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BDMs Eager for Tools to Boost Customer Retention Retaining existing customers is the fastest and most profitable way of growing revenues, a top priority of business decision makers (BDMs) this year. However, most senior managers don't realize that your business intelligence (BI) software—and especially analytics applications—are the best tools to improve customer retention, according to a survey by BusinessWeek Research Services earlier this year. While operational efficiency remains the highest priority business initiative, according to the 200 directors, VPs and other senior managers polled by BWRS, retaining customers is a close second and a far higher priority than forecasting or profitability analyses. As the table below shows, 73 percent of the respondents said that customer retention was a high-priority business initiative this year.
Source: BusinessWeek Research Services, 2005 survey of 200 senior managers with business intelligence related responsibilities But they don't realize that BI tools, especially predictive analytics, can help them retain customers. Analytics tools that predict customer behavior based on current transaction and other data are the business intelligence industry's big secret amidst a boom in analytic applications sales (IDC predicts the $4.2 billion market will have the fastest growth rate—11 percent—of any BI sector through 2008). As the following table shows, most respondents are aware of the use of BI tools to analyze marketing campaigns and financials. But only 23 percent indicated that business intelligence is best suited to retaining customers. Note that these are BI-savvy business managers, so the overall recognition of the value of business intelligence for customer retention is probably lower.
Source: BusinessWeek Research Services, 2005 survey of 200 senior managers with business intelligence related responsibilities What an opportunity! The myriad of new product announcements made by BI vendors about their analytics during the past few years, especially their predictive analytics tools, have not been followed up by enough explanation about the value of these tools. Yes, I know that many of your customers have been reluctant to be profiled about their use of analytics because of the strategic nature of the applications. But I've heard of enough examples that it's time to broadcast the message about what analytics can do. Here's the Pitch Our sections on Business Intelligence have been among the most popular and successful in BusinessWeek, so the earlier you participate, the better your placement. Give me a call or send me an e-mail if you have any questions or would like to see the brochure about the section. Legal Stuff For prior issues of my newsletters with research data and analysis, visit this page of our Web site. If you want to be removed from my e-mail distribution list, please reply to this e-mail with the word Remove in the subject line. Thanks again for your interest and support.
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