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HOW PREDICTIVE MARKETING ANALYTICS EMPOWERS FINANCIAL LEADERSHIP

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HOW PREDICTIVE MARKETING ANALYTICS EMPOWERS FINANCIAL LEADERSHIP

Phil Crothers, Chief Marketing Officer, BrightTarget

The role of the CFO is changing from “cost authority to business value architect”, as Accenture neatly put it[i]. 73% of finance leaders say they’ve been more engaged with strategy over the past two years; financial management is no longer the CFO’s sole domain:

“Finance 2020 – tomorrow’s digital finance organisation – is a radical departure from the status quo. It deals in analytics and forward-looking decisions to create value and manage risk. […] It trades reporting the past for predicting the future.”

CFOs need to add greater strategic value in order to become core decision-makers, responsible for driving organisational growth.

Right now though, three major barriers prevent finance executives from realising their full leadership potential, which can be solved through the adoption of predictive marketing analytics. Focus on these three main benefits for CFOs..

  • Predictive marketing analytics align Finance and Marketing

Traditionally, the finance and marketing relationship has been a difficult one. This prevents the fruitful collaboration needed to drive growth. As Forrester observes:

“Marketing and finance share the goal of increasing revenue but often have different perspectives and key performance indicators without a shared understanding of their relationship. In many cases, marketing struggles to demonstrate its value to the finance team, which results in underfunded marketing departments that can’t produce the business results finance leaders are most focused on.”[ii]

Marketing feels they’re not getting recognition for their achievements. Finance sees marketing as an endless cost centre. This is not an easy fix. Forrester research shows 78% of respondents agree that marketing-finance alignment is vitally important, but only 15% feel that the two departments currently work together towards shared goals.

At the very core of this rift is an inability to measure the impact of marketing in wider financial terms. That’s where predictive marketing analytics steps in.

Advanced predictive creates a centralised metric that brings marketing and finance onto the same page: Customer Lifetime Value, CLV, which represents predicted lifetime revenue in quantitative financial terms.

CLV allows marketing to see which accounts are most worth targeting so it can better focus its efforts, and in turn build a better business case for reinvestment; and finance can see exactly where revenue is coming from, through a clear, centralised dashboard. Finance executives get complete future-based oversight of marketing performance towards tangible financial goals – so they can make better decisions about the wider business.

  • Predictive marketing analytics put customers at the centre of business decision-making

Smart organisations understand the importance of a customer-centric business model, and prioritise metrics like customer loyalty as key drivers for long-term profitability.

However, this customer-centric business model has traditionally been at odds with the legacy finance function. Finance focuses on quantitative financial metrics like cost, profit and revenue. There’s little space for metrics like customer loyalty within that model – which has held financial leaders back.

Predictive marketing analytics provide rigorous, quantitative metrics that can be trusted. Businesses can embrace a more customer-centric approach that’s driven by, not detached from, firm financial insight.

  • Predictive marketing analytics dissolve data silos

Data silos reduce visibility across the business, stopping CFOs from developing a unified forward-looking narrative. CFO.com reports more than 70% of surveyed finance executives rank their biggest 2017 goal as supporting business decision-making – but over 90% say they need to do more with financial and operational data to help make those decisions[iii].

Predictive marketing analytics overcomes this hurdle by giving CFOs centralised oversight that transcends individual departments. This centralised data forms a unified narrative for the CFO to form insights that drive business strategy. This narrative relies on Customer Lifetime Value and allows unifying the business around customer-centric goals. With these insights, CFOs can better allocate resources, better forecast, and even identify new market possibilities.

The hurdles that prevent financial executives being better strategic leaders are overcome with predictive marketing analytics. The sector is picking up pace rapidly though, as Forrester validates with its June 2017 ‘Forrester Wave™: Predictive Marketing Analytics for B2B Marketers Q2 2017’ report[iv].

The comprehensive report, downloadable here, lends significant credibility to predictive, emphasising “Early PMA adopters are seeing their efforts turn into real, measurable results”.

