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Chapter 11 Database and Direct Response Marketing and Personal Selling
This document discusses database and direct response marketing. It covers developing loyal customers through recognition, relationships, and rewards. It describes building a marketing database and data warehouse to store customer information and perform database coding, analysis, and data mining to drive personalized communications and marketing programs. It also discusses direct response marketing techniques like direct mail, catalogs, television, radio, and personal selling and how building customer relationships through a database is important for direct response.
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Chapter 11 Database and Direct Response Marketing and Personal Selling
- 1. Database and DirectResponse Marketing Anisa Osariana 201080016
- 2. Developing Loyal Customers •The 3 R’s • Recognition • Relationship • Rewards
- 3. Database Marketing Building relationships DatabaseAnalytics • Data-Driven Programs • Data-Driven Communications • Direct Response Marketing Identifying customers DATABASE
- 4. Tasks in DatabaseMarketing •Building a data warehouse •Database coding and analysis •Data mining •Data-driven marketing communications •Data-driven marketing programs
- 5. Building the DataWarehouse •Operational database •Customer transactions •Follows accounting rules •Marketing database •Current customer information •Former customer information •Prospect information
- 6. Marketing Data Warehouse •Customernames and addresses •E-mail addresses •Record of visits to the firm’s Web site •History of every purchase transaction •History of customer interactions •Inquiries •Complaints •Returns
- 7. Marketing Data Warehouse •Customer survey results • Preferences and profiles supplied by the customer • Response history from marketing campaigns • Appended data • Demographic and psychographic data (Knowledge Base Marketing or Claritas) • Geocoding (CACI Coder Plus) • Database coding through customer analyses • Lifetime value • Customer segment cluster • RFM (recency, frequency, monetary) analysis
- 8. Database Coding andAnalysis •Personalized communications •Marketing campaigns •Common forms of coding •Lifetime value analysis •Customer Clusters
- 9. Lifetime Value Analysis •Represents the profit revenue of a customer throughout the lifetime of the relationship • Individual lifetime value • Customer segment lifetime value • Key figures •Revenue and costs •Retention rate •Visits or purchases per time period
- 10. Data Mining • Buildingprofiles of customer groups • Preparing models that predict future purchase behavior • Drives • Marketing communications • Marketing programs
- 11. Why the Internetis Important in Customer Communications • Low cost • Available 24/7. • Metric analysis • If the message was read • Time it was read • How much time was spent • Customers access to additional information • Build a bond with customers.
- 12. Why build adata warehouse? Why code data? Why mine the data? • Establish One-on-One Communications • Build Relationship • Repeat Purchase (Customer Loyalty)
- 13. Database-Driven Communications • Identification codes •Customer IDs/passwords • Personalized greetings • After-sale communications • Customer profile information • In-bound telemarketing • Trawling
- 14. Database-Driven Marketing Programs • Permissionmarketing • Frequency/loyalty programs • Customer relationship management
- 15. Steps in Buildinga Permission Marketing Program • Obtain permission • Offer a curriculum over time • Reinforce incentives to continue the relationship • Increase level of permission • Leverage the permission to benefit both parties
- 16. Successful Permission Marketing •Ensure recipients have granted permission • Make e-mails relevant • Customize program by tracking member activity • Empowerment • Reciprocity
- 17. Frequency Program Objectives •Maintain sales, margins, or profits • Increase loyalty of existing customers • Induce cross-selling to existing customers • Differentiate a parity brand • Preempt the entry of a new brand • Preempt or match a competitor’s program
- 18. Frequency Program Goals • Developcustomer loyalty • Matching or preempting the competition • Target higher income households Principles • Design the program to enhance the value of the product. • Calculate the full cost of the program. • Design a program that maximizes the customer’s motivation to make the next purchase.
- 19. Customer Relationship Management • Databasetechnology • Customize products • Customize communications • Many CRM programs failed • Built on two primary metrics • Lifetime value • Share of customer
- 20. Steps to Develop CustomerRelationship Management • Identify the company’s customers • Differentiate customers in terms of needs and value • Lifetime value • Share of customer • Interact with customers • Improve cost efficiency • Enhance effectiveness of interaction • Customize goods or services
- 21. Customer Relationship Management Reasonsfor Failure • Implemented before a solid customer strategy is created • Rolling out a CRM program before changing the organization to match the CRM program • Becoming technology driven rather than customer driven • Customers feel like they are being stalked instead of being wooed
- 22. Direct Response Marketing •Direct Response Marketing is the targeting of products to customers without the use of other channel members • Direct Marketing Association • Prospecting 60% • Customer retention 40%
- 23. Direct Mail • Mostcommon form of direct marketing • Types of lists • Response list • Compiled list • Advantages • Target mailings (consumer, b-to-b) • Measurable • Driver of online sales • Disadvantages • Clutter • Costs • Digital direct-to-press
- 24. Catalogs • Long-term impact •Low-pressure sales tactics • First stage in buying cycle • Database • Specialty catalogs • Business-to-business
- 25. Direct Response Marketing DirectResponse Media • Television • Radio • Magazines • Newspapers Internet • Direct response to ads • Cost-effective • Builds relationships • Personalization of communication • Customization of offer • Search engine ads
- 26. Direct Response Marketing DirectSales • In the consumer sector, several companies use direct sales • The sales person contacts friends, relatives, coworkers, and others and provide them with small catalogs or marketing brochures Telemarketing • Inbound telemarketing • Cross-selling • Outbound telemarketing • Cold calling • Database • Prospects
- 27. Personal Selling • Personalselling offers a face-to-face opportunity to build relationship with consumers • Personal selling should not be limited to simply making sales, but an additional objective should be to develop longer-term relationship with customers
- 28. Personal Selling • Generatingleads • Qualifying prospect • Knowledge acquisition • Sales presentation • Handling objectives • Sales closing • Follow-up
- 29.