Head, Data Warehouse Competence Center
Increase sales - even in a tough economic climate
Quaestor integrates untapped customer information for more targeted marketing campaigns
Quaestor Group is a company with Hungarian ownership. Quaestor has four business lines that specialize in financial services, property sales and development, travel services, telecommunications and commerce. It is a medium-sized enterprise with more than 400 employees and 20 branch offices across Hungary. The company also has a presence in other European countries and overseas markets, serving approximately 200,000 customers. Pursuing a market strategy based on the core values of innovation, flexibility, quality and customer focus, the Quaestor Group considers its customers to be its most valuable asset. This belief is what gives Quaestor a competitive edge over other service providers. However, to follow a truly value-driven and customer-centric strategy, the company has to develop a deep understanding of its customers' needs.
While reaching a critical company size (regarding clientele, employment and marketing budget), Quaestor saw a clear need to adjust its internal processes toward a customer-centric approach and increase its organizational and information capital accordingly. As a result, the company had to shift from ad hoc campaigns to a conscious marketing strategy based on modern management principles supported by real-time data.
We generated more responses with less marketing effort. This is exactly what we wanted to achieve with the new system.
Planning the change
As a first step, Quaestor reviewed a wide range of CRM (customer relationship management) software. It needed an application capable of defining product baskets at a customer level, based on various client parameters. In addition to accuracy, the ability to manage complexity was also a key requirement since Quaestor considers customer relationship management as a strategic issue rather than just a workflow. During the evaluation phase, it became clear that Quaestor needed an end-to-end business intelligence framework that covers all the business units instead of just a CRM application. Therefore, Quaestor selected the advanced data warehouse and analytic applications of SAS.
"It was its competence and comprehensive features that made SAS stand out of the crowd. As revealed by a Gartner market survey, SAS applications offer outstanding capabilities to identify users' current service capabilities and future needs," said Gábor Horváth, Head of Quaestor's Data Warehouse Competence Center.
The SAS implementation started with a pilot project that used demo data to perform customer segmentation, create reports and test strategic balanced scorecards (BSC). "The pilot project revealed that we could get much more than just reporting software. Features such as time series analysis and churn forecasting were also available. The only question was when we would have the capacity to deploy them," added Horváth.
In the first year of the project, the greatest implementation challenge was to give priority to business goals, efficiency and ROI over technology deployment. It not only meant that business decision makers had to be convinced with effective internal communication to use the system, but it was also a challenge to measure the results, which was a key project focus. In a two-year period, Quaestor registered a 10 percent increase in the efficiency of new client acquisitions within its financial services business unit, which resulted in a 10 percent decrease in marketing costs per every newly acquired client. At the same time, the travel business unit realized a 30 percent increase in client acquisition efficiency.
"Quaestor is an excellent example to demonstrate that using advanced business analytic solutions is no longer the privilege of large enterprises. It can be used effectively also by a midsized business, just like Quaestor. The carefully developed architecture and the underlying, strong strategy focus guaranteed success, and this is not size dependent," said Péter Kárpáti Head of Strategy, Marketing and Project Management Division of Quaestor.
After SAS solutions were deployed, the first and most important change was that decision makers started to ask new types of questions, which indicated a changing mindset and a renewed strategy focus. Managers who used to be interested only in comparative sales figures asked questions about the preferences and behaviors of new customers. As a result, Quaestor gained a better understanding of customer needs and a greater customer focus. The new approach led to a more effective -- and measurable -- execution of business strategy.
Another major change was the emergence of an efficient and unified management information system. Using only one-fifth of its customer data for operational purposes before, Quaestor integrated previously untapped information into its operations and now transforms at least two-third of its data into decision support intelligence.
Using SAS, Quaestor creates and executes a more precise marketing strategy - from defining target groups and messages to choosing the right actions and communication channels - leading to business success. Quaestor can now segment its customers, which helps to plan more tailor-made marketing campaigns.
For example, customer segmentation allows Quaestor to create smaller, focused target groups, which results in better response rates. The system is able to measure the results of each marketing campaign, predict how many clients can be reached by which actions during the next campaign, and show how profitable the old and new clients are. Having such detailed campaign information helps to ensure that the marketing budget is spent in the most effective manner. Additionally, a successful campaign also affects the development of new products and services.
"Many people believe that business intelligence cannot generate a tangible ROI. We made an attempt to quantify our return on this investment. Obviously, SAS had the largest positive impact on the marketing function, so we first tried to quantify marketing improvements. A change in response rates and distribution numbers was apparent already in the first direct marketing campaign completed after the system was installed. We generated more responses with less marketing effort. This is exactly what we wanted to achieve with the new system."
It was partly due to this enhanced efficiency that Quaestor was one of the few capital market service providers reporting a 35 percent increase in revenues in one year.
Today, Quaestor consults its SAS system before every data mining marketing campaign and designs its communication campaign separately for each segment. As a result, some products and services have achieved a 100 percent increase in sales per campaign, indicating a higher customer satisfaction and lifetime value. Initially, Quaestor's marketing managers were the most active SAS users, but now there are more than 150 users (including branch office managers and sales staff) of the new system. The company has just started to explore the value offered by the wealth of information now analyzed with advanced analytic applications.
"We are experiencing a kind of an information revolution this year. Now that the global economic crisis has increased the importance of efficient operation and fast response, we find significant hidden reserves within the company due to the SAS system. It's surprising how much efficiency can be improved in middle-sized companies by using advanced business analytics," said Horváth.
Quaestor wanted to realize a major increase in sales revenue per marketing campaign
In a two-year period the financial services business unit registered a 10% increase in the efficiency of client acquisitions resulting in a 10% decrease in marketing costs per newly acquired client. The travel business unit realized a 30% increase in client acquisition efficiency.