[i]Accenture Strategy, Finance 2020: Death by Digital

[ii]Forrester, How Aligning Finance and Marketing Will Drive Business Success

[iii]CFO.com, CFO’s Top Goal for 2017: Better Analysis and Reporting

[iv]BrightTarget Cited as a Strong Performer for Predictive Analytics for B2B Marketing”

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Boeing, hit with $6.6 million FAA fine, faces much bigger 787 repair bill – sources

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Boeing, hit with $6.6 million FAA fine, faces much bigger 787 repair bill - sources 1

By Eric M. Johnson and David Shepardson

SEATTLE/WASHINGTON (Reuters) – Boeing Co will pay a $6.6 million to U.S. regulators as part of a settlement over quality and safety-oversight lapses going back years, a setback that comes as Boeing wrestles with repairs to flawed 787 Dreamliner jets that could dwarf the cost of the federal penalty.

Boeing is beginning painstaking repairs and forensic inspections to fix structural integrity flaws embedded deep inside at least 88 parked 787s built over the last year or so, a third industry source said.

The inspections and retrofits could take weeks or even up to a month per plane and are likely to cost hundreds of millions – if not billions – of dollars, depending to a large degree on the number of planes and defects involved, the person said.

The Federal Aviation Administration said Boeing had agreed to pay $6.6 million in penalties after the aviation regulator said it failed to comply with a 2015 safety agreement.

The penalties include $5.4 million for not complying with the agreement in which Boeing pledged to change its internal processes to improve and prioritize regulatory compliance and $1.21 million to settle two pending FAA enforcement cases.

“Boeing failed to meet all of its obligations under the settlement agreement, and the FAA is holding Boeing accountable by imposing additional penalties,” FAA Administrator Steve Dickson said in a statement. Boeing, which paid $12 million in 2015 as part of the settlement, did not immediately comment.

Boeing engineers are working to determine the scope of inspections, including whether jets can be used as-is without a threat to safety, two people said. Boeing has not told airlines how many jets are impacted, another person said.

The FAA has been investigating instances of oversight lapses, debris left inside finished aircraft, and managers putting pressure on employees handling safety checks for the FAA, people familiar with the proceedings said.

For example, in August 2020, Boeing told to the FAA about the flaw involving structural wrinkling in the interior fuselage skin where carbon-composite barrels that form the plane’s lightweight body are melded together.

But the defect went unnoticed for months or longer because computerized safeguards that crunch data looking for quality flaws had not been programmed to look for the gaps, a third industry source said.

DELIVERY TARGET

The 787 production problems have halted deliveries of the jet since the end of October, locking up a source of desperately needed cash for Boeing.

The fuel-efficient 787 has been a huge success with airlines, which have ordered 1,882 of the advanced twin-aisle jet worth nearly $150 billion (74.7 billion pounds) at list prices.

But the advanced production process and sprawling global supply chain caused problems over the years.

As of February, Boeing had fixed the 787 production process causing the wrinkling defect, according to two people familiar with the matter.

However, planes rolled off the assembly line with the flaw for more than a year, at least, continuing even after the flaw was discovered in August 2020.

“It’s difficult to see a definitive fix that is agreeable by the aviation authorities and all going forward,” Boeing customer Air Lease Corp’s CEO John Plueger told analysts on an earnings call Feb 22. “I don’t think that we’re there yet.”

Boeing has been working on the fuselage problem, and two additional potentially hazardous defects that arose since 2019, as it charted plans to consolidate final assembly of the 787 in South Carolina starting next month, at a sharply reduced rate of 5 787s per month.

One senior supply chain source said they will have to cut rate again.

Boeing said last month it expects to resume handing over a small number of 787s to customers later this quarter.

It has an ambitious internal plan to deliver 100 of the jets this year, one person said. Analysts say deliveries are not expected to recover to 2019 levels until at least 2024.

‘OPEN-HEART SURGERY’

But before any jet is delivered, it must go through invasive inspections and costly repairs.

First, technicians must pull out the passenger seats, open up the floor paneling and use specialty tools to measure whether defects invisible to the naked eye are present, according to three people with direct knowledge of the process.

The repair work – already underway at Boeing factories in Everett, Washington and North Charleston, South Carolina – is even harder.

In the bowels of the jet, technicians have to remove multiple specialty fasteners on both sides of the inner fuselage skin, then install newly produced “shims” that fill out gaps and remove the structural dimpling. Workers then replace all the fasteners, re-paint, and re-install the interior, they said.

