"And the reason I think the word customer is so important is because it helps you frame the level in which you're having this conversation," he continues. "So the truth is, most direct marketers, when they're talking about their activities in their daily lives, they're talking about advertising activity. They're talking about direct marketing medias and how they're targeting those medias to create behaviors that they want—purchase behaviors, engagement, whatever it might be. But if you raise that conversation up a level, you would really raise that conversation up into a marketing conversation vs. an advertising conversation. Now we're talking about all four P's, not just one of the P's. We're talking about a pricing conversation, we're talking about a product conversation, we're talking about a placement or a retail conversation, and lastly, a promotion conversation, which is where advertising would connect to."
Further, Williams says, it's time for direct marketers to mix it up with the brand camp—in a good way. "The single most important issue is that there is an integrated dialogue amongst the primary entities of an organization."
He details three "currencies" that allow an organization to have a common language to use to talk about customers.
- Segmentation, which provides a way to talk about the attitudes, needs and values of customers across the organization.
- A customer value metric, which is an enterprise-level, department-neutral way of organizing around the customers in order to be relevant to them and understand and drive their behaviors over time.
- Incremental measurement capability, which means averages must depart in favor of more accurate customer value measurements. "If I can't measure the incremental impact of the next dollar spent, then I can't truly optimize across dollars available to me," says Williams.
Big Idea: Measure Success by Customer Value
While it took half a decade for the industry at large to catch up, most direct marketers now agree with Martha Rogers and Don Peppers, the founding partners of Norwalk, Conn.-based customer-centric marketing strategy consultancy Peppers & Rogers Group. They think it's important for companies to know who their customers are and to build their businesses around leveraging this insight to better serve them.