Driving Growth with Customer Data Management

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1 Driving Growth with Customer Data Management How Data Maturity delivers big returns on marketing investments By Marian DeSimone Marketing Director Business Value

2 Successful modern marketing depends on the ability to create and manage a company s most important and valuable relationships with customers and prospects. While that responsibility isn t particularly new or revolutionary, how marketers do it is dramatically different in the digital age. Their success building long-term, sustainable relationships lies in the ability to develop and execute on highly refined, interconnected lead generation practices that let them effectively target, nurture and close. Respondents by Company Revenue Respondents by Company Revenue >$1B 33% $ M 15% $ M 23% Our latest forecasts show that enterprises are realizing the most valuable assets they have are solid, long-term customer relationships $500-1B 29% Respondents by by Industry Louis Columbus, Forbes contributor quoting Gartner, Inc. Organizations that achieve superior levels of lead generation frequently have mature data management practices underlying this marketing relationship engine. To gain a deeper understanding of the connection between data maturity level and marketing best practices, Dun & Bradstreet engaged a team of world-class analysts. Their research was designed to uncover: The connection between data maturity and sales and marketing success Transport Utilities Retail 6% Other Whlsle/Dist 9% Mfg 27% Comm Media Svcs 18% Fin Svcs 15% HC 3% LifeSciences Insurance Education 1% Govt 1% The value of investing in customer data management best practices Quantifiable marketing performance improvement resulting from the use of data best practices The researchers selected 135 companies, comprising both non-customers and customers of Dun & Bradstreet. These companies were surveyed about the current state of their Data Maturity and their relationship-building best practices, including their use of third-party data enrichment. Participants represented a variety of company sizes, from $100 million to more than $1 billion in revenue, and business functions including IT, Sales, Operations, Marketing and Analytics. The companies were spread across six main vertical markets: Manufacturing, Commercial Services, Finance, Retail, Wholesale/Distribution and Insurance. The path to optimizing your marketing efforts to develop sustainable B2B relationships can be circuitous. The most straightforward path is to focus on Data Maturity at an organizational level, which positions you to take advantage of best practices and not risk making investments that fail to deliver on their potential. Before we dive into the findings and best practices as revealed in the survey findings, we should explore Data Maturity on a more granular level. 2

3 WHAT IS DATA MATURITY? Data Maturity is the degree to which an organization manages its data in a strategic manner, transforming information into insight and, eventually, turning it into knowledge that is used to enable corporate objectives. While many organizations assume they are quite mature, leading industry analysts say that only 2-5% of companies actually qualify as highly data mature. Analysts also agree that to capture the financial business value required to justify sizable investments in Customer Master Data an organization must reach a minimum level of maturity. As companies progress along the Data Maturity spectrum, it becomes easier for them to recognize the efficiencies and effectiveness that come with their utilization of marketing best practices, such as market segmentation, digital optimization, personalization, lead nurturing and lead scoring. The benefits of reaching the highest level of Data Maturity include: Companies being able to manage their customer data as an asset Obtaining a single version of the truth that will flow throughout enterprise, technology platforms, and processes Achieving a data-centric approach that will be used in strategizing and executing on decisions that impact cross-functional areas of the business, from marketing to finance and beyond Leveraging best practices that will finally deliver on promised performance and financial returns Ultimately, our findings show that data-mature companies have a greater opportunity to build the sustainable B2B relationships that lead to growth. While many organizations assume they are quite mature, estimates are that only 2-5% of companies researched actually qualify as highly data mature DATA: THE FOUNDATION FOR DRIVING REVENUE In our study, data quality proved to be the foundational element in achieving positive financial returns. It isn t surprising that mature organizations leveraged quality data to reduce unnecessary costs by creating customer data management efficiencies. Removing duplicate records, creating accurate customer hierarchies and eliminating errors directly impacted their bottom line via efficiency gains of 20% vs. those of less mature organizations. What is surprising is the degree to which mature organizations deployed high quality, enriched data to drive sizable results across their marketing practices. From target and capture practices to nurture and close, it is apparent that customer data best practices lead to better B2B relationships and changed marketing funnel outcomes significantly. Mature companies that are committed to creating and maintaining quality data are superior at targeting, capturing and nurturing leads and as a result, generate more new and higher revenue gains against customers than those who do not demonstrate that same level of commitment. THE SCOPE OF SUCCESS When we analyzed the findings of our study there was a direct correlation between organizational Data Maturity and company performance. Overall Success impacted by Data Maturity Data-mature companies are more successful than less mature firms, with higher-maturity organizations experiencing 12% higher relative improvements across the Customer Life Cycle due to better customer data. On average, higher maturity organizations experience 20% greater improvements across support, operations/ finance and customer data management with Dun & Bradstreet customers experiencing improvements in excess of that 20%. Mature organizations experience 20% higher financial returns on their master data investments based on 20% more revenue and 10% fewer costs over their low maturity counterparts. 3

