Building A Data Warehouse (1,009 words)
The gathering of data—and the organizing of it—is the first step in building a powerful database marketing system. The power of your system will come when you combine your data with the database systems and tools to maximize the information presented in the data you've gathered. Decision support tools can be utilized to identify customer trends and will provide the summary data about your customers to develop marketing strategies. These tools will produce valuable reports that can be included in your marketing material, as well as what is presented to your company's management. In addition, today's database tools can be set up to automatically send out electronic notifications across the Internet. These promotions or product announcements are triggered by indicators within your customer data.
In addition to knowing that Mary Smith purchases Christmas cards every year, you now know that she also purchases gifts for her children's birthdays (you also know the dates so you can send reminders 30 days prior to their birthdays). You know the sex of her children, so you can recommend gifts. You know that she initially responded to a catalog but seems to ignore all of the other mailings you send, which means you can now reduce your postage costs. However, she's very responsive when you send a special offer that provides her with cost savings. You also know that your savings coupons in the local paper draws Mary to your retail outlet because she uses her preferred shopper card when she checks out. Once she is in the store, one of your trained salespeople can upsell Mary with additional merchandise, providing even greater richness of purchase history data. Wow!
Combined, all of this information allows you to do more customized and targeted marketing—particularly important in this era of increased competition. You can now measure the results of your efforts so you can continually increase your response rates, reduce costs, target current, as well as potential customers, and improve your customer service. You also get a leg up on the competition in terms of which new products—and outlets—will succeed.