Newport News Catalog Uses SAS® to Target Profitable Customers

After successfully implementing the SAS Solutions for Customer Relationship Management (CRM) in the late 1990s, Newport News Catalog was eager to take the power of SAS to the next level.

Customer Success Video

Check out this video to learn more about Newport News Catalog and its successes with SAS.

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Customer ViewPoint
You have questions; our customers have answers. Check out this video Q& A.

Neil O’Keefe
Divisional Vice President, Newport News Catalog

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Van Rhodes
Manager of Marketing Decision-Support Systems, Newport News Catalog

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"We've done the proof of concept. Now we plan to keep the momentum going," explains Van Rhodes, manager of marketing decision-support systems for the women's apparel retailer.

With the number of catalogs tracked each year increasing from 30 to as many as 80 since SAS was first implemented, the need for momentum is obvious. Before SAS, Newport News used a series of spreadsheets to analyze between 3,000 and 4,000 customer-mailing segments per campaign. Then Rhodes' team demonstrated the value of being able to bring together facts from mainframe operational data at the customer level with support dimensions imported from Excel spreadsheets to measure campaign successes. Now, team members know they could do even more to evaluate and predict success – right down to the customer level.

Newport News keeps five years of transactional data on more than 10 million customers, so that's a tall order. "Before, we were making the data handling and analysis we were already doing more efficient with SAS. Now we're doing things we could never have dreamed of doing before, and SAS has made it all possible," says Rhodes.

Making the Impossible Possible
Looking beyond individual campaigns and analyzing mailing segments across a season or a year used to be practically impossible. It took two analysts as much as a month to gather the data and crunch the numbers. Today, using SAS' renowned capabilities for multidimensional analysis, the job can be done in less than 30 seconds for any combination of mailing segments.

The first iteration of SAS at Newport News brought the ability to better evaluate the success of campaign segments targeting customers who had not made purchases in more than 12 months. But there were still questions, such as:

• How well do these customers perform subsequent to a promotional mailing? If they respond only to the special mailing, will they sink down in recency until the next special promotion?

• Is the revenue hit taken by offering the promotion offset by the reactivations within a reasonable time period?

• Does the company follow up effectively with reactivated customers? Are they kept active and profitable?

To answer these and similar questions, analysts needed the ability to select customers in targeted segments who responded to a specific campaign, then analyze their subsequent activity. Rhodes and his team turned to SAS to port their customer history tracking system from mainframe to an environment where it could be integrated with summarized campaign data.

Rhodes' team quickly realized that the communications network that supported them at the time wasn't up to crunching data on 10 million customers purchasing hundreds of millions of items from millions of orders placed from half a billion catalogs mailed across five years. The solution was a Sun Microsystems server.

Van Rhodes, Manager of Marketing Decision-Support Systems, Newport News Catalog

Newport News also has taken advantage of SAS' ability to bring information to individuals throughout the organization in formats suited to their specific needs. The CEO and CFO, for example, regularly query the data warehouse for answers to questions covering a wide range of customer knowledge issues. The same data warehouse was structured so that analysts could exploit the full power of SAS analytics for exploration, asking questions that no one had thought of before.

"Our analyst is able to look at the most detailed data in determining whom the next catalog should go to, and the president of our company is able to walk in each morning and see very quickly how all of our catalogs are performing in the mail," says Neil O'Keefe, divisional vice president. "And they can even look at each of our customer segments and see how well they've been performing in our most recent mailings."

How can other companies replicate the success of Newport News' data warehousing and customer relationship management (CRM) efforts? Rhodes and O'Keefe list several keys:

• Maintain a close alliance between IS and business analysts.
• Keep data structures simple and allow for continuous expansion.
• Realize that you can't build it all at once.
• Choose a vendor that provides a suite of products.

"With the introduction of the Internet in our industry, we've been required to change the way we report and the way we look at customers," O'Keefe says. "Having the flexibility that SAS gives us has been a great advantage for Newport News."

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