predictive marketing

34
© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential. #AdobeSummit #Measure © 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential. #AdobeSummit Predictive Marketing: No PhD in Statistics Required! Katrine Kieldsen | Senior Consultant, Adobe Consulting | @kkieldsen John Bates | Product Manager – Predictive Marketing Solutions, Adobe Systems | @johnbbates Bill Gassman | Research Director, Gartner | @bgassman #Measure

Upload: kkieldsen

Post on 15-Jan-2015

1.719 views

Category:

Business


0 download

DESCRIPTION

Predictive marketing: No PhD in statistics required! How do you provide the right content to the right customer at the right time through the right channel? How can you make more confident decisions from your data and become forward looking without having to be a “quant”? Hear how you can simplify predictive marketing solutions and techniques to enhance data analysis and make more intelligent decisions based on statistical modelling. Learn about: Segmentation and customer response scoring. Forecasting. Attribution and media mix modelling. This session is for interactive marketers and web and business analysts in all industries. Level: Advanced Speakers: Bill Gassman, Research Director, Gartner Katrine Kieldsen, Senior Consultant, Adobe John Bates, Product Manager - Predictive Analytics, Adobe

TRANSCRIPT

Page 1: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#Measure

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummitPredictive Marketing: No PhD in Statistics Required!Katrine Kieldsen | Senior Consultant, Adobe Consulting | @kkieldsenJohn Bates | Product Manager – Predictive Marketing Solutions, Adobe Systems | @johnbbatesBill Gassman | Research Director, Gartner | @bgassman #Measure

Page 2: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#Measure

2

Katrine KieldsenSenior Consultant, Adobe ConsultingAdobe Systems Inc.

John BatesProduct Manager - Predictive Marketing SolutionsAdobe Systems Inc.

Bill GassmanResearch DirectorGartner Inc.

Page 3: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasureToday’s agenda

3

1. Adobe’s predictive marketing strategy

2. What is predictive marketing, really?

3. Adobe’s product roadmap – predictive marketing solutions

4. Product association & segmentation

5. Customer retention modeling

6. Forecasting & marketing budget allocation

7. An industry analyst’s point of view

Page 4: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasureYou can change your future

4

"Any company can generate simple descriptive statistics about aspects of its business … but analytics competitors … use predictive modeling to identify the most profitable customers - plus those with the greatest profit potential [and then these companies act]…."

- Thomas Davenport, Competing on Analytics, Harvard Business Review

Eliminate the guesswork in marketingRather than reactive approach, take a proactive approach to optimisation

Page 5: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasureSoccernomics: applying moneyball in football

5

Despite the relatively nascent state of predictive analytics in football, clubs like AC Milan have successfully implemented it to predict player injuries

“The problem we're trying to solve is that there are rich teams and there are poor teams, then there's fifty feet of crap, and then there's us. It's an unfair game.”

– Billy Beane (Brad Pitt), Moneyball

#AdobeSummit

#Measure

Page 6: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#Measure

#AdobeSummitWhen “Moneyball” collides with digital marketing

Within your industry (or even within your own organisation),

there are competing marketing budgets and fierce competition

6

“There is an epidemic failure within the game to understand what is really happening and this leads people who run major league baseball teams to misjudge their players and mismanage their teams.”

– Peter Brand (Jonah Hill), Moneyball

#Measure

Page 7: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#Measure

#AdobeSummitWhen “Moneyball” collides with digital marketing

Within your industry (or even within your own organisation),

there are competing marketing budgets and fierce competition

7

– John Bates, Adobe Systems

#Measure

Page 8: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasureAdobe & the Digital Marketing Suite – leading predictive marketing

8

supply chain

operation

security intelligence

sales and CRM

marketing

data mining

general statistics

predictive mining

real estate/facility management

insurance/ investment/wealth management

While predictive analytics can be applied to many different fields, Adobe is the industry leader in the application of predictive analytics to digital marketing

Predictivemarketing

Empowerdigital marketerswith intelligent,forward-looking

decisions

Predictive analytics

Page 9: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasureWhat is predictive marketing, really?

9

Marketing

Data mining

Predictive analytics

Descriptive analytics

Page 10: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasureMoving beyond techniques towards solutions

10

Sequence discovery

Customer identification

Customer attraction

Customer retention

Customer development

Segmentation & clusteringFraud detectionRecommendations

Propensity scoringPersonalisation1:1 marketing

Marketing mix modelingPricing optimisationSocial/mobile performance

Content creation scoringContent half-life decayCommunity reaction

Predictivemarketing

Page 11: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasureBenefits of Adobe’s predictive marketing solution

11

Predictive marketing provides value to everyone from analysts to technology experts to web content managers in all industries

Digital Marketer Challenges Solved with Predictive MarketingAdvertiser Which audience variables are most predictive of increasing CTR?

Publisher How much advertising inventory is forecasted for next week?

Web experience manager How long should a new article be on the homepage?

Analyst Which customer website actions are most predictive of conversion?

Technology expert Which variables should be tracked for future predictive modeling?

Social media manager What is the forecasted sentiment of a specific Twitter post?

CRM manager Which customers are most likely to respond to a cross-sell offer?

