The drive to deliver a single customer view

Hanging on a wall in the office of Simon Kaffel, the data and analysis director of marketing strategy at BSkyB, is a huge and complex diagram, which has an idiosyncrasy to it only disciples of marketing are likely to begin to grasp. “It is a map of whereabouts data is in our operation and contains all the sources of information in the data warehouse,” says Kaffel. It is said only two people really understand the map and Kaffel admits it gives him nightmares.

There is also a critical point about the way the diagram has been drawn – it is not centred on the customer. For that, Sky pulls data from the data warehouse into its Olive system, managed by SkyIQ, to create a single customer view (SCV). “We don’t have to touch the data warehouse itself,” notes Kaffel.

What this approach underlines is the distinction between having data on the customer and having a view of the customer. For years, organisations have pursued the goal of pulling every instance of customer data into a single place to provide a 360-degree view. Sky has tackled that by pulling information out of a very diverse range of sources into a separate system, rather than trying to build the integrated view in its operational data warehouse.

Kaffel emphasises that neither the sources nor the SCV are static. “It is evolving month to month. It is down to the business to decide how to leverage as much as it can out of the data asset. The technology needed to do that has moved on,” he says.

Far more complex
The operational data warehouse was originally built at the start of the last decade. “Ten years in data management technology is a lifetime,” he says. “The amount of data you are able to process, the complexity of extraction, transformation and loading processes and the data itself are all far more complex now.”

As a business, Sky has also moved on – ten years ago it did not offer gambling, for example – so the needs and sources of data continue to expand. Collating that information to provide each business function with the data required is the very heart of what Kaffel’s team does. It has also helped to drive the media company’s success.

The pragmatist in me says not all data is created equal

“We’re not standing still. It is not as if the single customer view is set in stone and cannot change. We are constantly moving data in, building models and trying to meet the demands of a business that is changing all the time,” he says.

When it comes to getting a view of the customer and what makes them valuable, you need to look at everything available. No single item of data stands alone – the combination is what gives it power.

“I do believe in bringing in as much information as possible to the system,” says James Morgan, head of the customer intelligence centre (CIC) at O2. Even so, this is subject to limits based on business rules. “Some of the data, such as users of smaller gaming apps, may only be on a few hundred customers. Building links to those third parties, getting legal agreements, running data transfers would have a cost that is not warranted. We do have to draw a line at some point.”

Bigger vs value
The opposite side of that argument is where very large data sets exist that require significant processing power, but where the value to the business is not necessarily clear. “We have to be careful about trying to put anything into the data warehouse where the value is not there. We can’t know the value of every bit of information, so we have to have guidelines,” he says.

CIC has to balance the role it has in enabling business ideas by providing accurate data with its other function as gatekeeper to the data and cost setter. A clear change management process exists that is followed when a new data feed has to be created.

“We cost up proposals and may say, ’do you really want to spend this on a new data feed, or do you just want to know who has got a particular product?’,” says Morgan. New product launches are a classic example of where the existing single view of the customer is likely to be stretched and careful management is required.

Morgan says a phased approach is often the most effective. On day one, what the line of business needs to know is which customers have bought a product and whether they are active. In a highly dynamic and innovative sector such as telecoms, there are high numbers of product launches, not all of which are successful in the long term. By limiting the initial management information provided, costs are also constrained.

If a product establishes itself, a much stronger business case can be made to establish this data as a permanent part of the SCV.

What this approach underlines is the distinction between having data on the customer and having a view of the customer

“The risk is to over-invest in something you don’t know will take off. It is also possible to get a product to market without any information, but if you do that, you have to be certain that the risk premium is small,” says Morgan. For an organisation that is oriented around customer-centred decision making, that would be an exception, rather than a rule.

Variables
The concept of value-driven data integration has grown in stature. Data managers have always resisted the pressure to simply keep adding variables to a database, but it has often been a struggle to explain why. By putting an onus onto the business function to prove that value will be returned, a greater degree of precision and purpose is brought to bear on the SCV.

With data volumes rising dramatically, filtering requests in this way is becoming an ever more important part of the task. Asked about whether this value can always be demonstrated, Stephen Boyle, database marketing manager at Reader’s Digest, answers, “the data analyst in me says yes. But the pragmatist says that not all data is created equal and it can be hard to justify being integrated across all data sources.”

He says the critical step is to identify which data items are fundamental for the effective management of a business process. “The key point is to make judgements on how that data can work across different channels. That, of course, is easy to say, but harder in practice,” says Boyle.

Multichannel marketing’s relentless expansion of its touchpoints is undoubtedly putting pressure on existing templates for single views of the customer. Whether the SCV can be adapted to include new data from these will depend on a range of factors, such as the underlying data model, the matching points available in new data to allow it to be integrated to a customer file, or the completeness of the information.

Stewart Robbins, head of customer insight at E.on Energy, says: “Personally, I think you have to make decisions about what variables to include. For example, if you were a mobile network looking at the number of calls a customer had received, that is in the operational data, but to pull a list of all of them into the SCV won’t support your marketing activity in the right way.”

Aggregation
Aggregating that data into a code or flag showing if that call activity has declined or risen in a given period immediately transforms this data into useful insight and avoids overloading the marketing database.

“Processing power does cost money, but you could decide as a marketing-led organisation that the SCV is worth investing in if it drives revenue,” he notes.

Political issues also need to be borne in mind when specifying the scope of an SCV. Marketers have always struggled with the issue of who “owns” a data item they might want to include in a customer database. Where the company operates in a network or matrix model, this extends the problem.

“Our business partners want to know what we are doing with their data,” says a senior marketer with one financial services provider. “In some countries, such as France and Spain, we could do anything we want to, whereas in others, such as the UK, Germany or Sweden, they certainly want to know exactly what data we are taking and what is being done with it.”

Customer relationships
His company provides products on a white-label basis through a wide range of business partners and affiliates. It then manages customer relationships and cross-sell activity.

“That can make it complicated to decide the ROI when you go to a partner and say you want to include some information in the marketing database,” the marketer notes.

Single view of the customer is a vision, more than a reality. But it is now possible to get something very close to the ideal, provided the right decisions are made. All it takes is a combination of careful planning and belief.