As President Obama celebrates his victory, he might look back on the myriad ways he used to reach potential voters, from traditional direct mail, phone solicitation, rallies and radio ads, to social networking, podcasts, and YouTube. In a long, hard-fought battle for the undecided voter, the communication vehicle can be just as important as what is said.
Political strategists, including those on the Obama team, used micro-targeting, the underpinning of predictive analytics technology, to gain competitive advantage by matching message and medium based on voter preferences. And more and more, savvy marketers are using this technology to translate customer knowledge into action in purchases, responses to an offer, or increased loyalty and satisfaction.
The new strategies and technologies of Election'08 focused on targeting the right voters at the right time. For instance, some high-value undecided voters were motivated to vote for a particular candidate by using predictive analytics to gain insight into that audience's interests?, and then communicating the right message to influence their actions. For marketers, the same strategy can be deployed in the battle to win customers.
Following are lessons marketers can learn from Election'08:
- Mine thy customer data-it's gold
Technological improvements have allowed micro-targeting to become the force that it is today-with higher processing speeds, the ability to digitally store and archive massive amounts of raw data, and the integration of multiple data islands, such as voter files, census data, and marketing database information.
This has set the stage to use the power of predictive analytics to search and discover new, meaningful patterns and relationships of strategic and tactical value. And, needs a different transition all types of data, from structured (transactional and demographic) to unstructured (blogs, wikis, call center notes). The intersection of these trends allows marketers to quickly and accurately harness their customer data to guide brand campaigns, select the right channels, and analyze promotions to improve marketing effectiveness.
It also gives marketers the ability to unlock the value of existing data to provide specific, real-time recommendations and maximize interactions, such as forecasting the response to a particular promotion so that store staffing and inventory levels are set appropriately.
- Focus on who-and who not-to target
Today's marketing budgets are as tight as political campaign funds. Predictive analytics is a technologically advanced way for campaigns, be they political or marketing, to target funds and resources toward the right voters or current and potential customers who will return the most value. Equally important, by identifying behaviors and attitudes, predictive analytics can identify the "least likely" voters or customers. Times and technologies have changed since Philadelphia retailer John Wannamaker (1838-1922) famously remarked: "Half the money I spend on advertising is wasted. The trouble is I don't know which half."
The use of predictive analytics provides marketers with a strategic weapon to focus on profitable revenue generation at every interaction. For example, targeted direct mail campaigns using predictive analytics have higher response rates because they target those who have the highest propensity to respond. Those with no chance of responding are excluded from the mailing.
In the recent political campaigns, predictive analytics significantly lowered the cost of consultant resources, from campaign personnel to the cost of mailings and other communications. Ken Strasma, president of Strategic Telemetry, a consultant to the Obama campaign, sees little difference between finding and targeting the most likely voter and uncovering and keeping your next best customer.
"When a technology lowers your costs and gives you a greater return, it just makes good strategic campaign and business sense to add it to your resources," Strasma says.
- Become intimate and listen to the customer if you want their vote
Today there is a stronger sensitivity to engage directly with voters to learn more about what shapes, influences, and impacts their decisions and intentions. Campaign strategists capture core data-demographic, behavioral, and attitudinal-and use this information to identify and communicate the right message on key voter issues, be it education, healthcare, or immigration, through targeted and personalized direct mailings, phone calls, or door-to-door canvassing.
Segmentation via predictive analytics is a way of grouping people-be they voters or customers-with similar demographic profiles, attitudes, purchasing patterns, buying behaviors, or other attributes to help organizations understand an individual constituent more thoroughly and market to them effectively.
The more information political organizations know about constituents most and least likely to vote, the more intimate and valuable constituent relationships become, and are more likely to generate the highest returns.
Similarly, marketers can identify customers who can be more easily persuaded to become their loyal patrons by using individual-specific data and then communicating on a one-to-one basis.
It's important to gain a clear, detailed understanding of what customers think and do, and what their future actions will be. Never getting to intimately know customers' attitudes-how they feel about the organization, products, or services-is being short sighted.
Predictive analytics uniquely enables organizations to integrate customer feedback data with transaction data and customer information. It puts attitude at the heart of the decision-making process to gain a more accurate and complete understanding of the customer.
- Real time data-driven decision making is essential in a fast-moving world.
Predictive analytics gives political organizations the ability to offer up real-time recommendations on how to connect to the right constituents based on current events, such as the economy, and it becomes fuel for driving future interactions to promote specific messaging related to the topic.
By deploying the results of predictive analytics to every customer touchpoint, from branch offices, to call centers, to the website, marketers can also achieve greater effectiveness and profitability, and improve the entire customer experience.
Build predictive analytics into a website, for instance, and visitors will be automatically presented with an offer most likely to result in a sale. Or incorporate into the call center, so sales representatives know what products or offers are most likely to suit a particular customer's needs.
So, when your next best customer is heading to the "polls" to make a decision on which product or service to buy, today's last-minute, down-to-the-wire decisions can be tipped to your benefit: You need only look to how the competition played out in Election'08. President Obama was able to anticipate the dialogue with constituents before his competitors could take over the conversation.
About the Author: Kris Hackney is Vice President of SPSS Worldwide Strategic Accounts and Services for SPSS Inc.