Segmenting Customers

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Written by Ivey Brent Laminack Ivey Brent Laminack

Category: other thoughts other thoughts

Published: 11 March 2014 11 March 2014

There are two ways of segmenting customers. The most common is to decide how many segments we want and the general parameters. Nonprofits do this a lot: they segment mailing lists into small, medium and large donors. But this approach opens the door to misleading customer or other views.For example, consider segmenting a roomful of people by height. One way would be to decide on the categories: short, average and tall, then assign people to their proper category.The problem with this approach is most clearly seen if the roomful of people is at the four-year-old story time at the library.There are actually only two categories of people here, not three: short four-year-olds and taller moms.In essence, such a segmentation approach takes an opaque block of data and arbitrarily cuts it up into smaller opaque segments. This approach was common in the "decision support systems" of the previous decade. These mostly evolved into "decision justification systems" used to justify arbitrary management decisions.The other way is much harder: to "listen" to the data and see how customers actually group, or "cluster." By listening to the data we can spot our flawed preconceptions of categories. This approach shines light through the block of data, illuminating where the data actually lies, like sonar showing where fish are schooling.The second approach is where the art of data mining comes in. In true data mining, we don't start knowing the right questions to ask, let alone the correct answers. We let the data guide us into the correct ones, using tools like cluster analysis to hear what the data is saying.One axis of measurement should be customer equity. We look for significant groupings of customers that provide clues about why some customers are more profitable than others. We also look for clues about how to move them up the profit chain.For example, at one nonprofit I worked with, we did cluster analysis and found that the natural clustering of patrons was actually more closely tied to how many times they had contributed, rather than the grand total of their gifts. Once we understood that faithfulness in giving was more important than a one-time "flash in the pan," we could properly cultivate our long time, profitable donors, rather than chasing after another long-shot "flash."Progressive Insurance has put such data-driven segmentation into practice. It has refined customers into much more meaningful clusters than their competition. It's been reported that they score vehicles according to 12 different metrics, and credit scores along 16 different metrics. The results illustrate what we know intuitively: all young drivers aren't high risk, all older drivers aren't low risk. The analysis not only allows them to avoid turning away potential customers unnecessarily, but also calculate appropriate premiums for faster positive customer equity.Look for a lot of activity in data mining and data visualization in the next few years. "In five years, 100 million people will be using an information-visualization tool on a near daily basis. And products that have visualization as one of their top three features will earn $1 billion per year," says Ramana Rao, founder and chief technology officer, Inxight Software.A good book to read is The Visual Display of Quantitative Information by Edward R. Tufte (1983, Graphics Press). The title is dry, but the book is filled with examples of elegant, deceptively simple graphical techniques.Some lessons to help you gain insights from your data:

• Do you segment data according to your own rules, or listen to the data?
• When was the last time segmentation strategies were re-examined?
• Are your segments statistically significant?
• How do you visualize your data to see if segments are meaningful?

If you don't have data mining and visualization expertise in-house (few do), hire a professional for a short-term contract.If you don't know what's happening in your customer database, you're "flying blind." And, like a plane without proper instrumentation, you'll eventually crash and burn on the mountain that you should have seen, but didn't.

The Future of Christian Radio

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Written by Ivey Brent Laminack Ivey Brent Laminack

Category: other thoughts other thoughts

Published: 11 March 2014 11 March 2014

In discussions with others in the Christian Radio industry, we've been trying to discern what Christian Radio will look like a few years down the path. It's always very difficult and dangerous to make linear projections from the present to the future, because non-linear forces that may seem insignificant at present soon dominate the prediction in unforseen ways. This is commonly called the Butterfly Effect (See Chaos by Gleick). Nonetheless, we'll give it a will try.

Brief Historical Perspectives on Christian Radio

In the past, Christian radio had music and preaching interspersed. Some stations were all-music, a few all-preaching. The popular preaching format was 15 or 30 minute daily programs airing at the same timeslot every day. Currently, the landscape is changing. Music is becoming more prominent. More stations are all-music, and many more are programming a larger segment of the broadcast day with music. The time slots for preaching are being reduced. Even five-minute features are being deemed too long, and a new field of ninety-second programs are being produced. The old bastion of Moody is hurting. A new force in the industry is Salem Communications. They have taken advantage of relaxed FCC rulings and centralized labor-saving administration and production to reduce costs. This is much the same as Clear Channel has done in the secular realm. At the same time, the Internet and Satellite radio such as XM and Sirius are starting to be players in the market.

So what is the future of Christian Radio?