“It’s like open heart surgery,” one of the people said. “They’ll be retrofitting the fleet for potentially several years.”

(Reporting by Eric M. Johnson in Seattle; Additional reporting by Tim Hepher in Paris, David Shepardson in Washington, and Tracy Rucinski in Chicago; Editing by Nick Zieminski)

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On a retro style milk truck, London entrepreneur chases a ‘zero waste’ future

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On a retro style milk truck, London entrepreneur chases a 'zero waste' future 2

By Natalie Thomas

LONDON (Reuters) – Heralded by the whirr of its underpowered electric engine and the clink of bottles stacked in crates on the back, Ella Shone’s ‘Topup Truck’ started life ferrying morning milk to the doorsteps of bleary-eyed Londoners.

Twenty years on, and the light vehicle known as a ‘milk float’ – once a ubiquitous sight on British streets – is enjoying a second career selling a range of goods and serving the 32-year-old’s quest to rid the city of single-use plastic.

“The fact that I’m driving around in a milk float does a lot for raising awareness in the local area,” said Shone, wearing a black beanie during her rounds in the borough of Hackney last week. “So now I’m operating at almost full capacity.”

Furloughed from her sales job during the coronavirus pandemic last spring, Shone used savings to start her new business, aiming to meet growing demand for household goods free of the plastic packaging used in supermarkets.

Customers book a visit from the ‘Topup Truck’ online and then purchase goods such as lentils, pasta, olive oil, shampoo or washing up liquid using their own containers.

From a low base a decade ago, the market for such unpackaged bulk goods could hit at least 1.2 billion euros ($1.5 billion) by 2030 in the European Union, according to a report https://zerowasteeurope.eu/wp-content/uploads/2020/06/2020_06_30_zwe_pfs_executive_study.pdf by Zero Waste Europe, an anti-waste network.

While handling the logistics can be a challenge, Shone calculates that her service has eliminated the need for at least 12,700 pieces of plastic since it launched in August.

Planning a crowdfunder to retrofit her milk float to enable her to serve a greater range of products to more communities, Shone hopes her novel approach will inspire others to find creative ways to tackle waste.

“If we want to have real change, it has to be a collective effort,” she said.

($1 = 0.8218 euros)

(Writing by Matthew Green, Editing by Rosalba O’Brien)

 

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Lufthansa adds more summer holiday destinations in bet on recovery

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Lufthansa adds more summer holiday destinations in bet on recovery 3

BERLIN (Reuters) – Lufthansa is adding more holiday destinations to its summer flight schedule from Germany in anticipation of a strong rebound in bookings, it said on Thursday, betting COVID-19 vaccines and testing will soon make vacation travel possible.

Germany’s largest airline said it was planning to add around 20 new destinations from Frankfurt and 13 from Munich to locations such as the Caribbean, the Canary Islands and Greece.

COVID-19 vaccines and testing, along with strict hygiene rules at airports and on planes, will be prerequisites for travel this summer, it said.

“We expect many countries to relax travel restrictions towards the summer as more and more people have been vaccinated,” Lufthansa board member Harry Hohmeister said in a statement.

Hohmeister said the airline, which secured a 9 billion euro ($11 billion) state bailout last year, expects a sharp increase in demand once restrictions are lifted.

Concerned about more transmissible coronavirus mutations, many European Union countries have reinstated border controls in what is normally a passport-free travel zone.

“There is a great yearning for travel and we believe that the summer months will reflect this,” Hohmeister added.

In Britain, holiday bookings soared this week after the government laid out plans to gradually relax coronavirus restrictions, giving battered airlines and tour operators hope that a bumper summer could come to their rescue.

Plans for relaxing coronavirus travel restrictions have not been announced yet in Germany. Chancellor Angela Merkel is due to discuss lockdown options with the head of the regional governments next Wednesday.

Lufthansa, which said in January it was losing a million euros every two hours, is due to publish its fourth quarter results on March 4.

($1 = 0.8187 euros)

(Reporting by Riham Alkousaa and Ilona Wissenbach. Editing by Mark Potter)

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