SPSS TO FORM ANALYTICAL CRM DIVISION

As reported by Dennis Callaghan, SPSS Inc announced the formation of a new division dedicated to analytical CRM solutions.

Called the CustomerCentric Solutions division, the new SPSS group will market the company's analytical software in combination with services and middleware.

SPSS, a company with more than 30 years experience in statistical analysis and data mining software, introduced an analytical CRM product called CustomerCentric about a year and a half ago.

But the focus of the new division will be on providing complete analytical CRM "solutions" of software, services and what company officials call the "glue" software that creates a user-friendly environment for business users of the software.

A new audience

"Historically, the people in an organization who used our software were analysts," said Susan Phelan, general manager of the Chicago-based company's new division. "But the kinds of people using it now aren't analysts but marketing professionals, middle management and senior executives."

The new division will target deals of $1 million or more. Those deals will involve a large amount of services as Phelan said the solutions will have a "high degree of tailoring" to customize them to each customer's needs.

The CustomerCentric division becomes the third division at SPSS. The company will remain in the statistical analysis and data mining businesses, though the former is no longer a growth area for the company, Phelan said.

Todd & Holland, a high-end specialty tea retailer in River Forest, Ill., is a beta site for the CustomerCentric solution. SPSS analytics forms the basis for the company's Web site recommendation engine, which recommends products to customers based on what customers who have made similar purchases have bought.

SPSS consultants are also analyzing Todd & Holland's customer database to form profiles based on demographics and customer value.

"We want to target the group of customers that's just below our top group, that has the potential to become a part of that top group," said William Todd, president and co-owner of Todd & Holland.

Ultimately, Todd said, the company wants to retain its current customers, sell more to them and acquire qualified new customers.

"We're a small entrepreneurial startup," he said. "We pour the bulk of what we get (in revenues) into marketing, so our marketing dollars are very precious to us. What we want to be able to do is target marketing, so that if we're going to send out a direct mail piece to 50,000 people, using the SPSS technology maybe we can send it to 20,000 instead and have it be more productive."

The company has just begun the pilot program and it's too early for any statistically significant results, Todd said. But he did note that the first two customers who made purchases at the company's Web site after the recommendation engine was installed also bought products that were recommended to them. Todd & Holland plans to extend the recommendation engine technology to the point-of-sale system at its retail outlet in River Forest as well.

"We've been very pleased with them as far as the work they've done," said Todd. "Everything they said they'd do, they produced on."