This is probably the wrong question. It is akin to somebody in 1940 asking "What is the future of railroads?" The better question would be "What is the future of transportation?" This would give a clearer picture: it would include airplanes and interstate highways. So let's ask a better question:What is the future of Christian Listening?Why is this a better question? As the railroad question above shows, the better question is to ask about the item that won't go away: the constant, the basic concept. Transportation will still be around, railroads may or may not. In a similar vein, listening is the essential human endeavor, the specific medium will change. So on to: What is the future of Christian Listening?Specifically we'll ask this not in terms of music production, but as it affects what we'll call the Speaking Ministries. These are the ministries that produce spoken-word material for the Christian Listening market.

Safe Prediction:

As technology gives us more options listeners will take advantange of them. One hundred years ago the mode of Christian Listening was: Live. Fifty years ago, the modes of Christian Listening were: Live, Vinyl Records, AM or Shortwave Radio. Today those options include: Live, CD, AM, FM, Shortwave or Satellite Radio. Soon Digital Radio will be added. Add to this cassette tape, media-neutral compressed digital (MP3, AAC, Ogg, Real, Windows Media, etc.) delivered via the Internet or personal audio player (such as the Apple iPod), Cable Radio, and Wireless Digital. From this list of options we can make a fairly safe prediction that the Christian listening market will become more fragmented. Each medium will have a smaller market segment. The total Christian Listening market size will probably remain fairly constant or grow slightly. Another fairly safe prediction is that the Speaking ministries that will prosper will be those that do two things: 1) provide their audio over as many different media as possible and 2) do this as cost-effectively as possible. In other words, produce a program once and have it available via many different delivery mechanisms with next to no additional expense.

Safe Prediction:

Listening will become much more listener-scheduled than provider-scheduled. Many of the delivery mechanisms are that way already: cassette, CD, digital media. Only live and radio are provider-scheduled. Recently television has become more viewer scheduled via Digital Video Recorders (DVRs such as TiVO and Replay TV). Soon TiVO-like boxes for digital radio will appear. These will allow listeners to time-shift radio broadcasts and mix them with their favorite music tracks.

Safe Prediction:

Ministries will become more multi-media and new-media. This has already taken place to a degree in the migration of the major Speaking Ministries from straight audio into video. In other words, from radio into television and cable. Rev. Herbert Armstrong the senior became the leader of one of the largest churches in America through the outlet of television. In the 2004 American Presidential campaign, Howard Dean became a force through extensive use of the Internet. Soon a major national ministry will arise that has the Internet as its major outlet. This will probably happen within the next five years. Speaking ministries may stay primarially speaking, but will add on other media such as web sites that have study notes available, combined audio/video streams that may not have full-motion video, but do have outlines, sermon notes and scripture references in sync with the audio. Again, the ministries which produce these multi-media streams in a timely and cost-effective manner will be most successful.

Safe Prediction:

Speaking Ministries' programs will become shorter, with more interspersed production elements. This is a result of the Sesame Street/ MTV/short-attention-span (almost ADHD) popular American mindset. (If you skipped down and read this paragraph out of order, my point is taken.)

Not-As-Safe Prediction

Speaking Ministries interaction with their supporters will become much more "new media" to keep in step with their message. The traditional monthly appeal letter for fundraising will be augmented by personal audio appeals to select groups, delivered via CD or the Internet. The scheduling of the appeal will be driven less by the calendar and more by current events and the activity of the ministry supporter. Example: a person downloads a speaking message over the internet for a low fixed price ($0.99?). At the start of the message, they're encouraged to go to a given page within the ministry's web site to download a pdf of the message outline and study notes. At the end of the pdf file is a brief appeal letter with a link to a web page where they can make a financial gift to the ministry. If the person follows the link and makes a gift, an e-mail will be automatically generated thanking them and offering them the opportunity to join a live webinar with the ministry's speaker on a given date, and perhaps to interact with the speaker via instant messaging. A later followup appeal may be made via email with a link to an audio version of the appeal, or by mass-mailed CD or DVD. Again, those ministries that make effective use of these new media interactions will make better connection with their partners and have more opportunity to prosper than those who don't.Another result of these changes will be the way ministries track their interactions with their supporters. Since there will be a number of ways for the supporter to interact with the ministry, and these ways will largely be scheduled by the supporter, the ministry will have to give up a large measure of its control over when and how the supporter and ministry make contact. Tracking these interactions with supporters will become a much more complex task. Since the straight-line interactions of the past (listen to this week's message, order the tape, get the tape, get a magazine, etc.) will give way to much more dynamic, user-defined paths, new types of information systems will have to be developed to track these interactions. New ways of segmenting the ministry's supporters will also have to be developed. More flexible databases will be required to track these interactions. Because these new databases will track many more types of interaction data than current databases, sophisticated statistical tools will have to be used to provide meaningful segmentations of the supporter base.

