Maintaining a Healthy Database in a Sick Economy Billy Conway - Group Director
So what is healthy?
Are adding more addresses faster than losing them
Is up to date as close to real time as possible
Are rich enough to gain customer insight and derive actionable segments
Allows you to be responsive to opportunities when they arise
Are made up of customers responding to your marketing messages
Understand Current Health
Understanding your current database
Current annual database growth? marketable?
Current List shrinkage
Time from optin to optout
first campaign optout -> sign up issue
First 30 days complaint rate
Who are most valuable customers and how did we acquire them?
What defines quality? Active? Value? Segment?
Our experience says 80% revenue comes from 20%
Sources of E-mail Acquisition Percentage of Marketers Using Acquisition Tactic Level of Satisfaction Paid search Call center Co-registration E-mail list rental In-person/store event Sweepstakes Newsletter sponsorship E-mail append Own site registration Not Satisfied Very Satisfied Source: JupiterResearch/E-Rewards, Inc. E-mail Marketing Executive Survey (5/06), n = 253 (e-mail marketers, US only) We would also add transactional email to this list!
Key Acquisition Points
First, refine your email proposition
It IS the product
Using Lifetime Value, establish the Cost Per Acquisition
Know who you are after
Make opting in ubiquitous, easy, and compelling
If you can, put customers in control
Use e-mail addresses immediately
Build a business case and plan for each channel
Get the best out of your agencies
Use transactional messaging
Build a flexible standalone opt in page for reuse
Search and Affiliate
Capitalise on other marketing spend
Are their existing dormant addresses anywhere within the business?
Terms and conditions
Measuring age of data
Look at all the sources of your email address – how quickly do they get to you? (say from store, from 3 rd party, from web)
What is the distribution on records last updated?
i.e. 60% older than one year.
List Audit and Hygiene services
Real-time address validation
Then how quickly are you starting a dialogue?
Maximise ROI during the honeymoon period
Third party data plugs the insight gap at the time we know the least about a consumer
Helps explain the “why” for observed behaviours, and target the “who” for new activities
Data Lifecycle Consumer engagement (time) 3rd party data Customer data Useful data Prospect Established relationship
Data Lifecycle by type Quality of Relevance Knowledge Around Preferences (or Availability of Data ) E-mail Data (Soon) Web Click Data Profile Data (perhaps) E-mail Data (Perhaps) Web Click Data Profile Data First Conversion E-mail Data Web Click Data Profile Data First Conversion Few More Conversions E-mail Data Web Click Data Profile Data First Purchase Few More Purchases A Lot More Purchases Phase 1 (Leads) Phase 2 (One-Timers) Phase 3 (Mid/Low RFM) Phase 4 (High RFM)
Third-party sourced data
Third-party sourced data Third-party sourced data
Some Data Acquisition methods
Purchase and Value
Birthday or anniversary trigger
We miss(ed) you trigger
Site visit or purchase
“ Boost” ratio –
revenue/value per post-activity trigger message compared to the revenue/value per average message sent
Commerce results from two consumer responses to marketing:
Demand Generation - A consumer buys something because they were presented with an offer, but otherwise had no intent making such a purchase. Most Marketers use this approach, knowing that someone within the database will be in the market for their offer.
Opportunistic Marketing - A consumer is in the consideration process (e.g. browsing a site) and buys something because they are presented with an appropriate offer before they buy from someone else. If we assume at any given time that only 2% of the database is actively considering what the Marketer has to offer, we must take advantage of that 2%.*
Few Marketers take advantage of Opportunistic Marketing, primarily because they cannot translate consumer behavior into an actionable response fast enough.
The Marketer’s challenge
Complex Considerations How should we best address these behaviors? In what circumstances should we E-mail this person? With what message or offer? Register Browse Checked Golf and Tennis Nike SQ Driver Click Presentation Layer Scoring Layer Behavior Layer Nike Golf Shoes Golf Tennis Golf Tennis Golf Tennis $$$ Nike $$$ Nike 50% 50% 70% 30% 80% 20% 100%
Quick Behavioural Targeting
Abandoned shopping cart trigger
“ Shopping” Triggers
Active Subscriber rate:
Number of subscribers who have opened, clicked or converted in the past six months, divided by the total number of subscribers
Non-responsive Subscriber rate:
number of subscribers who have not opened, clicked or converted in the past six months, divided by the total number of subscribers
Subscriber response rate:
number of times a subscriber responds (open, click, purchase) divided by the total number of messages sent in the time period
Engaged Openers Clickers Unengaged Flirting Gone Clicks 0 1 2-3 4-7 8+ 0 1 2 3+ New Not opened last quarter either Opens
Save, learn or reactivate
Save the customer
Find out why they are unsubscribing
Attempt to reactivate dead addresses
Recap - Databases are:
Growing databases with quality addresses increases the monetised value of your database and justifies investment in relevance
Fresh databases gives you better insight into your customers and gives you a better sense of your real performance
Quick databases allows you to market to customers at the right time i.e. when they are ready
Deep databases with rich customer information gives you better insight and makes it easier to improve the relevance of your communications
Active databases allow you to understand when and what to market to your most interested customers