4 Marketing Success impacted by Data Maturity Utilization of data enrichment solutions delivers approximately 7% higher productivity improvement and 10% higher improvements across sales and marketing segments vs. organizations that do not utilize data enrichment. Target/Capture: 12% better campaign segmentation, improving identification of best potential customers, with Dun & Bradstreet customers managing campaigns an additional 46% better than mature non-customers. Nurture: 16% better use of customer information to nurture leads and prepare them for sales, with Dun & Bradstreet customers experiencing 23% better use of information to nurture leads. Close: 12% improvement in closing deals from leads sent from marketing, with Dun & Bradstreet customers closing 29% more sales over mature non-customers DUN & BRADSTREET CUSTOMERS SAID In our survey, Dun & Bradstreet customers reported that they use data and marketing best practices to identify their most valuable prospects and nurture them in the most effective way, until they can convert them to profitable customers. In fact, Dun & Bradstreet customers manage their marketing campaigns and nurture their highest potential relationships 46% better than data mature non-customers. As a result, a Dun & Bradstreet customer is able to capitalize on improvements in nurturing to drive a 29% increase in closing over non-customer peers. DUN & BRADSTREET CUSTOMERS WHO USE BEST PRACTICES EXPERIENCE A 10% INCREASE IN REVENUE OVER NON-CUSTOMERS PREDICTIVE TARGETING LEAD DEVELOPMENT SALES ACCELERATION TARGET/CAPTURE NURTURE CLOSE BEST PRACTICES More segmentation with deeper data profiles within those segments. Multi-dimensional campaigns targeting by industry, geography, linkage. Higher MDM/CDM-mature companies manage campaigns 12% more effectively. Unified profiles of leads are enhanced by additional firmagraphics from third parties. Wider arrays of lead sources increase opportunities for success. IMPROVEMENT Higher MDM/CDM-mature companies usecustomer information 16% more effectively. Consistent customer/prospect profiles are streamlined yet comprehensive. Data profiles for existing customers are used to explore cross-sell. Higher MDM/CDM-mature companies close sales 12% more effectively. Dun & Bradstreet customers manage campaigns 46% more effectively than non-customers. Dun & Bradstreet customers use customer information 46% more effectively than non-customers. Dun & Bradstreet customers close sales 29% more effectively than non-customers. 4

5 FINANCIAL IMPACTS We have highlighted the connection between Data Maturity and the ability to capitalize on marketing best practices but have not explored potential financial impacts that a Data Mature customer might experience as a result of using these best practices. We selected two marketing best practices (Predictive Analytics and Lead Scoring) and used the expected improvements based on study findings to predict the financial implications. The survey suggested a firm utilizing Predictive Analytics and Lead Scoring, powered by superior data, could expect a 6-8% improvement in campaign capture rates, B2B contacts and call to close ratios. Translating these levels of predicted improvements into financial terms, a data mature organization with $100 million in marketing related revenues could expect to drive an additional $12 million in revenue by implementing Predictive Analytics and Lead Scoring. These are just two of the many marketing best practices that can be deployed to drive growth. It could be surmised that with continued implementation of advanced marketing practices, data mature organizations can anticipate even higher levels of financial return. It has been widely reported that CMOs say they are unprepared to leverage the current data explosion. To gain or maintain a competitive advantage, it becomes an imperative to harness the power of data and lead the charge toward continuous improvement of organizational Data Maturity. Customer Data programs should be viewed as a part of the wider enterprise information management strategy, and forward-looking customer data initiatives should be implemented in a phased approach. Legitimate Data Maturity is achieved as an organization makes its way along the continuum from realizing they have a challenge to defining, managing and ultimately optimizing their approach. Steps that can be used to create momentum and move the maturity dial include: Create a vision and strategy that aligns with the business vision for the best path forward Gain high-level business sponsorship and building strong stakeholder support. Identify metrics to communication standards for success and objectively measure progress Address data integrity across the information life cycle Define the organization and roles Enable the proper infrastructure Ensure the proper governance MOVING TOWARD THE PEAK OF DATA MATURITY Customer data best practices are now entering the slope of enlightenment on the Gartner Hype Cycle. The slope of enlightenment indicates that there are increasing opportunities to for technology to benefit the enterprise as it starts to become more widely adopted. Second- and third-generation products appear from technology providers and more enterprises fund pilots. The technology s value is no longer pure hype, but companies are actually recognizing financial benefits. The ultimate reward of taking these steps will be maximizing the value of existing marketing investments. Through implementation of data-inspired relationship marketing best practices, a company will trigger positive financial outcomes not only in marketing but in support, operations, finance and customer data management. IN SUMMARY As a result of our study it is clear that the best way for companies to grow their business is to enhance their Data Maturity. Utilizing high quality data and following best practices throughout all stages of the marketing-managed customer lifecycle will lead to sustainable Business-to-Business relationships. And it is those relationships that will drive company growth. ABOUT DUN & BRADSTREET Dun & Bradstreet (NYSE: DNB) grows the most valuable relationships in business. By uncovering truth and meaning from data, we connect customers with the prospects, suppliers, clients and partners that matter most, and have since Nearly ninety percent of the Fortune 500, and companies of every size around the world, rely on our data, insights and analytics. For more about Dun & Bradstreet, visit DNB.com. Dun & Bradstreet, Inc All rights reserved. (DB /15)