The Marketing Book 5th Edition

Data

warehouse Buying

Marketing

Sales

Accounts

/CredStocikt controcontroll Distribution

Customer

service

What are direct marketing and interactive marketing? 581

Because some of these functions were seen
as completely separate in many large busi-
nesses, and may have become computerized at
different times, their systems are unlikely to be
fully compatible. They will certainly not be
compatible with e-commerce systems. Old sys-
tems are referred to as legacysystems.
However, if essential details, such as file
formats, are harmonized, it is possible to store
data that would otherwise simply be archived
in a data warehouse. Now, the data can be
processed in such a way that they can be
analysed by a competent person, using a PC.
The process of retrieving data for analysis
from a data warehouse is called data mining.
Data mining is often used in businesses with
masses of transactional data, such as banks and
airlines.
The idea of the data warehouse is to bring
systems together to form an enterprise-wide
management information system. In theory, at
least, this permits a customer relationship
management (CRM) system to be employed.
The idea behind CRM is that the whole of a
customer’s dealings with the company can be
put together. Such systems are devised by
outside software vendors and may need exten-
sive adaptation.

The whole customer

As well as having a current account and a savings

account, a bank customer may deal with the

home loan division, the life and general insur-

ance divisions, the credit card division, and the

personal investment management division. Since

the average customer holds only 1.2 accounts,

such a customer would be very valuable to the

bank. Yet, before the creation of an enterprise-

wide CRM system, the bank would not have

recognized all of these different relationships as

being with the same customer.

In practice, company divisions or departments
(including marketing) may find their needs
better served by data marts. These are fed by

the data warehouse, but contain only informa-

tion that is relevant to the departmental interest

and are designed to make the data easier to

interrogate and analyse.

Integrating e-CRM

When the company’s front office is a website,

the volume of data being collected, processed

and managed is very large. Some data, e.g.

DNS (domain name system) and clickstream

data, are peculiar to interactive marketing. The

latter, particularly, can overwhelm a system

unless it is summarized. It is not necessary to

keep this information for individual customers

as long as customer preferences, either declared

or implicit through transactional behaviour, are

recorded.

When human interaction is by e-mail or chat,

there is a full, self-generated digital record of

the contact – unlike a phone call or field sales

visit. This record may be used to auto-generate

e-marketing contacts.

Figure 22.6 The data warehouse