records for the 100% census is
hugely important, because it means
that we will have an unbiased income
number,” says Kestle.
In 2016, Smith says they are aiming
towards getting really good data for
the larger urban areas, particularly
anything above 5,000, to try and
ensure that the data in those areas are
very robust.
“We’re also looking at ways to try
and get the response rates up on the
voluntary piece. But, at the end of the
day, this is a random sample of 2.5
million households, 6-plus million
people, and the data are therefore
robust. They are not as good as if they
were collected on a mandatory basis,
but they are still very, very robust.”
There are also rumours of a major
new survey conducted by Statistics
Canada looking at job vacancies and
labour markets across the country. It
will also be looking at wage data and
trying to penetrate down to smaller
areas (i.e. down to the economic region).
“To be able to penetrate down to that
level is to deal with the fact that there
is no other way to get at local labour
market job vacancies in a reliable
way that gives data that’s sufficiently
robust to make decisions about things
like temporary foreign workers,” says
Smith. “That’s the plan, but not yet
confirmed. It needs approval from the
governing council, ultimately.”
October 2014
 Data in the
Call Centre
Supplement

• Case study: Information Builders & Scotiabank

• Contact centre enterprise analytics
Data in the call Centre supplement // 28

Case study:
Information Builders & Scotiabank
Canadian bank standardizes on iWay to reduce development costs and boost revenue

W
ith more than 12.5
million customers in
50 countries around
the world, Scotiabank offers a wide
array of products including personal,
commercial, corporate, and investment
banking services. With CAN$527
billion in assets and 70,000 employees,
the organization is one of North
America’s leading financial institutions
and Canada’s most international bank.
As part of its ongoing process
improvement, Scotiabank retail
banking executives needed to
automate a complex sales reporting
process for their branch operations.
The bank’s Information Technology
and Solutions (IT&S) organization
was tasked to deliver on this business
need. Initially the IT&S organization
planned to develop the capability
internally. It considered using
technology from the big stack vendors
as well as specialized point solutions.
The department selected integration
technology from iWay Software
because of its flexibility, its modular
design that permits the addition
of new data sources, and because it
is scalable enough to handle large
infrastructure requirements now and
in the future.
Scotiabank has a number of core
banking systems, which operate on a
variety of computing environments
and have different access methods
and delivery channels. To streamline
integration among various service
delivery channels, such as the call
center and online customer service,
as well as across different product and
service lines, Scotiabank standardized
on Information Builders’ iWay
Software integration technology.
Developers in Scotiabank’s IT&S
department use iWay Service Manager
to create reusable interfaces among
the core banking systems and iWay
DataMigrator to automate bulk data
movement among various information
systems and banking channels.
“iWay is decreasing our overall
number of point-to-point interfaces,
which is a big time-saver for our
developers,” says Martine Lamoureux,
vice president of development for Core
Banking Technology at Scotiabank.
“Whenever we have a new project, we
try to reuse existing iWay interfaces.
Over time we are creating more and
more standardized interfaces based on
our iWay integration gateway. Creating
data extracts gets easier and easier.”
Getting started
Scotiabank IT&S provides global
technology solutions to support the
bank’s core businesses: Canadian
banking, international banking,
global wealth management, and
Scotia capital. Its technology-based
solutions enable Scotiabank to achieve
sustained profitable growth and a
competitive advantage. Canadian
Banking’s use of iWay technology
began when developers were creating
a sales reporting system called Sales
Builder to encourage cross-selling
and to track complex sales-results
rules. Sales Builder supplies crucial
information to employees in the
retail, small business, and wealth
management banking lines of
business, helping to ensure that
sales officers are well informed,
properly motivated, and appropriately
rewarded for their efforts.
With the help of iWay Professional
Services, Scotiabank automated a
tedious data-entry and reporting
process, transposing information from
many different databases and multiple
banking systems to consolidate the
results into a centralized database. The
database then feeds Scotiabank’s Sales
Builder application.
This is just one example of the type
of integration project that Scotiabank
has embarked on with iWay Software.
The banking giant also uses iWay to
streamline corporate acquisitions,
extend the life of its legacy systems
and facilitate international growth
and expansion.
“It doesn’t really matter what types
of business applications we build or
purchase so long as we have a robust
integration platform to connect them
together,” says Mike Bekic, director
of Branch and CRM Technologies,
Scotiabank. “That is our objective with
deploying iWay.”
iWay Service Manager correlates
information from IMS, VSAM, Oracle,
and DB2 databases and transposes
it into a common relational format,
placing the data into distinct event
tables in a DB2 database. iWay
DataMigrator then accesses the
database tables to populate a Sales
Hub data mart, which resides on a
mid-tier WebSphere/Java™/DB2
environment. The Sales Hub permits
sales and marketing professionals to
generate reports about customers,
sales, forecasts, and other essential
customer relationship management
(CRM) activities.
“We didn’t have to write any Java
code to do this,” says Bekic. “It was
all handled using standard iWay
transformation flows and visual
tooling.”
Automating manual processes
Scotiabank also used iWay Service
Manager to develop data interfaces
to the Sales Builder system, which
services about 90 percent of the
company’s sales officers in the
Canadian operation as the basis for
assessing its performance in selling
credit cards, credit lines, mortgages,
and investments.
Scotiabank wanted to replace
its manual sales reporting process,
which was dependent on officer input,
to an automated one that captures
sales opportunities and then reports
the data back to sales officers in the
form of coaching and sales results
reports. Rather than relying on a
manual system, management made
the decision to obtain the information
directly by gathering it from 21
system inputs and feeding it into the
Sales Hub.
In the manual, operator-driven
reporting system, the interpretation
of complex business rules resulted
in inconsistency of reported
results across the 1,024 branches.
By embedding the business rules
within the automated system, better

