Lessons In Customer Intelligence From Santa Claus, Marketer Extraordinaire

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Today’s column is written by Yannick Koger, principal consultant at Infinitive.

Right about now, many digital marketing pros wish their campaigns and programs were guaranteed to produce as much magic and happiness as that big round guy in the baggy red suit who keeps showing up everywhere.

Believe in him or not, it’s pretty clear Santa knows a thing or two about delivering the goods using deep customer intelligence. Before you assume I’ve downed one too many eggnogs, let’s have a quick look at the lessons St. Nick offers us.

For one thing, he understands his customers’ journey and knows how to track his customers from beginning to end. In today’s omnichannel reality, most marketers have limited ability to control the brand conversation and move prospects in a neat and orderly way down their marketing funnels. This creates angst for marketers because they lose sight of what their customers are doing and therefore struggle to streamline the journey to purchase.

Santa, on the other hand, clearly understands what his customers are doing. His mechanism to track customer behavior over time involves highly dedicated field representatives, mostly parents and an increasing number of elves on shelves.

While few marketers can achieve that level of omniscience, most could do better if they merged telling clues from social media chatter, behavioral and transactional data from both online and offline channels and even findings from traditional marketing research, such as test markets or focus groups, to gain deeper customer insights. Obviously, triangulating answers from various data types isn’t as clear and easy as a Christmas list, but marketers who do it well greatly increase their chances of lighting up their customers’ faces during any time of year.

Indeed, most marketers would kill for the kind of clear, personalized and actionable expressions of customer intent that Santa gets from Christmas lists. This killer customer intelligence app has been Santa’s secret sauce since day one.

How else can he deliver the ultimate customer experience? He gets it in person at the mall and via snail mail, email and social media; Instragram, Pinterest and probably SnapChat, too. Talk about unstructured data – think of all those scribbled lists from 4-year-olds that have to make it into the North Pole’s data centers.

But managing all those inputs properly is what it takes to execute the right gift to the right child at the right time. Obviously, Santa’s one-channel fulfillment model – the chimney – is much simpler than the complex, omnichannel environment where modern marketers must make their offers.

Obviously, the North Pole’s customer data model and customer scoring algorithm are highly proprietary, but we can speculate about the basic components. For starters, there is data storage for records on a few billion kids around the globe, plus the hundreds of billions of former customers who have opted out, usually before they become teenagers. This is a lot of raw profile and behavioral data to store and analyze, so clearly the biggest of big data infrastructure is involved.

Outside of storage, data quality and governance are major considerations, too. Many marketing organizations underemphasize these vital steps, but no truly optimized cross-channel campaigns are possible without them. Even more to the point, advanced analytics – the conversion of data to insights to actions – is basically impossible when data quality is suspect. In other words, the key to Kris Kringle’s kingdom might just be his black-belt approach to data management.

Though the nice-versus-naughty binary segmentation model probably strikes many marketers as pretty crude, Santa’s team of data scientists and analysts have no doubt conducted extensive modeling to confirm that this is the optimum level of precision, based on their advanced algorithms. These are the attributes that matter most, in terms of customer satisfaction, profitability and engagement, which form the heart of Santa’s go-to-market strategy.

Some marketers overdo it by modeling every possible variable they can about customers, rather than just focusing on those that matter most, which may be where a majority of the business value lies. The most effective data-driven attribution models have neither too many nor too few variables.

In addition to what Santa can do from a customer intelligence and marketing perspective, there are some very important underlying lessons in how Santa pulls it off. First and foremost, there is strategic focus.

The entire team – elves, reindeer, Mrs. Claus, etc. – focuses relentlessly on one goal: getting the right gift to the right kid by the right time. Digital marketing teams can and should be so single-minded. Whether it’s revenue optimization, increased brand loyalty or increased product awareness, each campaign will have a different objective, but everybody from sales to ad ops to external agencies should know what it is.

Santa is fully committed to his customer intelligence strategy and approach. Early on, Santa envisioned how little pieces of paper from children could be leveraged into meaningful, actionable pieces of information to enable his operation to succeed. Not only did he set a vision, he was relentless in ensuring organizational alignment around the vision and dynamically shaping it over time.

Santa also has the right sled to ensure he is able to deliver the goods for children all over the world. Of course, marketers don’t need sleds, but technology is analogous and becoming increasingly critical to a CMO’s success. Web analytics, online-offline data integration via data-management platforms, customer database technology, CRM technology, demand-side platforms and digital advertising order management systems – the gamut of tools and technology for marketing is pretty astonishing. Santa right-sizes his technology instead of chasing after the next shiny new object. He has stuck to supporting his operation with the right technology and made the appropriate updates when necessary.

Oh, sure, Santa Claus may be a mythical character, but his data-driven marketing lessons are very real. A clear strategy and a focused mission plus the right team and technology can get marketers delivering the same level of highly personalized and magic experiences that will be delighting Santa’s customers just a few days from now – and the same time next year, too.

Now back to the egg nog.

Follow Infinitive (@InfinitiveRocks) and AdExchanger (@adexchanger) on Twitter.

 

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