At First Sight

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Written by Ivey Brent Laminack Ivey Brent Laminack

Category: other thoughts other thoughts

Published: 11 March 2014 11 March 2014

"A white dress she had on... I only saw her for one second... but I'll bet a month hasn't gone by since that I haven't thought of that girl."
Mr. Bernstein in Citizen Kane

As I sat in dim art-house theaters, I used to think Mr. Bernstein was crazy, or perhaps Orson Welles was for giving him that outlandish monologue. But as I age, I'm either beginning to believe him, or going crazy myself.The sighting happened on one of my early single days of living alone, working odd hours at odder jobs. One Tuesday afternoon I was at the local chain supermarket filling my cart with impulse odds and ends the way we guys tend to, calling it 'grocery shopping.' As I pushed my cart around the end of an aisle at the back of the slightly tatty store I saw a slender lass with long brown hair. She was dressed in a white coat working the deli counter. She looked at me, smiled and asked, "May I help you?" Medical science will soon confirm that buried deep within each man's cerebral cortex is a synapse that fires when a particular woman appears. She is the mythic amalgam of mother, first crush, Mona Lisa and the Venus de Milo, perhaps with overtones of Playmate of the Year, I'm not sure. When her image is conducted down the optic nerve, this synapse triggers. Its firing causes the pituitary gland to tremble in a unique paroxysm, reserved for this occasion. The master gland then secretes a singular hormone. Part of its molecular structure is like morphine, another part binds specifically to the muscles in the tongue. Within a heartbeat this hormone was circulating in my bloodstream. I wanted to tell her that I needed no cold cuts sliced today. I opened my mouth and excitedly spoke forth, "Yaggla-glog." She smiled an understanding smile and I pushed my rattle-wheeled cart down the canned meats aisle. Not that I really wanted any Deviled Spam or Potted Meat. I just had to escape from the pain of my failure.The next Tuesday afternoon I was armed with a long list of unneeded deli meats to purchase. I had practiced this list a good while in front of a full-length mirror. But when I returned to the deli counter, she wasn't there. I've never seen her again. Sometimes I think I catch a glimpse of her getting out of a car, or riding the opposing escalator, but it's never her. It's been two decades since that Tuesday and my mind still turns back to her at random moments. Love and fame are indeed fleeting as what's-his-name the poet said. Could I find her again? I don't know. If I were to go down to the police station and sit beside their artist to form a composite drawing of her, I know I couldn't. Her visage didn't register in my rational left brain. I couldn't quantify her height or describe the line of her nose. Her image is burned much deeper in my psyche, perhaps even at the genetic level. Yet, if I were to go to the other wing of the police station and look at a line-up (Police line-up? More likely to see her at a casting call for a re-make of Citizen Kane) I could pick her out in an instant, even out of ten thousand. I could point to her and say with absolute certainty, "Yaggla-glog."

Church Audio - Then and Now

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Written by Ivey Brent Laminack Ivey Brent Laminack

Category: other thoughts other thoughts

Published: 11 March 2014 11 March 2014

I ran sound at First Baptist Atlanta for a great many years, but have been out of it for about the past five or so. I visited the other day with a former employer, Conrad Feirn (Connie) at the Music Depot, Inc. They are now in the business of installing sound and light systems in churches across the Southeastern US. What I learned from him was very interesting.Twenty years ago church sound systems were little six or eight channel mixers with a couple of colums speakers, so people could hear the preacher or a soloist. Bogen, Sure and maybe Altec Lansing were some brand names back then. Not so now. Connie said that most of the installataions they are doing include projection TV screens, theatrical lighting, and concert-quality sound systems with components such as Bose speakers. What's the average size of a church so equipped? I asked. A thousand or two? Nope. The average size of such a church is six hundred seats. Yow! I commented that it sounds like a very competitive environment out there for the churches if they're spending that kind of money to get people in. Yes indeed, said Connie. If they go into a new community and put in a system in a church, within six months they'll be getting calls from the other churches in the area for new systems. Reminds me of the 1970s in the TV area. When one station got a new weather radar thingy, the other stations in the market had to get similar setups just to keep their viewers. People want to be entertained.Connie quoted a study he saw that said the average attention span of Americans over 25 was about 22 minutes. The 18-25 year old crowd had an average attention span of around 16 minutes. This may be said to be the commercial break time on TV. Connie knows of one pastor who has a timer in the pulpit. Every 13 minutes or so he steps away from the pulpit and tells a joke or some such to break the sermon up and keep people's attention focused.All in all, this sounds like a sad indictment of American culture in general and the Christian culture in specific.