The organization:
Scotiabank, one of North
America’s premier financial
institutions and Canada’s
most international bank.
The challenge:
An outdated sales
information infrastructure
was creating delays in the
delivery and validation of
key information needed
to support critical growth
strategies.
The strategy:
Create a comprehensive
sales reporting
environment with
automatic data feeds
from a variety of financial
product lines; use iWay to
capture data from multiple
retail banking systems
to deliver weekly sales
reports for the bank’s
1,024 branches.
Information Builders
solution:
iWay Service Manager,
adapters, DataMigrator,
WebFOCUS, and
Professional Services.
The results:
Scotiabank’s developers
spend less time on
integration projects with
less code to maintain; the
business can open new
channels more quickly;
sales staff gain faster
access to results. Banking
officers free up more than
70,000 hours for more
customer interaction time.

❱ DMN.ca October 2014

Data in the call Centre supplement
consistency and improved reporting
integrity have been achieved.   productive and more satisfied, so
The CRM system gives Scotiabank’s
Customer Knowledge and Insights
department the intelligence it needs
to reach out to customers and qualify
leads in the contact management
system, aligning each customer’s
profile and product mix with the skill
set of the correct sales officers.
“With the kind of capacity we have
created here we can realistically expect
to generate an additional $250 million
in annual sales volume across all of the
products that we deliver to customers,”
says Mike Henry, senior vice
president of Customer Experience and
Distribution Strategy at Scotiabank.
“That translates into millions of
dollars in bottom-line lift for us.”
Henry estimates that Scotiabank
spent about $6 million to develop these
IT capabilities for an expected return of
$2.5 million per year on a go-forward
basis. Just as important, Scotiabank
has received a positive response from
the sales staff. “Employees are very
pleased that we have made them more
productive by automating these CRM
processes,” he notes.
Creating a flexible rules engine
Information Builders Professional
Services used the iWay Business Rules
Engine and iWay Complex Event
Processing capabilities to govern
some of the CRM data management
processes. The project team,
consisting of subject matter experts,
value by making our employees more
they can focus on what matters most:
our customers,” explains Henry. “We
devised more than 500 business
rules to automate a very complex
and boring activity for our personal
bankers and financial advisors. This
successful project freed up more than
72,000 hours per year that these staff
members can now spend advising
customers. It gives them more time
to provide the excellent service that
helps our customers to get ahead
financially, and that’s what Scotiabank
is all about.”
Reusing iWay interfaces
Bekic credits iWay Professional
Services for helping Scotiabank’s
in-house staff to understand the iWay
integration platform as part of these
ambitious IT endeavors. For example,
they designed the rules engine to be
callable from an XML process flow,
which permits rules to be dynamically
added or changed without modifying
the associated business applications.
“The key to this architecture is to
abstract the business rules away from
the product systems,” says Bekic. “We
don’t need to change 15 or 20 systems
to update the rules. We just change the
business logic in the mid tier using the
web-based interface.”
Scotiabank has created a Center
of Expertise (CoE) to promote best
practices for using the iWay integration
environment, along with a robust
manually transform the data.
“The iWay toolset has allowed us to
be more productive by creating web
services rather than writing a host
transaction or transformation,” Bekic
explains.
Lamoureux estimates that creating
new interfaces with iWay takes about
half the time of what they formerly
had to do in Java. Scotiabank applied
these economies of scale to a Liquidity
Analysis engine application, used by
their treasury department, as well
as to a new adjudication module. She
foresees further standardization using
the iWay platform, since it includes
a flexible integration engine and
hundreds of adapters to interface with
various databases and applications.
Whether it’s extracting, transforming,
and loading data; handling
sophisticated file transfers; monitoring
business activity; or managing
complex business rules, Scotiabank is
leveraging iWay’s ability to perform
many types of integration scenarios.
Measuring success one system
at a time
Scotiabank has several gauges for
measuring the success of each iWay
project, including development time,
// 29
the ability to open new business
channels more quickly, and a growing
repository of integration assets, which
means they don’t have to develop
each new interface from scratch.
Ultimately, Scotiabank’s senior
management wants to have a common
integration platform not only for its
operations in Canada, but potentially
forother core business groups outside
of Canada.
Scotiabank plans to use iWay
business activity monitoring
technology to automatically update
the Sales Builder reports as key events
occur, and iWay MFT technology to
further automate the movement of
large volumes of data. Bekic and his
team are also exploring iWay Data
Quality Center to improve the overall
accuracy of customer information and
to simplify regulatory issues.
“Our partnership with Information
Builders is very important to us,” Bekic
concludes. “It’s a constant learning
environment, and we see our progress
as a win-win for both companies.”
For more information visit
http://www.informationbuilders.com

