Anyone who has ever tossed advertising junk mail from their mailbox knows that marketing is an inexact science.
To add some precision to the process, IBM Corp. earlier this month released applications meant to give insurance and financial companies the marketing smarts necessary to better target their customers and price products.
Called DecisionEdge for Relationship Marketing, Insurance, the bundle comprises tools to create a data warehouse of customer information. It includes IBM's Intelligent Miner business-intelligence software and specialized third-party applications for cleaning and transforming data. IBM has also developed applications for the insurance industry for modeling and analyzing data and managing marketing campaigns.
The applications will help insurance agents and analysts segment their customers and build a relationship with those customers, IBM officials said.
"It's an industry that's seeing a whole lot of new competitors and some new business models," said Virginia Rometty, general manager of IBM's Global Insurance Solutions. "You'll see [companies] out there creating loyalty and delivering financial services through an information-based business model."
Insurer Farmers Group is testing the package and has already seen improvement.
"The application has provided us with a better idea of what type of pricing we need to place on certain segments of the market and ways of underwriting certain segments to profitability," said Melissa McBratney, vice president of business development at Farmers, in Los Angeles.
Consolidating seven databases into a single warehouse allowed Farmers to identify customer segments "that probably would have taken us months and months [to identify] before," McBratney said.
The suite, including hardware and services, starts at $1 million. It is one of the first products from IBM's newly formed Customer Relationship Marketing company. Officials said marketing software for other industries is in the works.
IBM Corp., in Armonk, New York, can be reached at www.ibm.com.
Tuning up financial forecasts
IBM's DecisionEdge for Relationship Marketing, Insurance includes many features.
-- Insurance Information Warehouse: data models specific to the insurance industry-- Analytical tools: for categorizing customers by risk and identifying candidates for marketing campaigns-- Campaign management applications-- Databases: IBM Visual Warehouse for creating customer databases-- Online analytical processing tools