Avoid Information Overload
* How many mailings did it take to get a customer to convert? This will help gauge what it will take to acquire more customers.
* If more than one creative is used to gain new customers, which was more effective?
* What time of year did the customer convert? Seasonality is key to understanding where and when a product or service will be more in demand.
If the focus of your database purely is managing your own customers, rather than acquisition, you must ask which pieces of information are going to significantly impact your ability to increase the value of a customer, says Marsala-Herlihy. Recency, frequency, monetary value (RFM) data are essential to any continuing marketing efforts, she says. As well, understanding the details of the customer’s first interaction with your company is vital. “[In] every lifetime value study I’ve ever done, that first interaction is so telling,” says Marsala-Herlihy. “It’s very predictive long-term, and that’s almost across all industries.” This includes what customers bought, how much they spent, whether they bought across categories, and how many communications it took for that customer to convert.
Much of your decision as to what data are relevant to you will depend on the type of marketer you are. For instance, healthcare marketers, says Marsala-Herlihy, are likely to be more interested in acquisition data, since they are subject to severe privacy restrictions as it relates to using customer information for anything other than what’s necessary to provide the subscribed healthcare services. In comparison, most retailers will be more focused on transactional elements.
B-to-B marketers need to design their databases using similar building blocks. According to D&B’s Lucas, the seven elements essential to any B-to-B database are customer contact information, business name, address, telephone, industry SIC code, number of employees and sales volume. “Many businesses use these [elements] exclusively to do segmentation and targeting,” he points out.