iWay Professional Services, and the
Scotiabank’s Integration Competency
Center personnel, developed a series
of business rules to determine what
depicted a sale and how that sale
was funded.
For example, if a sales officer
helps a customer invest $10,000 into
Certificates of Deposit, and then a
month later persuades the customer
to roll $5,000 of that investment into
a mutual fund, there is a different
compensation structure for each
type of deposit. iWay updates the
appropriate banking systems and
applies a consistent set of business
rules to govern how the sales officer
will be compensated for each type
of sales activity. If a sale involves a
transfer of funds from one location to
another, the system can reconcile the
results from new and previous sales.
This is important since the bank bases
sales performance on net new money
coming into the bank.
“This was not just a technology
project. It was about creating business
See More.
enterprise service bus as a universal
integration layer. The service bus
includes a fully redundant enterprise
topology with automatic failover to
ensure business continuity. iWay Know More.
receives financial, product, and sales
Smarter marketing and
data via web services interfaces, batch
interfaces, and interactive data-input brand protection
procedures, transforms it into a using email data
common format and loads it into a
data warehouse. iWay Managed File
Transfer (MFT), powered by iWay
Service Manager, automates multi-step Return Path gives you the
integration scenarios with complete data-driven insight you need to build an email
auditing, notification, and security. program that connects with more customers, drives
All iWay integration processes are
higher marketing engagement, and protects your brand.
reusable, so Scotiabank can leverage
these ETL and MFT assets for other For more information about how Return Path
business scenarios involving these
can improve the way email works for your
core banking systems. For example,
the bank also used iWay to streamline
business, please contact us.
the development of a new liquidity
system, which has 14 interfaces to
legacy applications. Using the iWay
integration platform and adapters 416.979.2049 • returnpath.com
simplifies integration tasks for
developers since they do not need to 1235 Bay Street, Suite 400, Toronto, ON M5R 3K4

