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1 AGENCY OVERVIEW 2011 MERKLE INC MERKLE MERKLEINC.COM Page 1
2 CUSTOMER RELATIONSHIP MARKETING AGENCY OVERVIEW Table of Contents Areas of Expertise 3 Greater Customer Insight Creates Marketing Opportunity 4 Merkle Services & Solutions 5 Strategic Consulting Leading With Strategy & Direction 6 Customer Relationship Marketing Services Creating Insight & Knowledge 7 Agency Services Changing Consumer Behavior 8 Our Work How It All Comes Together 10 Merkle Facts & Figures 11 Page 2 STRATEGY ANALYTICS TECHNOLOGY MEDIA CREATIVE
3 Merkle is a leading provider of fully integrated customer relationship marketing solutions that maximize results and demonstrate return on marketing investment. We provide the framework for organizations to apply quantitative marketing strategies to their marketing programs across mass, direct, and digital media. Areas of Expertise Strategic Consulting Leading with Strategy & Direction By aligning strategy with the goals and priorities of the business, Merkle is able to maximize new opportunities and deliver faster return on investment. Customer Management Strategy Segmentation Marketing Strategy & Planning Organizational Strategy Media Optimization Infrastructure Strategy Database Marketing Services Creating Insight & Knowledge Merkle achieves a comprehensive understanding of your customers by collecting, organizing, and optimizing both online and offline marketing data using a flexible and scalable technology platform. Database Development & Management Marketing Marketing Information Management Data Sourcing & Collection Marketing Technology Consulting Marketing Analytics & Business Intelligence Agency Services Changing Consumer Behavior Using insights about the audience, marketplace, products, and brand, we define situations and uncover new opportunities for marketers to develop targeted messages that deliver positive brand impressions and motivate response. Program Development Production Management Loyalty Programs Campaign Execution Creative Development Industry Expertise Merkle provides in-depth industry expertise in the following industries: Insurance & Wealth Management Banking & Finance Nonprofit Healthcare Retail Travel, Media & Entertainment CPG Plus Others 2011 MERKLE INC MERKLE MERKLEINC.COM Page 3
4 CUSTOMER RELATIONSHIP MARKETING AGENCY OVERVIEW Figure 1 Clients Greater Customer Insight Creates Marketing Opportunity The marketing landscape is evolving. Organizations are able to capture exponentially more information about their customers. Greater competitive advantage goes to the marketers willing (and able) to transform this data into marketing insight to create fully integrated customer marketing campaigns. Through customer optimization, marketers have the greatest opportunity to improve revenue growth, market share, and customer profitability. Combining a quantitative approach with the more traditional qualitative approach brings an overall balance to the marketing program. By integrating the two most critical functions of marketing customer and brand marketers gain clarity into customer motives and set the course for sustainable, long-term increases in financial performance. 1 Integrating brand and customer management strategies provides an opportunity for marketers to grow their competitive advantage through customer optimization. Database marketers have the expertise to leverage brand and consumer insight to inform marketing creative and program strategies, resulting in: Increased Brand Awareness Lower Cost/Responder Increased Market Share Improved Efficiency Increased Customer Value Return on Marketing Objectives Database marketers should play a larger and more strategic role within the marketing organization by expanding database marketing activities beyond media targeting and direct marketing. The capabilities required for market-leading database marketing can and should be applied across all areas of the enterprise that impact marketing performance to create fully integrated programs and campaigns. Merkle has these capabilities. Figure 2 Engagement Process Brand Focused Qualitative Big Ideas Attitudinal Brand Advertising Universal - Think Brand Strategic Integration Media Interactive Mass Direct Implementation Customer Focused Qualitative Facts Behavioral Precision Marketing Unique - Act Direct 1 Merkle, Measuring How Consumers Interact With Your Brand: Brand Engagement Monitor, August 2008 Page 4 STRATEGY ANALYTICS TECHNOLOGY MEDIA CREATIVE
