Data Mining - From Dust to Diamonds (1,194 words)
Let's see a show of hands: How many of us self-professed direct response marketers cringe at the mention of the ever-popular industry term "data mining"? Jargon such as Response Reference, Relational Data Models, Genetic Algorithms or Breeding the Best Predictors has left countless successful marketing professionals dazed and confused.
Granted, all this technical terminology is enough to give anyone a bad flashback to high school calculus, but contemporary marketers need not feel intimidated by all this techno-talk. The statistical side of data mining certainly has its place and its experts, but most marketing professionals have a much easier time taking a more familiar perspective. Knowing customer purchasing habits—including frequency, price points and preferred medium—remain any marketer's best tools. Armed with this valuable information, you can then create a winning program to cross-sell or upsell your customer file both on the phone and through the mail.
You Must Remember This: A List is Still A List
Start with the fundamental marketing truth: Your customer base is a gold mine, and you can always learn more about it. The simple exercise of taking a hard look at certain critical customer attributes is the first step in the "lay" person's data mining process. How many times have you abandoned a potential direct response campaign because of a "bad" segment's performance in testing? Maybe your database doesn't produce the kind of hard numbers necessary to roll out a large-scale campaign through the mail or on the phones, so you decide to pull the plug and move on to the next program.
Possibly the pitch you had in mind didn't work with the list segment you had to work with. Or perhaps the driving factor in the program's success—say, an incentive to purchase—cuts too far into your margins after allowing for returns and shipping costs. In any case, your program is on the endangered species list, and the records are dwindling fast. Take a step back and consider an entirely different approach. Letting go of an offer that you have tweaked and nudged to perfection can be the toughest step in finding the answer to success. But, as an old song says, that may be the best time to "open a new window."