October 2014 DMN.ca ❰

Data in the call Centre supplement
Contact center
enterprise analytics
Advances in decision technologies enable a whole
new class of contact center analytics
I
t’s surprising to think the role
of analytics and computer-aided
decision-making in contact
centers remains narrow in scope.
Yet it is. Analytic tools like those
for business intelligence, speech
analytics, performance management,
and workforce management serve
only a few focused purposes,
primarily data capture and data
presentation.
Put in greater perspective,
while such systems help analysts
solve specific low level tactical and
business problems, none have kept
the promise of the truly intelligent
decision support computer. These
tools and systems do not serve to
improve strategic decision-making
across the enterprise.
The strategic decision-making
cycle
In contact centers, how and why
do executives make strategic
decisions? What is the standard
process? Like most operations, the
contact center is 90% reactive and
10% proactive. Although executive-
driven improvement initiatives are
common, the majority of decisions
are born out of necessity — they are
reactive decisions to changes in the
center’s operating environment.
Because of this, the decision-
making process is typically:
1. Monitor the operation. Analysts
determine whether operating
conditions such as handle times or
contact volumes have changed or
are outside acceptable parameters.
2. If there is a change, determine
the range of likely scenarios.
Given the uncertainties of
❱ DMN.ca
a changing operational or
business environment, it’s up
to the forecasting team to stick
their neck out and say “here’s
where we believe we will come
in.” Conversely, the better
forecasters will stick their neck
out less and say “it could be X,
Y, or Z.” Determining the set of
possibilities will lead to the best
business decisions.
3. Develop new plans for all
scenarios. Each scenario must be
vetted and the resulting business
plan (the decision) is determined.
4. Decide and implement. Simple.
5. Repeat.
The contact center decision
support ideal: a crystal ball
Ideally, an intelligent decision
support tool for contact centers
would mimic the steps of the
decision-making cycle, and would
help executives answer specific
and important business questions
at every stage. This system would
serve as the executive’s “crystal
ball,” helping them understand
the operational and financial risks
and trade-offs of their business
alternatives.
“Handle times are creeping up,
what should we do?” “Should we
open or close centers?” “What is the
effect of combining email agents
with phone agents?” “Service is
slipping, should we outsource
technical support?” For contact
centers, this crystal ball would need
to be:
❯❯ Comprehensive in scope
❯❯ Enterprise-wide
// 30
❯❯ Long-term/strategic
❯❯ Quick and provably accurate
❯❯ Flexible/robust
❯❯ Able to analyze business risk
❯❯ Actionable
Enter enterprise analytics
Enterprise Analytics is the
application of specialized
decision technologies to contact
center performance monitoring,
forecasting, scenario development,
plan development and evaluation,
business risk analysis, and
ultimately, strategic decision-
making.
Distinct mathematical
modeling technologies, coupled
with improvements in computer
processing speed, now enable
more sophisticated contact
center analytics. By working in
conjunction, technologies for data
warehousing, forecasting, discrete-
event simulation modeling, and
mathematical optimization (integer
programming) derive “super model”
power to improve decision-making
significantly for contact centers.
Further, when used together
with a strong business process
improvement orientation,
these technologies enable the
development of an Enterprise
Analytics business process. There are
four such technologies/processes:
1. Automated forecasting and its
appropriate role
In many organizations, the role
of forecasting is both simple and
narrow to determine expected
contact volumes and handle times
accurately. It is narrow because
contact volumes are neither the only
nor the most important business
October 2014
Data in the call Centre supplement
driver to forecast. It is simplistic
because the true value of a forecasting
team is not a single forecast, but is a
part of a contact center monitoring
system and a larger planning process.
Leading analytic organizations
recognize this, and view forecasting
differently:
❯❯ They view forecasts as the baseline
and variance to forecast as a
warning indicator to understand.
They worry less about forecasting
“error,” and instead assume that
any variance to forecast is either
natural variability of the business
or a change in the environment that
needs to be explored.
❯❯ They automate forecasting so they
can apply forecasting expertise
to every important contact
center metric. It is essential to
make the forecasting process as
easy as possible, to allow for the
use of sophisticated forecasting
methodologies.
❯❯ The best forecast doesn’t necessarily
mean the lowest “error.” The
final downstream product of
the forecast is a set of decisions,
and the forecast that produces
the best decision is the better
forecast. When viewing competing
forecasting methodologies against
hold-out data, the best forecasters
take the next logical step and
ask, “which methodology poses
the most operational risk to the
organization?”
Among several mathematical
technologies for forecasting, the
most important item to consider is
that the data stream being forecasted
matches well with the mathematical
methodology chosen. Contact
center executives can improve
their forecasting process by simply
reminding forecasters that the
purpose of the forecast is to make
decisions “reliably.”
2. Automated variance analysis
Variance analysis is normally used