5 Figure 3 Customer Relationship Marketing Evolution LEVEL LEVEL LEVEL light Campaign Focused Infrastructure focus, basic capabilities Product-focused programs, light modeling and targeting, often single channel execution, little customer customization Basic lifecycle frameworks and multi-channel/ touchpoint and execution, model integration, meda targeting and campaign automation Enterprise Engagement LEVEL LEVEL Customer Focused Business Unit / Media Engagement Advanced customer lifecycle strategies and contact/touchpoint management, channel and media targeting, enterprise segmentation and 4measurement, customer and household profitability 5 Focus is on customer value optimization, fully integrated programs, campaigns and customer experience Integrated Customer Experience Merkle Services & Solutions Our services and solutions are designed to develop fully integrated customer relationship marketing programs. We optimize customer behavior by balancing organizational constraints while maximizing predefined business objectives. Merkle s enterpriselevel strategy framework, flexible and scalable technology platform, and insight-driven agency capabilities provide the tools necessary to achieve outstanding results. Figure 4 Customer Relationship Marketing Agency Structure Strategic Consulting (Boardroom) Analytics & Insight Data Content Database Technology Creative & Messaging Production & Media (Lab) (Studio) (Factory) (Fuel) (Power Plant) 2011 MERKLE INC MERKLE MERKLEINC.COM Page 5
6 CUSTOMER RELATIONSHIP MARKETING AGENCY OVERVIEW Strategic Consulting Leading With Strategy & Direction Merkle s consulting approach uses a proprietary planning and implementation process that measures current marketing activity against industry best practices. Integrated Customer Marketing is an optimization framework that maximizes customer portfolio value through targeted management of customer interactions across marketing, sales, and service throughout the customer lifecycle. The ICM Framework enables companies to transition from campaign to customer lifetime value management, migrating the entire enterprise through an integrated customer journey (Figure 5). Drawing upon more than 20 years of knowledge, data, and experience working with top-tier marketing operations, Merkle examined the obstacles that have prevented organizations from implementing fully integrated, customer-centric marketing and the various intermediary approaches that have emerged over the past two decades. Surprisingly, one of the missing links is an organizational focus on the customer. Integrated Customer Marketing (ICM) was so named in recognition of its customer centricity. Figure 5 ICM TM Framework SALES INFLUENCE STRATEGY & PLANNING CHANGE MANAGEMENT TECHNOLOGY INFRASTRUCTURE DATA & ANALYTICS Customer Portfolio Optimization Lifecyle Management & Segmentation Customer Portfolio Optimization Lifecyle Management & Segmentation Customer Portfolio Optimization Lifecyle Management & Segmentation SERVICE INFLUENCE ICM is both a systematic pathway to integration and a business philosophy. It puts customers at the center of a company s business strategy in a way that trumps the old brand- and product-centric approaches. Merkle s proprietary ICM framework fully integrates the marketing function across the entire enterprise in a customer-centric fashion. When ICM is implemented, customers and companies win. ICM informs and integrates the total customer experience from strategic lifecycle management and marketing mix optimization to comprehensive program development and campaign execution. In traditional marketing operations models, business units are engaged in campaign-focused interactions that are driven by product objectives. In the ICM model, the enterprise engages in customer-focused interactions designed to heighten and maximize customer experience and lifetime value through a series of well-defined and properly executed campaigns. ICM strives to integrate the customer experience by shifting the organization s orientation to the customer. Designed to overcome organizational, operational, and technological constraints that typically hinder organizations from maximizing value, the ICM framework incorporates strategy and planning, change management, technology infrastructure, and data and analytics. Enterprise segmentation and enterprise measurement frame four major areas of integration, each of which is implemented as a gradual, planned journey via a clearly defined, multi-step process. Page 6 STRATEGY ANALYTICS TECHNOLOGY MEDIA CREATIVE
7 Customer Relationship Marketing Services Creating Insight & Knowledge Marketing Information Management Merkle achieves a comprehensive understanding of its customers by collecting, organizing, and optimizing online and offline data. Our marketing technologies support the execution of database marketing strategy, analysis, and implementation giving marketers significant improvements in time to market, knowledge expansion, and program profitability. Database Marketing Technology, primarily in the form of database marketing infrastructure, is a critical component of quantitative marketing. The Merkle Knowledge Center is a flexible and scaleable marketing platform designed to support the entire realm of quantitative marketing. Marketing 2 Merkle Knowledg , an integrated suite of products supported by custom development and integration services, provides campaign management, deliverability, and content management capabilities. When combined with our Merkle