Wikipedia.org: Event Driven Marketing (EDM) is the discipline within marketing, where commercial and communication activities are based upon these relevant and identified changes in a customer’s individual needs. In this context, an “Event” is defined as a detectable change in an Individual’s circumstances, today, which is relevant and significant, either in fact or in their mind.
A Significant Event is a major happening in a customer’s life. They can lead to a measurable change in a customer’s normal behaviour, state of mind, personal circumstance, or interaction pattern. It offers a reason to communicate with the customer, with a relevant proposal, at the right time. Events increase the knowledge, understanding and information about a customer that enables the marketer to make better, more informed decisions. Event Driven Marketing (EDM) is synonymous and exactly the same as Event Based Marketing (EBM). In some cases it is also referred to as Trigger Based Marketing. The definition above is consistent for all of these terms.
The theory behind Event Driven Marketing is that the most productive message is one that is relevant to the Customer and based on what’s going on in their life at that moment in time. EDM expands the relationship with customers by monitoring them (and their personal or commercial situation) on a constant basis and responding immediately to relevant changes in their circumstances. This includes monitoring both their transactional behaviour (as is done in direct marketing) as well as their life or business circumstances beyond your immediate transactional relationship. The results from implementing EDM are notably spectacular and have a positive effect on several common marketing KPIs and metrics. Some metrics affected include Customer Satisfaction and Churn/Retention .
Types of Events
A Trigger is a circumstance that has happened to a Customer today but which is not necessarily significant. It is this lack of significance that differentiates a Trigger from a Significant Event. Triggers are not very accurate and as such their use is not generally advocated. However they can be extremely useful when considered in combination with other Triggers or Events (see behavioural Events below). Triggers can be very valuable for activation of straightforward business processes. Their best use is for actions that are completely automated and which require no human intervention. Thus they can be programmed to fire whenever a defined circumstance occurs, and provide a clear result. In such situations they are a very cheap and effective tool. Examples can include things such as
- Triggering the issue of a new cheque book when the penultimate one is issued
- Sending an SMS offering a new mobile top-up when the current one has 10 minutes left
- Sending an SMS offering an overdraft facility when an ATM max payment is made, etc.
The key to using effective Triggers is that the resulting action is binary, ie. Situation A results in Action B. They can be very effective for Service based offers. Thus a Trigger satisfies the standard Event criteria of Individual and Today but fails in terms of Significance. It should be noted that the timescale for communication of a Trigger can be anything from instantaneous to the maximum of a day or so. After this, it is not worthwhile.
Simple (predicted) events
Most Events are reactive, ie. Based on what has previously happened. But some Events we can predict situations that will occur in the future. For example, a customer will finish his loan in 30 days. Undoubtedly, this is important to the customer and a good reason for communication. It is hardly a surprise and there is no urgent need to communicate today. In fact we can schedule a call anytime over a two week period and get the same result. Thus the event satisfies the standard Event criteria of Individual and Significant but fails on Today. We call this type of Event a Predicted or Scheduled Event. Examples include
- End of contract
- End of loan
- Significant Birthday and any kind of Customer activity for which there is a known, scheduled date.
The timescale for communication of a scheduled Event can be a window anything from 5 to 30 days or even more.
A single, significant event tells us something about the Customer. It is an excellent indicator of real / potential change. Customers are very responsive and accepting of communication at this time. Examples include
- Large Deposit
- Salary start / stop, etc.
The timescale for communication of a Significant Event is usually quite short – usually only 1 to 2 days. After this, the effectiveness drops rapidly (typically response rates drop at 60% per day).
Behavioural (Super) Events
A single, significant event may tell us something about a customer, but sometimes Events happen in groups and the sequence and combination of these events can tell us a lot about the behaviour and circumstances of the Customer. For example, a Customer may have a Large Deposit and this would be of interest, but a Large Deposit followed by a Large Withdrawal and then a Salary Stop (within a short period of time) may signify something much more important such as ‘Redundancy’. A Super (or behavioural) Event is a situation where a series of circumstances happen to a customer within a specific period of time and possibly in a certain sequence. These circumstances can be combinations of such things as Events, Scheduled Events, Triggers (see above) and even other Super Events. Examples of circumstances that Super Events can potentially detect include
- Moving house / job
- Marriage, etc.
Lifecycle Events are very similar to behavioural Events and can sometimes be detected in the same way. Their value is undoubted, with one Dutch bank claiming that 55% of ALL product sales they made were from customer Events based on Lifecycle changes. Examples include
- First job
- First apartment
- Getting married
- First child, etc.
* Most of the content on this pages is a direct copy of Wikipedia.org or mostly based on the content of Wikipedia.org.