When Not to Model (1,934 words)
NOT ENOUGH LIFT?
On the other hand, for most products and services, modeling does not provide sufficient lift to justify the expense. Thousands of companies have experimented with modeling and come away dissatisfied and somewhat poorer.
Why is that? In many cases, the factors that lead people to buy your product do not depend on data that you can buy to append to a prospect file. Often, modeling is not successful with the marketing of automobiles, packaged goods, fund raising, home sales, clothing, gasoline, furniture or hardware because rented data factors are less important than non-rentable factors in the decision-making process.
Buyers can be classified by two types of characteristics:
• who they are—demographics.
• what they do—behavior.
Some people buy books and read them; most people do not. Do the readers buy books because of their age, income, presence of children, or home value? Or do they do so because they bought books in the past and enjoyed them? In most cases, past behavior is a far better predictor of future behavior than any demographic factors that you can assemble about a group of prospects. That is why "mail responsive" lists are far more profitable for direct marketing than any other type of list that you can buy.
Mail Responsive Lists
To sell its $15 allergy-free air filters by mail, 3M purchased a large list of people who were known to suffer from various air-borne allergies. It asked a direct mail expert whether the project would be a success.
"No," he replied.
"Why not? These people need this filter!"
"You should use a list of mail responsive people. People who have bought something, anything, by mail that costs $15 or more."
"But these people may not need a filter," the 3M guy said.
"Trust me. I know what I am doing," the expert said.