Direct Selling: Straight to the Source
Four marketers use customer research to their advantage
July 2007 By Jack Schmid
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Catalog and Internet marketers historically have pooh-poohed the use of customer research. The reasons for this disdain are numerous. Here are some of the excuses I’ve heard:
• We don’t need it.
• Research won’t tell us anything we don’t know already.
• It’s too expensive.
• Direct marketing is really better than research; let’s just test and read the results.
But thinking about research is changing. Direct marketers always have prided themselves on knowing and understanding the analytical side of their business. They know what happened with every mail or e-mail campaign and can accurately spew metrics on direct mail, catalog mailings, Web performance, search engine optimization or e-mail campaigns. It’s too bad that these same marketers often have little clue as to why customers respond to one marketing effort and not another. Customer research can help multichannel marketers know their customers better and learn how they’re perceived by various customer segments.
What do today’s multichannel marketers want and need to know about their customers? Here’s a list of critical customer information I would want to know about my customers beyond the recency, frequency, monetary and product category information I can extract from my database. Each item on this list is followed by a real case study to demonstrate how the marketer used research to its advantage.
1. How did the initial transaction go for first-time, new-to-file buyers, and what is the likelihood that they will return for a second purchase?
An electric utility that sold consumer products via its catalog and Web site wanted to know how well it had done in receiving initial orders and fulfilling product. To control expenses, the utility opted for a one-page, two-sided bounceback in all box shipments to new-to-file buyers who had purchased by phone or mail. Web customers received the same survey via an e-mail. The research asked questions pertaining to:
• Ease of placing the order (via phone or Web).
• Knowledge and courtesy of phone operators in answering questions.
• How various aspects of merchandise, pricing/value, shipping and handling charges, etc., compared to other catalogs from which customers had ordered.
• Ease of navigation of the com-pany’s Web site.
• Likelihood that customers would return to purchase again.
• Key demographic information pertaining to age, gender, education, marital status, presence of children at home and household-income level.
The reverse side of the bounceback was stamped with a business reply indicia so customers simply could fold the survey and mail it back to the company. The response rate consistently was in the 30 percent range for phone and mail customers, and slightly higher for Internet customers.
• We don’t need it.
• Research won’t tell us anything we don’t know already.
• It’s too expensive.
• Direct marketing is really better than research; let’s just test and read the results.
But thinking about research is changing. Direct marketers always have prided themselves on knowing and understanding the analytical side of their business. They know what happened with every mail or e-mail campaign and can accurately spew metrics on direct mail, catalog mailings, Web performance, search engine optimization or e-mail campaigns. It’s too bad that these same marketers often have little clue as to why customers respond to one marketing effort and not another. Customer research can help multichannel marketers know their customers better and learn how they’re perceived by various customer segments.
What do today’s multichannel marketers want and need to know about their customers? Here’s a list of critical customer information I would want to know about my customers beyond the recency, frequency, monetary and product category information I can extract from my database. Each item on this list is followed by a real case study to demonstrate how the marketer used research to its advantage.
1. How did the initial transaction go for first-time, new-to-file buyers, and what is the likelihood that they will return for a second purchase?
An electric utility that sold consumer products via its catalog and Web site wanted to know how well it had done in receiving initial orders and fulfilling product. To control expenses, the utility opted for a one-page, two-sided bounceback in all box shipments to new-to-file buyers who had purchased by phone or mail. Web customers received the same survey via an e-mail. The research asked questions pertaining to:
• Ease of placing the order (via phone or Web).
• Knowledge and courtesy of phone operators in answering questions.
• How various aspects of merchandise, pricing/value, shipping and handling charges, etc., compared to other catalogs from which customers had ordered.
• Ease of navigation of the com-pany’s Web site.
• Likelihood that customers would return to purchase again.
• Key demographic information pertaining to age, gender, education, marital status, presence of children at home and household-income level.
The reverse side of the bounceback was stamped with a business reply indicia so customers simply could fold the survey and mail it back to the company. The response rate consistently was in the 30 percent range for phone and mail customers, and slightly higher for Internet customers.
Companies Mentioned:
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