Using the Right Kind of Data (2,213 words)
Finding your best customers with the right kinds of data
The tumultuous growth of the Internet has shown that catalogers that traditionally relied solely on print media now have new ways of reaching customers and prospects. However, anything new requires some degree of change: The world of the Web caters to customers' whims and offers to satisfy those desires on demand. That means now is the time for catalog companies to get sophisticated about what they sell and to whom. Can you leverage the information in your database to provide customers with more of the products they want at the right times? What about prospects: Are there better ways to determine if the catalog you just spent $800/M to create will end up in the hands of an interested and responsive person?
Unless your company is a start-up with very little history or you have yet to capture one iota of data since the launch of your first book, you can find out a lot about your customers by simply segmenting the records in your database. With the help of proper modeling techniques, you can find your best customers, identify similar prospects and develop campaigns that maximize your marketing dollars.
Start With What You Know
There are so many variables as to why people buy that you need to use the database to its fullest, asserts Betty Camenzind, a member of the marketing department at Oriental Trading Company, an Omaha, NE-based catalog firm that sells novelty items and decorations in bulk to schools, churches, businesses and consumers.
Order a complete work-up on your files. Find out how your customers break down by ZIP code, demographics, psychographics and RFM (Recency, Frequency and Monetary value).
When it comes to relying on data that will be truly predictive for future campaigns, you want to focus your efforts on meaningful segmentation. This means paying careful attention to contact history and products purchased—actual behavior, says Sam Koslowsky, vice president of strategic analytics for Harte Hanks Data Technologies in New York City. RFM is a staple, he says, but it's not as powerful as past behavior.