MediaOne ONE?

CABLE FIRM ACQUIRED BY AT&T BROADBAND IS IN SECOND PHASE OF A BIG DATABASE PUSH

TALK ABOUT CHANGE: The folks in the marketing department at the former MediaOne were barely into a seven-figure database upgrade this year when the company was acquired by AT&T.

But they kept their eyes on the task at hand, which was no small thing. They had to build a system that would allow better management of some 200 million customer contacts per year.

It all started in 1997, when the cable service marketer selected a third-party vendor to house its data and append demographics. But that was temporary. In 1998, the firm kicked off a longer-term effort to develop its data gathering capabilities. And last year it created an in-house database using an Oracle system.

As with many firms, MediaOne’s marketing data warehouse was not integrated with its sales and service centers; its inbound touch points relied on the billing system. In addition, the company segmented customers almost totally by geography, and it lacked the ability to model. Finally, there was a “strategy gap” between promotions done by MediaOne and what its salespeople said to customers.

But the Englewood, CO-based firm had to improve. For one thing, it had new products to sell – high-speed cable Internet access (introduced in 1997) and digital phone service (in 1998). “We were entering very competitive markets,” says Mark Voboril, vice president for CRM and e-marketing at AT&T Broadband. “And satellite competition in the cable business was going to increase our cost of acquisition for new products.”

The company also wanted to do a better job of understanding its customers. Was this a stab at one-to-one? Not completely.

“One-to-one’s a nice term, but we think of it as managing consumer segments, pushing information to understand needs,” Voboril says.

The program they came up with is hardly enterprisewide, but it’s pretty advanced for the cable industry. MediaOne started with the assumption that it had to drive information to the touch points regardless of the billing system.

“We couldn’t be dependent on the billing and customer service platforms because they always change,” Voboril notes. “We used the third-party software to augment and move around our legacy systems.”

To get to this stage, MediaOne relied on best-of-breed solutions. One key component was Rightpoint call center software, which enabled intelligent scripting for its call centers that handle inbound sales and service calls, and outbound telemarketing.

Telephone agents are now able to pull up a customer’s record on their computers and log in the reason for the call. They can also ask marketing-related questions, which may determine the products that will be cross-sold, says Larry Goldberg, senior director at Broadband Software in Natick, MA.

This has vastly improved AT&T Broadband’s segmentation capabilities. Normally, the firm performs three times better than random in predicting segment membership, according to Voboril. The addition of a few questions improved the rate to four to five times better than random. The call center upgrades have also led to a 10% to 15% increase in cross-selling in the two markets for which it has been used.

Also deployed was Market Switch, a channel optimization tool. It enabled the firm to instantly determine what the minimum and maximum offers should be, the cost per sale and other factors.

This improvement produced an 11% hike in sales of telephone products, and the addition of several hundred incremental high-speed data customers in the targeted markets. It was due, in large part, to the fact that the firm was now able to target by propensities.

Other ingredients in this software stew include Prime Response, a campaign management tool; and SAS Enterprise Miner, a data mining program.

Voboril acknowledges that it’s a work in progress. Phase two, now under way, is focused on getting information to the touch points. In the final phase, the company will try to optimize all its channels and improve its cost structure.

“We’re still working through that right now,” Voboril says.

What would Voboril do differently? “We’d focus more on short-term business problems instead of chasing longer-term solutions,” he says.

And why? “You have to have short-term wins to keep momentum.”