Industries:Retail

Media

Travel & hospitality

Telecommunications

Manufacturing

Finance

Technology

Consumer goods

Page 12: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasureValuable predictive marketing solutions

12

Predictive marketing & data mining for marketers, publishers and merchandisers

Empower digital marketers with intelligent, forward-looking decisions

Marketing segment

identification

Customer response scoring

Social performance forecasting

Anomaly detection & correlation

Marketing mix

modeling

Page 13: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#Measure

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

Predictive Marketing: No PhD in Statistics Required!Katrine Kieldsen | Senior Consultant, Adobe Consulting | @kkieldsen #AdobeSummit

#Measure

Page 14: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasureProduct association & segmentation

14

Is your daughter pregnant?- ask TARGET!

Page 15: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasureProduct association & segmentation

15

Habits control half of the life of your prospects

Timing is everything

Segment: pregnant woman

Pregnancy prediction score

Page 16: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasureProduct association & segmentation

Don’t get creepy – Get sneaky

16

Page 17: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasureCustomer retention modeling

17

Focu$ on retention

Page 18: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasureCustomer retention modeling

18

RETAIN$

NEW$$$$ - $$$$$$$$$$

Indicatorsunsubscribe newsletter

close bank account terminate insurance

no purchase in 3 months.... etc .....

Page 19: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasureCustomer retention modeling

19

Retain$

x y z

Warning

Page 20: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasureForecasting & marketing budget allocation

20

This will happen...

Page 21: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasureForecasting & marketing budget allocation

21

Back-testing of model shows 98.9% accuracy

Weeks before Black Friday / Cyber Monday the model forecasts a 20% decline in year-over-year traffic

ARIMA forcasting model

Page 22: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasureForecasting & marketing budget allocation

22

Statistically optimised spend

Email

Affiliates

SocialSEM

Display Email

Affiliates

SocialDisplay

SEM

Page 23: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#Measure

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

Predictive Marketing: No PhD in Statistics Required!Bill Gassman | Gartner Industry Analyst | @bgassman | #AdobeSummit

#Measure

Page 24: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasurePredictive analytics: know the power and the limits

If past history was all there was to the game, the richest people would be librarians.

— Warren Buffett; Investor

It’s far better to foresee even without certainty than not to foresee at all.

— Henri Poincare; Mathematician, Philosopher

It ain’t what you don’t know that gets you in trouble; its what you know for sure that ain’t so.

— Mark Twain; Author

Page 25: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasureDigital marketing is standing on the shoulder of giants

25

Page 26: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasureGrowing Business Complexity Requires More Scalable Analytics

Page 27: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasureWhat can predictive analytics tell you?

Customer IDAttitude to privacy

Channel preference

Needs and wants

Price sensitivity

Location

Purchases

Channel

Payment

Date and time

Timing preference

Brand loyalty

Page 28: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasureMore data = better predictions

Social

Search+

Dataaggregators

+

Location+

Call center+

Clickstream+

=

Score

Page 29: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasureThe modeling complexity spectrum

Packaged analysis

Data miningworkbenches

RapidAccurate

AutomatedRigorous

Pre-definedFlexible

Automated

SeamlessFlexible

PredeterminedExtensive

Subtle

Modeling

Data preparation

Problem understanding

Evaluation of results

Deployment

Data understanding

Page 30: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasureAction to outcome: validating the models

Did the customer opt out?

Did the customer receive the offer?

Tactic-based

What did the customer do?

Was there a conversion?

Objective-based

Goal-based

What is the customerdoing six months later?

What was the impact

on the customer's value?

Did we make forecast?Do audience segments act as predicted?What if we test the minority report?Which model works best for which segment?

Page 31: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasureStages of analytics maturity

What should I do?What will happen?What happened and why?

DecisionsInformation

Descriptive & diagnostic analytics

Predictive analytics Prescriptive analytics

Insights

For example

• Who are my most valuable customers?

• Why is my attrition rate so high?

• Which customers are most likely to respond to my next offer?

• Which offer should I make to each customer?

• What if…?

Page 32: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasureContext-aware marketing

Suggestion

Proactive

Real-time

Multichannel

Hyperpersonalised

Social, intent-driven

Informed consent

Ensemble interactions

Federated content providers

By 2015, context will be as influential to consumer services and relationships as search engines are to the Web

Organisations

Providers

Users

Page 33: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#MeasureIn closing

33

1. You can change your future by using forecasts to be proactive

2. Technology is useful across many roles

3. Detect anomalies, identify market segments, score visitor response, forecast social performance, model marketing mix

4. Timing is everything: don’t get creepy, get sneaky

5. Know the power – and the limits (trust but verify)

6. Packaged predictive analysis solutions trade scope for accessibility and relevance

7. The value of predictions is in the action taken. Mix forecast with context to increase relevance

8. Adobe offers predictive marketing in its Digital Marketing Suite

Page 34: Predictive Marketing

© 2012 Adobe Systems Incorporated. All Rights Reserved. Adobe Confidential.

#AdobeSummit

#Measure

Obtain additional resources at:www.CMO.com

Follow us: Facebook.com/AdobeDigMktg or @AdobeDigMktg

Thank [email protected]@[email protected]