Database : The Center of the Relationship

Capturing preferences is the key to relevance

The days of batch-and-blast marketing are over. Today's savvy consumers want—and expect—the commercial communications they receive to be timely, relevant and based on their previous interactions with the brand or program. They expect marketers to know what interests them and provide customized offers and information based on these interests, both explicitly stated through preference centers and implicitly stated through past purchases and previous interactions. The good news is technology is available to facilitate this activity, and marketers certainly are capable of providing content that meets consumer needs.

The ways of capturing consumer preferences have extended beyond simple opt-in and opt-out pages to far more advanced preference centers that capture and maintain consumer wants and interests over time. Preference centers are a must in today's complicated marketing landscape and provide the prime opportunity to gather as much relevant information about an individual consumer as possible. Some marketers have used them wisely to fill in the gaps to know what subscribers want to receive and when, especially as these companies move to more complicated programs and targeted communications. For example, preferences for transactional messages (shipping confirmations, e-statement notifications) may be very different from regular marketing messages (weekly deals, specials, coupons) and product information (warranties, recalls, upgrades).

Begin With Your E-mail Program
A good place to start is with a map of all the communications your e-mail program supports, against the contact frequency at which those messages are sent. Examine current subscriber preferences and contact frequencies to determine the right cadence of messages. Then use the preference center to allow users to select which programs they receive more of and which they prefer not to receive as often if there is overriding content in the queue.

The key to a successful preference center is efficiently capturing just the information that can be used immediately for content preparation, such as program interests, lifestyle and desired content, without gratuitous data collection like postal address if there is no offline component to the program. As users provide information, an unspoken promise is made that by providing the information, he or she will receive a customized experience. If not, this is a good check to ask yourself: Is this really information we need to collect? That said, subscribers willingly will offer up identification information like name, address or ZIP code to allow marketers to match data behind the scenes. But it must be kept to a minimum and used to demonstrably recognize and cater to each customer individually. Otherwise, it will be seen as a turnoff.

In a recent study Epsilon conducted, consumers not only were interested in content customized to their needs, but in fact wanted companies to personalize content based on their preferences. In particular, for travel and financial services e-mails, people expected content to be tailored to their interests (see chart).

Expand to Other Channels
It is equally important to note that a preference center should be part of a broader multichannel strategy with a database that houses all possible information about each customer, including every touchpoint, such as customer call centers, brick-and-mortar retail, the Web and e-mail. Personally identifiable data can be used to track and connect subscribers to individual identities and households. But consumers will not offer these details as easily if the benefit is not equally transparent. Therefore, marketers need to make it clear how the information will be used and provide clear notice and choice about the data collected—not only to satisfy privacy best practices but also to explain to users the value of providing such insight.

Data Pointers
To maintain a trusted relationship, marketers should only collect preferences that they intend to use in their marketing efforts. These preferences should be aligned with the needs of corporate marketing programs and organizational objectives. Ideally, preference centers should enable users to dictate the nature, content and frequency of the communications they receive. Options should be granular, but not overwhelming, thus giving customers a few choices that make sense. Marketers should clearly state how the data being collected will be used. This statement must be clearly and accurately disclosed and made easily accessible in the privacy policy to avoid confusion and consumer distrust.

Once in place, e-mail preference centers allow marketers to take full advantage of available state-of-the-art e-mail marketing capabilities, such as dynamic content assembly to build highly personalized and relevant communications tailored to the expressed and observed needs and interests of customers and prospects. Building more relevant communications helps minimize complaint rates and increases valuable customer interaction. Not only will customers feel like they matter and are valued, but the communications being sent will have a greater probability of resonating with the recipient because messages contain valuable information. Maintaining a preference center conveys to customers and prospects that they are in control. In turn, this increases the comfort level both in handing over e-mail addresses and in opting out directly with the sender rather than with their mailbox providers via spam complaints.

When you have collected all of this valuable information, there are a number of ways to use it. Behavioral data from e-mail and Web analytics tools coupled with the data gathered from the preference centers enable marketers to build more targeted and relevant e-mail communications tailored around demonstrated interests/behaviors. Perhaps start slowly by customizing "headline" content based on past purchases or Web site visits, and then advance to stand-alone targeted e-mail campaigns to individuals who visited or dropped off of a particular area of the site. Registration reminder, shopping cart abandonment and upsell messages are some of the most effective communications marketers can use. Messages triggered by behavior with content that is dynamically populated by Web site interests and past-purchase behavior also pull significantly higher response and conversion rates than any other message types.

It's How You Use It
While e-mail is a cost-effective tool, marketers still should focus on creating efficiencies within their efforts. Sending millions of e-mails that go unread is much more time-consuming than sending thousands of e-mails that are impactful and relevant. Incorporate e-mail marketing best practices such as segmentation, testing subject lines and content, and personalization.

For example, one B-to-B marketer stands out above the rest with its profile/preference page by including a list of subscriptions that are customizable as well as recommended. On the page, customers can update their profiles and e-mail addresses, unsubscribe from one or all communication options, and receive personalized product information and support. In this case, the marketer provides a great deal of valuable information in one place and allows the customer to easily control what she receives. Again, putting the consumer in the driver's seat creates a level of comfort and keeps marketing communications relevant and timely.

In another instance, a large travel company explicitly asked its customers what offers and vacation types likely will motivate future travel. In addition, the company polled subscribers about their preferred e-mail formats, the type of information they wish to receive, the routes they are interested in and more. This information clearly can change as consumers incorporate new devices, move to different parts of the country, switch e-mail addresses or change interests. Thus, e-mail messages encouraging recipients to update their preferences are vital to the life cycle. Information about airfare sales from New York to Miami likely will go unread by someone living in Phoenix.

Preference centers create many opportunities for marketers to better target their customers and maintain an ongoing dialogue and relationship. However, it's simply not enough to create a preference center. Marketers need to ask for the right information, use it to make messages and outreach efforts relevant, and support this interaction as an ongoing and evolving effort where customers are reminded and encouraged to modify preferences.

Kevin Mabley is senior vice president of strategic and analytic consulting at Epsilon, a marketing services firm headquartered in Dallas. He can be reached at (972) 582-9600.

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