What’s Your Value?
March 1, 2006

In today’s multichannel selling environment, there are a number of important analytical metrics that every direct marketer needs to know and constantly measure. Among them: • What is the value of your customer list—today and projected for the next three years? • What does it cost to recruit or acquire a new customer? and • What is your “payback” period—that is the time it takes for a new customer to become profitable? These are critical measurements of the financial health of a company. Let’s look at ways to value your customer list, and home in on the specific customer metric of

Customer Data Mining
February 1, 2006

Customer data mining is a complex process that involves highly trained professionals. Some companies handle data mining in house, while others farm it out, and still others follow a hybrid solution. Which option is right for you? Here are some factors to consider when you’re making this difficult decision. What Can You Afford? Most mid-size to large direct marketers have an in-house data mining department to handle at least some of the analytics work. They feel it’s important to have total control of this critical function, and for the data miners to be continuously steeped in the business. Also, the cost of an in-house staff can

Avoid Information Overload
January 1, 2006

Look to your ultimate business objectives to determine what data is worthy to collect and keep By Irene Cherkassky Common practice suggests that when you start any endeavor, you always should start at the beginning. However, when it comes to data collection, it’s far more advantageous to start at the end. “Trying to decide what data you want without having a very clear picture of what it is you’re trying to do—what are the business objectives—[is like] shooting in the dark,” explains Chris Lucas, vice president of product management for the Sales and Marketing Solutions group at Short Hills, N.J.-based D&B, a global provider

TM0106_Nuts/Book Club
January 1, 2006

Book Club: Let Your Data Do the Driving "Most business models that fail, do so because of a misunderstanding of the customer base," contends data analytics expert and author Alan Weber in his new book, "Data-Driven Business Models" ($49.95, Thomson Texere). This, he goes on to explain, means you should develop your marketing strategies around who your customers actually are, not who you think they are. But that's the rub—how exactly do you find out who your customers are and how they differ from your perceptions? The answer, according to Weber, is data analytics. Throughout this nine-chapter book, Weber discusses—and illustrates through a collection

How Clean Is Your Database?
July 1, 2005

Companies increasingly are placing a high priority on database marketing initiatives. According to the report “In Search of a Single Version of Truth: Strategies for Consolidating Analytic Silos,” released by The Data Warehousing Institute (TDWI) last summer, consolidation continues to remain a top project for businesses. Driving this urge to merge is the “need for consistent data across the enterprise,” as noted by 90 percent of the respondents to TDWI’s survey. Respondents also reported that only about one-third of all the data structures in their enterprise were consolidated. What’s the stumbling block? The TDWI report points to disagreement between company departments on “terms and

Catalog and Direct Selling: Get Them Back
December 1, 2004

... for the second sale It’s the end of the year and you’re probably tabulating the first-time buyer count—how many customers have made their very first purchase this year. And you’re also looking at how many first-time buyers you have overall—customers who’ve only made one purchase in their lifetime. To keep the customer file strong and profitable, these first-time buyers need to buy again next year. But, next year is just days away. What can you do to influence a second purchase? Begin With RFM Planning how to influence the second sale should be part of your overall annual contact strategy. The annual contact

It’s All About the Offer: Time to Pull the Trigger?
November 1, 2004

Technology enables marketers to customize direct mail offers beyond personalization Traditional direct mail personalization techniques allow you to customize communications at the group level, using information such as age, income, location and education. However, these techniques cannot address the fact that every segmentation group is comprised of individuals with very different wants, needs, attitudes and buying behaviors. Trigger programs give marketers added power to act on individually supplied facts about what each customer actually wants and needs rather than statistical inferences. Direct response trigger programs use an individual’s responses to media, input, interactions, purchase transactions and even complaints to deliver a fully customized marketing message at

It’s All About the Offer: Marketing on the Left Side of the Brain
November 1, 2004

Using data, you can focus solidly on the customer -- not the product -- to make more effective offers. Back in the 20th century, sales and marketing geniuses were American business heroes—they built great sales forces that built great companies, and created great ads that built great brands. But during the past 25 years, technology changed the rules. Now and forevermore, marketing geniuses will be guided not by intuition but by predictive analytics. In the future, marketing geniuses increasingly will use an understanding of customer behavior to offer the right product, at the right price, at the optimum time. Forrester Research analyst Eric Schmitt

E-commerce Link: Ensemble Selling Online
November 1, 2004

A time-tested merchandising technique gets new vitality through data-driven personalization methods. A longtime goal of online merchants has been to create a pleasant, personalized shopping experience that encourages purchasing and repeat visits. Another goal of direct marketers is to increase average order sizes online. Ensemble selling—otherwise known as selling by merchandise collections—accomplishes both goals, and has seen widespread use because of its ability to get beyond the structured, linear character of the Web and speak to the emotional issues that drive the shopping behavior of targeted customers. Ensemble selling is so widely used and successful that it is becoming a standard

Modeling Brings New Life to TV Guide
October 1, 2004

Problem: Declining circulation Solution: Build a relational database to support modeling and customer segmentation Result: Better targeted offers boost response to acquisition and renewal campaigns A household name for 50 years, TV Guide was feeling the pain of competing TV listing sources and a subsequent drop in newsstand sales in the late 1990s. Its circulation steadily declined by 20 percent over the course of a decade. But thanks to an aggressive modeling strategy, the tide turned in 2003. With a renewed focus on its subscribers and a relational database, TV Guide’s circulation once again is climbing. In the fall of 1999, Hairong