IBM Introduces Business Intelligence Software To Manage Complex Marketing Campaigns

Sumitomo Trust & Banking Co. Ltd. Improves Response Rate More Than 5 Fold

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SOMERS, N.Y - 01 Mar 2000: -- IBM today announced leading-edge software that enables companies to plan, execute, track and refine marketing campaigns, thus moving a company closer to "one-to-one" marketing -- considered by analysts to be a key differentiator in the new millennium.

IBM DecisionEdge for Campaign Management allows marketing executives at Sumitomo Trust and Banking Company, Ltd. for the first time to establish meaningful "dialogues" with their customers by pre-planning and managing multi-step, multi-channel marketing campaigns. Automating the capture and reporting process gives marketers greater insight into what makes a marketing campaign successful because it builds on the history of all contacts a company has with a customer.

"Companies, such as IBM, who have advanced capabilities in the areas of multi-step campaigns and capacity management, are well positioned for establishing meaningful interactions that promote loyalty and improve customer profitability," said Aaron Zornes, executive vice president and director for META Group's Application Delivery Strategies.

Based on customer responses and overall demographics and behaviors, marketers can then personalize the communication, ensure consistency and improve customer service. Through this "dialogue," companies can develop more loyal relationships, which ultimately result in more profitable customers.

"In an e-business, everyone works for marketing," said Ben Barnes, general manager, IBM Global Business Intelligence Solutions. "Today's economy is a `buyer's market.' To be successful, companies need to focus on the customer above all. Customers want rich relationships."

DecisionEdge for Campaign Management is a critical component of end-to-end customer relationship management (CRM) solutions, which would include other elements such as:

-- IBM servers and storage products
-- IBM DB2 Universal Database
-- IBM analytical software, such as DB2 Intelligent Miner for Data andDB2 Intelligent Miner for Relationship Marketing
-- IBM access products such as CallPath and Direct Talk
-- eBusiness software from IBM business partner Siebel Systems
-- Other ISV call center and sales automation software

"The combination of IBM's DecisionEdge for Campaign Management and Siebel's eBusiness offerings, demonstrates yet another example of the powerful technologies our alliance offers to forward thinking companies," said Dr. Steve Garnett, Vice President Business Development, Siebel Systems. "Together these products will enable our customers to build multi-channel, customer-facing infrastructures uniting field sales and service, marketing and call center professionals, Web sites and business partners into a comprehensive campaign execution system."

DecisionEdge for Campaign Management works with customer information in a data warehouse from transaction systems, call centers, Web sites, and third-party syndicated data. The information is then shared among all the company's functions and allows consistent messaging through the customer's preferred channels, leveraging the database capabilities of DB2 Universal Database. In addition, marketing executives can get a high-level view of customer relationships and evaluate campaign results more effectively.

"DecisionEdge for Campaign Management leverages DB2 Universal Database's strengths in parallelism and scalability to allow marketers to better manage ever-growing customer databases," said Janet Perna, general manager, IBM Data Management Solutions. "It also works with IBM's DB2 Intelligent Miner family to produce more precise cross-sell and up-sell opportunities."

There are three types of campaigns that DecisionEdge for Campaign Management can perform:

-- Target segment - Campaigns that identify prospects in certain segments, such as those customers over age 30 who scored most likely to buy a car.

-- Event-triggered - Campaigns that are based on specific customer actions or events that trigger a pre-determined promotion or offer. For example, select all customers who made bank deposits of $10,000 or greater in the last 60 days.

-- Inbound - Campaigns triggered by contact the customer initiates. For example, market a relevant set of promotions to those customers who inquired about a home insurance policy.

The software works by clustering groups of customers according to their expressed preferences. All of these campaigns contain security features to safeguard confidential customer data, including control filters to exclude those customers who wish to be opted out of a specific contact channel and to block sensitive data elements (such as gender or income).

This software helps establish a relationship similar to the ones local shopkeepers traditionally have had with their patrons by leveraging an understanding of customer preferences.

"Our customers' needs are different depending upon lifestyle, life stage, age and a host of other factors," said Mr. Machida, senior manager, business planning department, Sumitomo Trust and Banking Company, Ltd. "This solution helps us have the scientific insight necessary to provide good Customer Relationship Management (CRM) by discerning even the most subtle differences among people and acting accordingly."

In addition to the dialogue function, DecisionEdge for Campaign Management has a "closed loop" characteristic. The software sets rules to limit the number and type of concurrent campaigns a customer or prospect experiences in a given time frame. In addition, the software allows marketing executives to quickly adjust and redirect unsuccessful offers for greater success.

DecisionEdge for Campaign Management manages the overall campaign activity to help ensure that high-priority campaigns are executed first and that no channels will be overloaded. For example, a money market account promotion might be considered a higher priority than a credit card offer, and, therefore, would be promoted in that order.

Japan's Sumitomo Trust and Banking Company, Limited
Sumitomo Trust & Banking Co. Ltd, one of Japan's largest institutional investors, with approximately 12 Trillion Yen under investment, is one of the first customers using IBM's DecisionEdge for Campaign Management. Sumitomo implemented a new marketing data warehouse to match targeted offers to its more than 3.5 million clients at the right time in their life cycles.

The bank's 50 domestic branches now share data; and households and the individuals within them appear as one. "The new technology spurred us to think in terms of individual customers rather than in terms of products," said Mr. Kimura, manager, business planning department.

Using the analysis capabilities provided by IBM Intelligent Miner for Data, the team evaluated which marketing tactics netted the best responses.

"Our prior response rate of 1.2% has increased to 6% with the help of the solution," Mr. Kimura notes. "We spend the same amount of money for promotions but now we get better results." Mr. Machida said, "Even with the very simple model of sending targeted promotions to the most appropriate audiences, we increased responses fivefold."

The information uncovered by the solution will help Sumitomo in all areas of CRM -- acquiring new business, promoting additional products through cross-selling, retaining customers, improving campaign management and introducing incentives for recruitment of new customers by "word of mouth."

"We can analyze data to determine if a particular customer is exhibiting the typical signs of attrition, for example," comments Mr. Machida. "And we can encourage our sales professionals to quickly institute cross-selling strategies to encourage loyalty."

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