Getting personal (again)

Computerworld - When Marvin Schwan decided to bolster his family's dairy business by selling ice cream door to door more than 50 years ago, he quickly developed relationships with the customers on his route. He must have been doing something right: Since then, privately held The Schwan Food Co. has grown into a frozen-good giant, with 5 million customers in 48 states and estimated revenue of $4 billion. It sells into homes through its Schwan's Home Service Inc. division as well as into retail locations.

When Schwan's decided a few years ago to leverage the Web as a key customer sales channel, executives wanted to translate the personalized experience customers get in their homes and through the call center into the online experience, according to Glenn Bader, director of e-commerce and emerging channels at the Marshall, Minn.-based company. Doing so required, among other efforts, centralizing data from the customer master file and other sources in a dedicated data mart and finding personalization software that could recommend an individualized mix of products and offer personalized incentives to site visitors. For its personalization, campaign management and marketing analytics needs, Schwan's chose Interaction Advisor from San Mateo, Calif.-based E.piphany Inc.

Personalization technologies came on the scene to much fanfare during the dot-com craze, but for a number of reasons, they didn't live up to the hype. Based on concepts such as one-to-one marketing, personalization tried to treat all customers as unique, but the numerous business rules required to do so were difficult to maintain and greatly affected online system performance. Moreover, many businesses found that the majority of their customers simply weren't different enough to justify the expenditures.

Nonetheless, many large companies today are seeing significant returns from personalized marketing, sales and customer service efforts through CRM strategies that combine a host of factors. They use appropriate personalization algorithms and sophisticated analytics for understanding behavior and focus on a smaller group of customers—typically high-value, frequent customers.

Glenn Bader, director of e-commerce and emerging channels at The Schwan Food Co. Image Credit: Steven Wewerka

Daily or even more frequently, managers establish contact priorities for Harrah's service-oriented hosts by running Cognos queries against a Teradata warehouse to identify appropriate segments and then feeding results into the Clienteling data mart. Blue Martini's personalization engine generates contact names and reward offers appropriate to the current promotional campaign of Harrah's. For example, if an event on a certain night isn't filled, hosts can target specific customers and make a personalized offer based on behavior and preferences.