Eight ways to use that left-over holiday sales data
Christmas 2005 was a successful period for internet shopping, with some experts suggesting that some 22 million people in the UK bought products online, spending some £5 billion in the process. But what can online retailers do with the vast amount of data generated in the process, asks distance shopping fulfilment firm Zendor.
With the holiday shopping season over, a massive increase in online shoppers has left retailers with a wealth of consumer data which, if used effectively, could help segment databases and target customers for future sales campaigns. For those retailers that find their database systems creaking under the weight of that data, Zendor offers some simple ideas on how to make use of it throughout the year:
- Profile the customer Your customer database should hold data on each customer such as demographics, spend levels, age and purchasing behaviour. Getting to grips with this information will allow you to communicate in a more focused and effective way and, ultimately, reduce your chances of wasting time and resources targeting individuals who are unlikely to respond to future offers.
- Highlight the gifters There are many consumers who will only buy from a retailer at specific times of the year. A good example of this is someone who purchases a children's toy for a relative at Christmas but does not have any children of their own. By identifying these gifters, you can highlight them in your database to approach next season and also send out test mailings that may prompt a further purchase at other times of the year (for example, by identifying key dates in their diary).
- Avoid the blanket approach Contacting customers in bulk with generic e-mails may seem like a cost-effective option. But it actually does very little to enhance customer relationships in the long run. Communicating with the customer on a one-to-one basis creates an understanding of that customer, and allows you to recognise which offers they are most likely to respond to.
- Interpret the data This will add meaning to the information held in your database, and allow you to analyse the most profitable customers - and those who are more likely to respond to any marketing communications you choose to send out.
- Modelling and segmentation By statistically modelling customers, you can group and rank them into segments based on current and future expected worth.
- Build a contact strategy for the New Year Contacting customers through a targeted approach will often result in improved retention, and lead to higher spend levels later on. Using a contact strategy will enable you to contact a customer at the most effective time and through the most appropriate channel, ensuring that your marketing investment is not wasted.
- Use the data to support other operations Customer data can be used in various ways other than direct marketing. For example, understanding your customers can help you to formulate further strategies and merchandising opportunities, by identifying important aspects such as which products are essential for the coming year.
- Think about outsourcing This is often an option for retailers that don't have the in-house expertise to analyse their own data. Outsourcing to a database analysis expert can yield a better return on investment than employing in-house specialists to do the job.
According to Zendor, by making full use of the data gathered over the past few months, retailers can help ensure they don't miss vital marketing and profit opportunities during the following year, and particularly for the next holiday shopping season.