How to Find Your Perfect Customer in a Haystack of Prospects
By John Gumas
Most companies strive to ensure that every marketing dollar is spent wisely. So, how do you deliver on a promise of better targeting, increased return and complete measuring of results? For many of our clients, that answer lies within a process called customer analytics.
AN APPROACH THAT'S RIGHT FOR THE TIMES
Customer analytics is a system of calculations that allows companies to leverage valuable customer information already in their possession. It may be the most valuable tool in your marketing arsenal.
IMAGINE YOUR MARKETING POTENTIAL IF YOU COULD DO THE FOLLOWING:
- Identify your best, most profitable buying prospects.
- Profile these best prospects so that others like them can be picked out of the crowd.
- Identify customer segments based on their buying habits, unique needs, purchase timing, etc.
- Determine the best opportunities to upsell each customer segment or increase branding and/or loyalty among your best customers.
- Target prospect segments with custom messages and offers, then measure the results against a control group to roll out the strategy that generates the best response.
- Enhance your database by adding detailed demographic information, securing a list of additional prospects and more.
PAST PURCHASING BEHAVIORS BEAT ANY OTHER METHODOLOGY AS A PREDICTOR OF FUTURE PURCHASING INTENT
All of these insights &mdash and more depending on your specific needs &mdash can be discovered through an analysis of your existing customers and their historical transaction/buying behaviors. Because of its extreme targeting, efficiency and measurability, customer analytics allows you to do more with less budget.
Superior understanding of your customer can drive more effective marketing strategies and create a sustainable competitive advantage.
THE CUSTOMER ANALYTICS APPROACH
The traditional approach to marketing begins with identifying a wide target audience &mdash and targeting that group as a whole. This approach overlooks the multitude of sub-buying groups that, when better understood, can turn a good marketing program into a great one.
Customer analytics data allow companies to reach deeper into the target audience and identify hot, medium and cool prospects before marketing efforts begin. Then, initial marketing resources focus only on hot prospects, with a tailored message designed specifically for them. Phase Two is another targeted campaign aimed at medium prospects with a different message and so on.
THE PROCESS
So, how does one go about doing this? First of all, partner with a marketing or advertising agency that has database analytics capabilities.
Because past purchasing behavior is the best predictor of future purchasing intent, identify useful customer data within your company's existing database or distribution channel. This would include:
- Customer names and other identifiers
- Purchase dates and dollar amounts
- Purchases by product type or category
- Other information such as geography, special requests, upgrades, financing, etc.
This data can come from disparate sources and formats. It is then consolidated into a master database, cleansed and made ready for mining and analysis. Proprietary software then makes unlimited queries possible to determine marketing opportunities.
The results can then be merged/purged against secondary industry or demographic data to provide targeted mailing lists, e-mail lists, and other specific insights such as messaging tactics.
TRACK RESULTS
Customer analytics is a great marketing campaign management tool for tracking and measuring the results of various marketing tactics. You can also update the data regularly and re-evaluate to develop the next successful marketing strategy.
IT'S NOT FOR EVERYONE
Customer analytics can only help companies with access to the right internal customer data. But being armed with this extremely valuable information sets the stage for substantial increases in promotional effectiveness and market share.
July 2007 Builder Architect Edition Issue
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