SAS understands the importance of client retention to fuel growth of companies in Puerto Rico
SAN JUAN, PUERTO RICO (Aug. 30, 2005) – The acquisition and retention of loyal clients have become primary goals of top managers, according to a March 2004 study by Forbes and Gartner Group.
For any typical company, the retention of profitable clients represents the potential for revenue and profit growth and the opportunity for future expansions. �The lack of retention strategies can become the main reason why earnings are diminishing for many companies,� said Edward McDonald, marketing automation specialist of SAS, the leader in business intelligence solutions. �Depending on your business model, losing loyal clients can have serious ramifications if we take into account that attracting a new client can cost up to 5 to ten times more than retaining an existing client, according to figures published in an article by the Harvard Business Review.�
To meet this challenge, SAS has developed a series of customer intelligence solutions, including SAS� Marketing Automation, SAS Interaction Management and SAS Marketing Optimization. SAS recognizes that marketers need to gain a profound understanding of the client life cycle through a methodological and precise analysis of profitable customer segments so they can design more focused and, therefore, more effective marketing strategies. To do so, marketers need to perform real time-analysis of clients� behavior over extended periods of time to determine typical conduct and when to react to retain customers before they leave.
“If we consider that retaining 5 percent of existing clients can result in an increase of up to 75 percent in revenues , the importance of implementing CRM strategies and the substantial benefits this type of investment can bring becomes very clear,� said McDonald.
However, many CRM implementations fall short of reaping the maximum benefits. A study published by META Group, a division of U.S.-based research company Gartner Group, estimates that �75 percent of the CRM initiatives will fail due to lack of business vision and clear business goals.�
According to McDonald, in many cases this failure is a result of a lack of clear objectives and well-defined monitoring and evaluation systems to measure the effectiveness of marketing strategies. �Crucial to the successful management of CRM strategies is the capacity to synchronize and centralize marketing strategies and customer data collection in a single system. This consolidation of data will provide a more holistic view of the client throughout the entire life cycle of the relationship with the company and how to proactively react to behavior changes.�
SAS experts realize that is important to understand how to manage a customer life cycle and how doing so brings revenues to the company. This knowledge includes understanding how marketing strategies are managed and determining how effective they really are in retaining profitable clients.
�Part of the solution relies on the creation of customer profiles that help identify the more profitable clients in order to create multichannel communication strategies that anticipate the needs of these clients and how the company can respond to satisfy those needs,� said McDonald. �This means that a company should gather the data that holds key customer information on a regular basis into a system capable of providing useful business intelligence to support a decision on how to manage a customer life cycle.�
Recently, IDC recognized SAS as the revenue leader in marketing automation software for the third consecutive year. The most recent IDC study (�Worldwide Marketing and Sales Automation Applications 2004 Vendor Shares: A Rising Tide,� IDC #33661, July 2005) examines the marketing and sales automation applications market for 2002-2004. The study lists SAS� marketing automation revenue at $149.1 million, or 9.1 percent of market share.
The IDC report defines marketing automation as software applications that automate a wide range of individual and collaborative activities associated with the various dimensions of the marketing process.
These dimensions include the following: ad management/placement, lead qualification/distribution, brand management, list management, campaign execution, marketing resource management, campaign planning and management, media and analyst relations, collateral management/distribution, personalization, database marketing, primary research, direct marketing, reactivation, electronic catalog, up-sell and cross-sell programs, event/trade show management, Web activity analysis, focus groups/media testing, Web advertising, and fulfillment status linkage.
1 Excerpt from Loyalty Rules by Fred Reichheld.
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