Peppers uses a customer’s experience with a financial services firm to illustrate the cost of irrelevance. The firm had a good reputation; it was highly recommended. It used this fact as a selling proposition. However, in interviews with customers, Peppers learned that many who’d previously recommended the firm to friends had stopped. Why? Because the firm started sending offers that had no relevance for these customers. While they still use the firm, these customers no longer refer friends. Curiously enough, this firm now pays a bounty for referrals.
Says Peppers: “The cost of over-solicitation is that the lifetime value of customers has decreased.” This decrease in customer referrals has eroded the firm’s asset value, which probably is not measured or tracked. “Marketers need to determine a metric to measure this cost the same way they measure profit,” he adds.
5. Be specific.
“The biggest mistake many marketers make is to try and get broad permission,” Mayor laments. By requesting permission for specific types of communications, Mayor suggests marketers will improve both the number of consumers who give permission as well as response rates.
Hamilton concurs, and advises marketers doing outbound telemarketing campaigns to not only be specific about the products they’d like to call them about, but also to be specific about frequency. If you market auto insurance, for example, Hamilton suggests mailing consumers and asking permission to call them twice a year with a quote that will save them money. “Give them control,” says Hamilton. “Ask what day of week and time of day is most convenient to call.”