Knowledge Center database marketing platform, marketers have the ability to deploy multi-touch, interactive campaigns that integrate , direct mail, RSS, subscription centers, micro-sites, and telemarketing into a seamless communication stream driven by consumer preferences and behaviors. Content Solutions 3 A core component of integrated marketing is the ability to understand customers throughout their lifecycle. This understanding allows a marketer to react to and change customer behavior. Customer knowledge from acquisition and through the balance of the customer lifecycle has to be supported by a great data content strategy. Merkle s Content Solutions develop customized data content strategies that support integrated marketing and customer lifecycle management. Content Management Content is the number one enabler of database marketing. Content Management provides marketers with the ability to access all available data, evaluate this data on its marketing value, and integrate only the data that has proven value. This process of accessing and evaluating data to integrate content is an essential step in accomplishing direct marketing objectives. Marketers using the right content management strategy enrich each activity and ensure better results for each program and a higher overall ROI. Quantitative Solutions Merkle s ability to translate data into actionable marketing opportunities is at the heart of our fully integrated customer marketing services. Merkle helps marketers achieve a direct, measurable impact on their bottom line by employing quantitative database marketing solutions such as predictive modeling, enterprise segmentation, media mix optimization, and customer lifecycle analysis. Our solutions are custom-built and centered on driving marketing performance and results. By applying advanced analytical techniques to today s business problems, marketers will yield improved results. 2 Merkle, A View From the In-Box 2008: Actionable Information For Marketers From The Annual Consumer Study, April Merkle, Optimizing Data Content to Improve Marketing Performance, May MERKLE INC MERKLE MERKLEINC.COM Page 7
8 CUSTOMER RELATIONSHIP MARKETING AGENCY OVERVIEW Figure 6 A sampling of Quantitative Solutions: Predictive Modeling Segmentation Contact Strategy Response Models Customer Segmentation Media Mix Strategy Conversion Models Prospect Segmentation Optimal Contact Frequency Prospect LTV Models Market Segmentation Sequence and Recovery Customer Churn Model Channel/Media Segmentation Offer/Creative Arbitration Re-purchase Model Customer/Prospect Profiling Channel Preference Agency Services Changing Consumer Behavior Acquiring, retaining, and maximizing profitable customers is more challenging than ever before. Connecting with consumer s motivations, beliefs, and desires has trumped traditional offer-focused communication programs. Unlocking those insights and creating relevant and timely reasons for the consumer to engage is the key to customer optimization at every stage of their lifecycle. Merkle s Agency Services help marketers overcome these challenges by developing fully integrated customer marketing programs that manage every aspect of the customer lifecycle from awareness to acquisition, on boarding to loyalty. Creative Merkle s Agency Services doesn t just start with the creative changing the graphics and copy alone rarely delivers the best results. Merkle informs the message and media with rich consumer insights to identify the behavior changing messages consumer respond to. We partner with marketers early on in the creative process to ensure we provide more concepts with greater range of creativity and then work together to refine the best solutions. As a result, we combat parity in the marketplace and clutter in the media with messages that are both on target and able to change consumer behavior. Increasing Acquisition Performance for GMAC Insurance Merkle analytic insights and a creative audit of existing direct mail kits found opportunities for messaging and design improvement over previous controls. Key Takeaway Our first creative effort beat the long-standing control within the first few weeks of response analysis. Improving Customer Engagement Through for DirecTV DirecTV needed a solution to deliver content relevant to customer preferences and behaviors. They also wanted to optimize the frequency of their communications. Merkle increased consumer relevance in fewer customer contacts by consolidating seven newsletter products into one dynamic product. Dynamic content modules targeted appropriate segments with relevant content. Realized significant improvement in key metrics (opens, click throughs, etc.). Page 8 STRATEGY ANALYTICS TECHNOLOGY MEDIA CREATIVE