Dead to What?

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Written by Ivey Brent Laminack Ivey Brent Laminack

Category: other thoughts other thoughts

Published: 11 March 2014 11 March 2014

Prolog

I've heard a lot of strange explanations of Galations 2:20 and Romans 7 where it says that the believer is dead. Dead to what? How did it happen? How do we walk it out? I've heard everything from that's "positional truth" (in other words, it's something that looks good on paper but is of no practical value), all the way to the position that whatever was in us that could sin was crucified, so now we can't sin (I wish that were true!). So here's an illustration of what I think it means.

An Illustration

I live in a hard country. We are under strict totalitarian rule. What the government and its agents say, goes. This with no appeal or recourse. One of the rules is that everyone must serve in the military whenever they are needed, for their entire life. How long these terms are for, how often and when they come are up to the government. They seem to be completely arbitrary about who serves when and where. I've been called up to serve several times. Unfortunately, I always wash out of basic training. This training is long and hard with even more rules than we have to obey in our regular life. Some of these rules seem terribly subjective and even contradictory, so I'm never quite sure if I'm following the ones I'm supposed to. Anyway, I always seem to wash out. Once I got sent home the first week. Another time I lasted six weeks. They wouldn't even tell us how long boot camp was to last, so I don't know how close I came to making it.You can imagine what life is like here. One can never make long-term plans, due to the threat of conscription hanging over one's head. One day a draft officer will show up unannounced at one's door, ask for your papers and take you away immediately. Life here is miserable.One day, however, I received an unexpected boon. In the mail I got an official document from the government. I opened the envelope and, much to my surprise, there was my death certificate. Clearly there had been some administrative mistake. But there is was, notarized and official. I was legally dead. Odd, I thought, but not much practical value. What good is it being dead? But then the next day, an idea began to form in my mind. Would it work? Should I try it? It might be worth a try.I got my chance two weeks later. First thing in the morning I heard a knock at my front door. Sure enough, it was an anonymous government official with two security officiers. I knew what was here for. He said I was to report at once to boot camp. I told him that I was sorry, but that the person he was looking for was dead. He double-checked his papers, muttering about having no record of that. I told him to wait and I'd show him the death certificate. He scowled as he looked at it, then mumbled a 'thank you', turned and left. I was overjoyed. It worked! Never again would I have to go throught the demeaning, back-breaking labor of trying to pass muster at basic training. I was free.Until...In our country, if we want to earn extra money, we can present ourselves to a work detail. One day I decided to do this. I brought my identification and went down to the labor office. But there was a conscription team waiting inside the inner office. After I'd presented my papers and signed up, I was sent through that door and was taken away again to boot camp. I couldn't tell them I was dead, I had already signed up. After four grueling weeks I had washed out again. Exhausted, I went back home vowing never again to fall into that trap.And so I live now, a "living dead" man. Dead to the laws of conscription, but alive and free to live as I wish. All because of my death.

  Explanation

Clearly the land I lived in was the Kingdom of Law. In the Old Covenant they had just the Ten Commandments, or according to some sects, 519. You never know if you're breaking a law or not. You never know when something will be demanded of you. It can happen at any time, for any duration. Worse, we always fail. Worst, we'll always have to try again and fail again. This is living under the law.Then comes the news that we're dead. Dead to what? The law. Did my body cease to live when I got saved? No. Did my flesh cease to exist? No. So, if I died, what did I die to? I died to the law (Romans 7:1-6). I leagally died. I no longer have to answer the call to obey the Law. I no longer have to meet an impossible standard. Is it just a "clerical error?" No, the papers are genuine. I'm really, legally dead. I must only have the courage to present the papers when a demand is made on me. I no longer have to live under the law.Unless...I choose to. If I wish, I can still choose to go back under the law. If I want to "get something" that I think I need. The only way to "get it" is by working for it. But there I am back again under the law. This is "falling from grace" back to law. It doesn't work any better than it did the first time. In order to maintain freedom, I have to ever bear with me the mark of the living dead. I have to no longer desire those things that can be obtained by my effort. I am legally dead, as accomplished fact, but now I must die internally to those things that I can work for. I must die to the desire to earn and achieve. In that way is this death worked out.