Skip to main content

Why Precision Marketing is Still an Oxymoron

Across all industries and company size, growing revenues is a top priority for organizations. This holds true for all business models -- business to business (B2B), business to consumer (B2C), and not-for-profit. Moreover, top-line growth is not the only pressure faced, according to an Aberdeen Group market study.

Marketers also seek to do more with less. They are pressured to identify and invest in their most valuable or profitable customers while optimizing both budgets and resources applied. In short, marketers must find ways to communicate, interact and provide service to customers based on value metrics.

Ideally, highly profitable customers would receive more attention, service and resources than less profitable ones. Customer retention and acquisition rates among preferred segments or profiles would increase, as well as market share among most valuable customers.

Aberdeen Group surveyed and interviewed 200 companies to gain an understanding of how best-in-class organizations select, deploy and measure precision marketing techniques. Their research demonstrates that effective precision marketing techniques leads to improved customer retention rates, higher revenues from up-sell and cross-sell campaigns, and enhanced levels of customer satisfaction.

Enterprises that deploy precision marketing enjoy a greater share of each customer's wallet. More than fifty percent of top performers have customers who purchase multiple products or services from them annually -- twice the rate of other benchmarked groups.

Overall, top performers that hold higher competencies in advanced precision marketing capabilities also enjoy a higher return on investment in key performance metrics. Case in point, 51 percent of these top performers -- in contrast to only 10 percent of other benchmarked groups -- attained customer satisfaction levels in excess of 70 percent.

While enabling technologies and service providers facilitate the planning and execution of both inbound and outbound marketing campaigns, enterprises are more challenged by lack of internal expertise in precision marketing techniques. The majority of survey respondents revealed they lack the ability to establish and measure meaningful performance metrics.

Ironically, organizations struggle to secure the budget and resources necessary to improve precision marketing techniques, but lack the ability to build a business case and gain buy-in through the establishment of measurement of key performance indicators (KPI), metrics or goals.

All respondents confirmed they are addressing challenges from a technology, process, performance and organizational perspective. They realize that no quick-fix solution exists, but that a more holistic, process-driven approach to customer interactions, comprised of closed-loop marketing techniques is necessary to drive continuous performance improvements in precision marketing.

In the meantime, bearing in mind the "experienced talent" void, the notion of precision marketing remains an oxymoron within many organizations. Therefore, Aberdeen suggests to pro-actively hire marketers, business analysts and statisticians with extensive precision marketing expertise and create an in-house center of customer excellence.

Popular posts from this blog

Open Banking Usage to Grow by 470 Percent

The Open Banking business model has been advantageous for Third-Party Providers (TPPs), helping them to extend their offerings into other areas of financial services with new capabilities. Open Banking is also advantageous for traditional banking institutions, despite the perceived loss of custodianship over their data, by providing greater accessibility to more bank services. Furthermore, Open Banking can help serve Mobile Internet providers that are able to leverage it to create tailored services according to customers’ preferences and/or economic limitations. Open Banking Market Development Since traditional banking services are made more convenient by TPPs via greater data access, customers can proactively manage their finances and shape the development of new financial offerings. This is particularly noticeable in the realm of Digital Payments, where retail merchants and customers transact through eCommerce, which has the greatest number of use cases for Open Banking. These includ

Global Digital Business and IT Consulting Outlook

Across the globe, CEOs and their leadership teams continue to seek information and guidance about planned Digital Transformation initiatives and the most effective enterprise organization change management practices. Worldwide IT and Business Services revenue will grow from $1.13 trillion in 2022 to $1.2 trillion in 2023 -- that's a 5.7 percent year-over-year growth, according to the latest market study by International Data Corporation (IDC). The mid-term to long-term outlook for the market has also increased -- the five-year CAGR is forecast at 5.2 percent, compared to the previous 4.9 percent. Digital Sevices & Consulting Market Development IDC has raised the growth projection despite a weak economic outlook, because of vendor performances across 2022, growth indicators from adjacent markets, increased government funding, and inflation impacts. The actual 2022 market growth was 6.7 percent (in constant currency), which was 87 basis points higher than forecast last year, alth

Mobile Device Market Still Awaiting Recovery

The mobile devices market has experienced three years of unpredictable demand. The global pandemic, geopolitical pressures, supply chain issues, and macroeconomic headwinds have hindered the sector's consistent growth potential. This extremely challenging environment has dramatically affected both demand and supply chains. It has led to subsequent inflationary pressures, leading to a worsening global cost of living crisis suppressing growth and confidence in the sector. In tandem, mobile device industry stakeholders have become more cautious triggering market uncertainties. Mobile Device Market Development Operating under such a backdrop, the development of mobile device ecosystems and vendor landscapes have been impacted severely. Many of these market pressures persisted throughout 2022 and now into 2023, borne chiefly by the smartphone market. According to the latest worldwide market study by ABI Research, worldwide smartphone shipments in 2022 declined 9.6 percent Year-over-Year