9 Production Management & Consulting Merkle offers full-service direct mail production execution. We manage over 1 Billion pieces of mail a year within 750 distinct campaign cycles with a quality index of 99.94% (mailed errors/total mailed). Our team routinely reviews direct mail packages, processes, pricing, and planning to provide recommendations that are often worth millions in hard dollar savings. Our logistics program and postal expertise further deliver value for marketers as part of our complete, programmatic solution from idea to delivery. Figure 7 Areas boxed in orange change based on the subscriber history Execution Even the best strategy is rendered meaningless with poor execution. The execution of successful marketing campaigns is a strategy unto itself. Merkle s launch times are measured in weeks versus months. Our ability to seamlessly interact with other agencies, internal groups, and existing suppliers ensures the informed execution practice necessary for fully integrated marketing programs. It sounds simple but it isn t. Programs driven by data and insight acknowledge, react to, and, ultimately modify consumer behavior, integrating all of the above competencies to form a sound strategy. The resulting program paired with flawless execution delivers a measurable and meaningful impact on your business. This is the fulfillment of integrated customer marketing MERKLE INC MERKLE MERKLEINC.COM Page 9
10 CUSTOMER RELATIONSHIP MARKETING AGENCY OVERVIEW Our Work How it All Comes Together Merkle improves marketing results by focusing on areas that impact marketing performance Merkle is a leader in helping marketers develop fully integrated customer relationship marketing programs. We help marketers expand prospect universes by up to 30%, reduce cost per responder by up to 50%, improve customer retention by up to 25%, and reduce time to market by up to 50%. Our highly-skilled professionals and state-of-the-art marketing systems give Merkle the expertise to leverage brand and consumer insight to inform customer optimization strategies. We are dedicated to three imperatives of strategic database marketing: 1. Balance the qualitative, mass approach to marketing with an equal energy and discipline based on a more targeted, quantitative approach. 2. Integration of strategic consulting, business intelligence and analytics, data sourcing, database development and management, and creative and production management services. 3. Results that deliver significant increases in time to market, knowledge expansion, overall profitability and demonstrate a measurable return on marketing investment. Our philosophy at Merkle is simple: We work with top marketers to collaboratively develop effective solutions to improve their bottom line. Figure 8 Our Work Our Deep Understanding of Database Marketing Drives Highly Disciplined Approach That Fuels Our Ability to Deploy Better Solutions That Enable Impactful Marketing Strategy Improved Marketing Results Page 10 STRATEGY ANALYTICS TECHNOLOGY MEDIA CREATIVE
11 Merkle Facts & Figures We help world-class organizations use information more effectively across their entire marketing enterprise to maximize financial performance and return on marketing investment. The core of our solution is our highly flexible and scalable marketing technology platform coupled with award-winning analytics and creative, and driven by our highly-disciplined consultative approach. It is the integration of these competencies that creates superior results for our marketers. Company Profile: Chairman & CEO: David Williams Founded: 1971 Ownership: Privately held Revenue: $254 million for 2010 Locations: Baltimore Boston Chicago Denver Little Rock Minneapolis New Jersey New York Philadelphia Pittsburgh Seattle Shanghai Employees: 1,500 Our Customers: 150+ World-class Clients Industries served include: Financial Services; Multi-Channel Retail; Insurance; Retail Banking; Credit Card; Nonprofit Fundraising; Consumer Package Goods; Pharmaceutical; High-Tech and Telecommunications; B2B; Travel, Media and Entertainment Our Capabilities: Manage over 75 marketing databases Manage several billion direct mail pieces annually Send over 1 billion permission-based s annually Inform over $5 billion marketing decisions annually Figure 9 Awards & Recognition The Time is Now In today s competitive environment, it s not enough to provide great products and services. A fully integrated customer marketing program provides an opportunity for marketers to grow their competitive advantage. Merkle has the expertise to leverage brand and consumer insight to inform marketing creative and program strategies MERKLE INC MERKLE MERKLEINC.COM Page 11
12 CUSTOMER RELATIONSHIP MARKETING AGENCY OVERVIEW JOIN IN THE CONVERSATION linkedin.com/company/merkle facebook.com/merkleinc twitter.com/merklecrm flickr.com/photos/merklecrm youtube.com/user/merklecrm 8/2011 Page 12 STRATEGY ANALYTICS TECHNOLOGY MEDIA CREATIVE
AGENCY OVERVIEW 2011 MERKLE INC. 1.877.9MERKLE MERKLEINC.COM. Page 1
AGENCY OVERVIEW 2011 MERKLE INC. 1.877.9MERKLE MERKLEINC.COM Page 1 CUSTOMER RELATIONSHIP MARKETING AGENCY OVERVIEW Table of Contents Areas of Expertise 3 Developing Customer Strategy as a Business Strategy
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