Best use of FastStats® 2013 Award
Using FastStats® to model and predict customer potential to enhance marketing communications
P&O Ferries is the country’s leading ferry operator offering a wide range of services and facilities, with the most comprehensive route network and the most frequent passenger and freight services to the Continent. P&O Ferries has five ferry routes across the English Channel, the Irish Sea and the North Sea namely: Dover to Calais; Hull to Rotterdam; Hull to Zeebrugge; Liverpool-Dublin; and Cairnryan/Troon to Larne.
Over the last 10 years the UK ferry market, specifically on the Dover Straits, has become increasingly competitive. Now there is far more choice for consumers and, with ticket purchases being largely based on price and availability, only a few of these consumers are brand loyal. This ever increasing problem means that retaining the consumers that P&O Ferries (P&O) knows, and growing their value, is all the more important.
P&O makes extensive use of direct marketing to leverage its new and existing customers, and communicates with its customer regularly, therefore a readily, accessable SCV is essential. Since 2007, P&O’s marketing database has been hosted in FastStats®. R-cubed (a leading marketing services and analysis team) created and manage the FastStats® database, empowering P&O with ease of data access, insight and effective targeting of multi-channel marketing communications. However, given the changes in the ferry market, P&O’s SCV has been evolving over the last 5 years.
P&O Ferries are investing in FastStats PeopleStage™ to enable them to select, automate, execute and measure their entire customer journey.
- To further P&O’s understanding of its share of the Dover Straits ferry market
- To build customer potential into the segmentation and targeting activity
- To tailor specific sales and marketing plans towards exploiting high potential/low potential segments, to maximise revenue growth
To answer the project objectives, and to subsequently increase revenue in increasingly competitive market, R-cubed undertook an in-depth customer potential analysis with P&O.
P&O had been intelligently monitoring which of its customers have and have not yet made a booking, but still could not answer the key question of whether they are still active in the market. P&O and R-cubed knew that P&O would gain a huge competitive advantage by leveraging the market potential of its customers, if they could determine the potential for each customer individually. R-cubed helped P&O to reveal this dimension by asking customers about their travel habits.
Using the results of the questionnaire to model and predict the customer potential over the entire UK Dover Straits customer database –providing another layer of segmentation, and thus allowing segment identification and targeting at a much more granular level (e.g. to be able to identify lapsed P&O customers who travel regularly with another operator for reactivation, or target deal-conscious regular travellers who travel regularly but have a high degree of promiscuity with a campaign designed to increase brand loyalty).
The customer potential project initially focussed specifically on the Dover Straits Route. After the first phase of testing, a second project was soon underway to expand to cover the Irish Sea routes. Due to the perceived differences in the nature of the Irish Sea business and the competitive environment on the route, the Dover Straits model could not be simply rolled out for the Irish Seas.
The insight gained throughout this customer potential analysis and re-segmentation exercise was instrumental in informing the contact strategy for Q4 2012 and onwards into 2013. The new segments were applied firstly in the retention activity but will be rolled out to other activity in 2014. The details of these campaigns are below. Within each campaign, the investment is varied by segment and the contact strategy includes testing different messages, channels, timing etc.
- Retention activity: Regular Email and Direct Mail campaigns to encourage repeat bookings
- Welcome Back: Email and Direct Mail campaigns to improve retention rates across key customer segment groups
- Anniversary: Email and Direct Mail campaigns to improve retention rates across key customer segment groups who have not booked yet
- Summer Campaigns for Irish Sea & Short Sea: Regular Email and Direct Mail campaigns to encourage Summer bookings across key customer segment groups who have not booked yet
How FastStats® was used to meet objectives
P&O’s marketing database has been hosted in FastStats® since 2007 and is at the heart of all of P&O’s direct marketing and customer analysis. FastStats® is used to query, select, target, analyse and measure marketing activity. Not surprisingly then, FastStats® was vital to the success of this project and allowed P&O to quickly, accurately and cost-effectively undertake the following stages of the project:
- Select questionnaire recipients in proportions relevant to modelling back to the customer base
- Join responses back to actual customer behaviour and characteristics
- Streamline analysis variables held within FastStats®, making it easier to segment based on factors like distance from the ports, route preference (Dover Straits only, North Sea only, multi-route bookers, closed route bookers etc.) and total booking value over the last 12 months/ever. This allows greater accuracy in mailing selections, further ensuring that P&O mail the right people with the right offer at the right time.
- Apply the new customer potential rules to the whole base
- Incorporate the new segmentation layers into the existing customer single view and selections for ease of testing its impact in multi-channel marketing activity
- Implement the contact strategy – initially retention activity, following by Welcome and anniversary campaigns
- Monitor, report on and compare the results of the tests using FastStats® comprehensive history of multi-channel activity
Due to the successful testing of customer potential, it became apparent that it was essential to further vary the investment by segment, particularly in the way offers are targeted across the base. To that end, P&O Ferries are investing in FastStats PeopleStage™ to enable them to select, automate, execute and measure their entire customer journey.
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