Tuesday, April 7, 2009

How Well Does Your Company Score on 1:1 Marketing Engagement with its Customers and Prospects? 5 questions to help you gauge where your company stands.

Although the term “1:1 marketing communications” was first coined in the early 1990s, only in the past 5 years or so has variable data communications technology come together in ways that make it efficient to develop and deliver these campaigns seamlessly across print, email, web, and mobile channels. Without rich customer and prospect data, however, campaigns cannot move beyond the “Dear John” stage of relevancy. Companies that have developed strategies for collecting and analyzing data have experienced double-digit response rates to data-driven campaigns. Relevancy leads to engagement. And engagement leads to action.
So, where does your company stand? Take the customer engagement survey and find out.

1. Can you provide meaningful information on your customers and prospects in the following areas:

a) Profitability and Lifetime Value. Can you identify your most profitable customer segments and the lifetime value of those segments?
b) Demographics
c) Buying Patterns
d) Competitive Usage
e) Company Size (B2B markets)
f) Communication Channel Preference

Give yourself one point for each yes answer.
From a pure financial perspective, it just makes sense to know which customer segments are providing the lion’s share of profits for your firm. It also makes sense to understanding more about what motivates those profitable customer segments so that you can craft cross-sell and up-sell offers more finely tailored to their needs. Database profiling and analytics can statistically analyze demographic and transactional data from your data base to identify segments with similar characteristics. With this understanding, communicating to those segments with copy and images that relate specifically to their needs can help boost response rates significantly over generic communication.

2. Which one of the following best characterizes the marketing communications that you send to customers and prospects?

a) Highly personalized communication in which content is dynamically generated based on known data about the customer/prospect. (If yes, 2 points)
b) Personalized and use different static versions for different segments. (If yes, 1 point)
c) Simple personalization. Name and address only. (0.5 point)
d) No customization, just “one size fits all.” (If yes, 0 points)

It goes without saying—true data-driven communication requires a different design mindset and copy strategy that leads to more work than sending the same message to everyone. Although one design template can accommodate an entire direct mail campaign, different copy must be written for all the individual segments, along with variable images for even greater impact. The payoff, however, comes with the results. In fact, a study by CapV revealed a 48% increase in repeat orders by using personalized communication programs.

3. Have you ever executed a direct mail campaign tied to a personalized landing page to collect more data on your customers and prospects?

a. Yes (1 point)
b. No (0 points)

Personalized landing pages, or personalized URLs (PURLs) can add a tremendous lift to prospecting campaigns by gathering deeper insights for future campaigns that connect more directly to the prospect’s needs. With a PURL, the recipient of a direct mail campaign is directed to a web landing page with his/her individual name incorporated (www.abcinc.com/tomsmith) . An incentive may be used to get the recipient to go to the page and answer 1 or 2 questions, the answers to which can be used to drive deeper relevancy in future communications. For existing customers, about whom you already have amassed data, the PURL can present the recipient with highly targeted offers.

4 Have you ever appended data to your customer or prospect database from outside data sources?

a. Yes (1 point)
b. No (0 points)

Don’t have any data besides transactional and name/address? There are plenty of companies that sell specific types of data that can be appended to your customer or prospect list. For consumer marketing, many different types of data (demographic, lifestyle, transactional) can be merged and matched with your data for appending. For example, let’s say the development office of a college is looking for high net worth alumnae to target for an annual giving campaign. A publically available database of high net worth individuals (based primarily on an individual’s home address) could be tapped to provide the answers. Valuable bits of appended information such as this can be purchased for as little as $0.10 per record.

5 Have you ever profiled your customer database and used the profile to purchase outside prospecting lists?

a. Yes (1 point)
b. No (0 points)

Once you gain a more multi-dimensional understanding of who your customers are, you can then buy outside prospects lists that mimic them. For example, suppose that a B2B marketing company appends SIC and company size information to its customer data list. It can then run a simple profile to find the top five SICs that purchase its products, along with the average sizes of those companies. Outside lists having these same characteristics can then be purchased. Lead generation campaigns to these prospects can take on greater relevancy when references to industry and company size are incorporated into the copy.

9-11. You get it. Peppers and Rogers would be proud of you.
4-8. There’s still a lot more you could be doing with relevancy to more fully engage your customers and prospects
0-3. Look at it this way—incorporating minimal data-driven practices will boost your results tremendously.