in the context of budget analysis.
That is, variance to budget is an item
explored but only if line item costs are
too high. This is clearly short-sighted.
In contact center operations, variance
to plan should be analyzed regularly
to certainly include costs, but also
to include all major assumptions
associated with the strategic operating
plan. This includes (by center and
staff group), wage rates, handle times,
October 2014
volumes, vacation plan, employee
attrition, and so on.
Variance to forecast for each of
these items should be investigated for:
❯❯ A mistake: Was there a math error
when developing the forecast?
❯❯ Root cause: What is the reason,
internally (the operation)
or externally (the market
environment, for the variance?
❯❯ Permanence: Is this variance
expected to be part of a long-term
trend or is it a single event?
❯❯ Manageability: Can managers
bring the item out of variance
back into plan?
By researching variance, an operation
has the best chance of developing the
appropriate tactical or strategic plan:
the business response.
3. Developing response plans
Enterprise Analytics require two key
planning capabilities. The first is the
ability to simulate the operational
performance of contact center
environments quickly and accurately.
The second is to automatically and
optimally develop best response
business plans given the appropriate
business constraints. The two
mathematical problems to solve, in
more detail.
First, a quick and accurate model of
the whole, interdependent operation
is required. A contact center operation
must have the ability to answer
specific what-if questions accurately,
like: “If handle times increase over the
next 7 months, what will my service
levels be if I do not hire?”
In the past, analysts relied on the
notoriously inaccurate Erlang equation
for answering strategic questions.
Now that contact centers are multi-
skilled and multichannel (email, chat,
and so on), the Erlang approximation
is even more misleading. The better
modeling technology is discrete-
event simulation, which allows for
the accurate analysis of any contact
center system, whether single-skilled,
multicenter, multichannel, or
multi-skilled. It specifically answers
questions like: “If I were to do X, what
operational or financial performance
could I expect?”
Second, it’s imperative that the
Enterprise Analytic function have
the ability to develop best responses
to business environment changes
or specific what-if scenarios quickly,
// 31
via an optimal capacity planning than manual or spreadsheet planning
model. Integer programming is a processes.
mathematical modeling technology These technologies allow a different
that addresses problems of this kind take on the planning process — they
by answering questions precisely, allow us to monitor and optimally plan
such as: “What is the fewest number for business uncertainty.
of agents I can hire, in which groups, EProm is a methodology that
in which centers, and at what time of enables intelligent decision-making in
year to meet increased call volumes an uncertain environment. Simply, in
over the next 18 months? Or, would the face of uncertain scenarios, each
overtime cover these peaks?” permutation of business response to
With discrete-event simulation possible operational scenarios can be
and integer programming working planned out. This can be as simple an
together, contact centers can perform exercise as developing response plans
what-if analysis (simulation) quickly for each of the possible scenarios. But
and accurately, and can determine this is the twist: analysts must also
their best business response (integer determine what will happen if their
programming) quickly and optimally. assumptions are wrong. They need to
know what the operational risk is of
4. Enterprise performance-risk missing a forecast and choosing the
outcome matrix (EProm) wrong course of action.
The final step in the Strategic Analytic
process may be the most important. This article is adapted from the white
Because mathematical technologies paper “Contact Center Enterprise Analytics:
automate much of the strategic Advances in Decision Technologies Enable a
planning process, the time required to Whole New Class of Contact Center Analytics,”
forecast, build what-if scenarios, and by Ric Kosiba, Ph.D. Kosiba is vice president of
determine the best business response the Interaction Decisions™ strategic planning
to every scenario is surprisingly solutions group at Interactive Intelligence, Inc.
short. More importantly, it is of a Download the full white paper
significantly higher quality (that is, at www.inin.com/cm
more accurate and comprehensive)
Consumer Data for Census
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(including the 6-digit postal code):
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Contact us for a tailored solution to your data and analytics needs
220 Duncan Mill Rd., Suite 519, Toronto, Ontario, M3B 3J5
416-587-9139 • EnquiresDM@ManifoldDataMining.com
DMN.ca ❰
// 32
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Resource Directory // 33
FUNDRAISING LIST SERVICES
ResourceDirect2011_Layout 1 8/30/11 3:36 PM Page 1

Get more out of your

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Date: July 4, 2013 AD: Carter PLEASE NOTE • Customer Profiling
Client: Cleanlist.ca AM: Sinclair This file has been optimized for its intended

Docket: 3540 Version: F6

application only. For uses other than intended
please contact Seed for alternate formats.
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 // 34 Resource Directory
LIST SERVICES Mailing Services

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adm_dm_4c.pdf 1 5/24/2013 4:35:39 PM

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to advertise in
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