Customer Centric MDM is a big challenge for most organisations, its also one with possibly the biggest opportunity for revenue generation in a company. But does this upside mean increasing costs, and in particular increasing operating costs? The answer is thankfully no. As we discussed with IBM in our recent paper Know your customer, understand your business there are lots of opportunities to actually reduce costs as well as increase revenue.
The first advantage for a strong Customer Centric MDM strategy and implementation is to actually have a marketing budget that works effectively and doesn’t duplicate effort.
- Market only new products to customer – know that they already have multiple products
- Market only once to a customer – no duplicate records means no duplicate costs
- Increase conversion rates and decrease cannibalisation
All of these elements actually improve the top line while reducing the operating expense required to do so. As an example if you are doing a direct marketing campaign to four hundred thousand clients and in reality there are only three hundred thousand and 20% of those already have that product from you then you not only increase your conversion rates, by targeting actual customers who might want to buy, but also decrease the costs required by mailing only two hundred and forty thousand potentials which represents a near 50% cost saving.
This is the only place where MDM helps reduce customer related costs. In the call centre having an MDM solution means being able to provide a single call centre across multiple products and offer joined up support. From a revenue generation perspective this helps upsell but it does so by enabling a reduction in the amount of complexity in the call centre and thus a reduction in the number of staff required.
Customer Centric MDM is therefore about driving top-line growth while delivering operational savings. There aren’t many initiatives that can aim to deliver both cost savings and new revenue streams.