How 'green targeting' could save a small fortune

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By: Wise Marketer Staff |

Posted on December 21, 2007

British firms could collectively save over 500 million a year if they used 'green targeting' techniques to more accurately identify the best customers to communicate with, according to a study by The Customer Partnership.

While all marketers have the same basic desire to cut down on unwanted marketing communications, moving from wanting to be seen as 'green' to actually achieving practical results is a function of the efficiency of the targeting strategy.

Green targeting
According to Julian Berry, director for The Customer Partnership, "Our trials with companies in the financial services, mail order, and utility sectors suggest that cost savings of anywhere between 20% and 25% are possible by using individual-level customer optimisation techniques."

In fact, given a total national direct mail spend of over 2.3 billion each year, savings of nearly 500 million a year could be achieved by simply managing customers better. And the environmental benefits are clear, with a significant reduction in the amount of direct mail that doesn't end up in landfill sites.

Gone is the 1% response rate
The Direct Marketing Association (DMA) has recently stated that the existing status quo of direct marketing is no longer tenable and that, given the rising "green agenda", it is now almost impossible for marketers to justify campaigns that achieve response rates of 1% or less - something that has been an accepted industry norm for many years.

Berry concluded: "We all know we should be mailing less, and our work suggests that this not only possible but that it can be done while simultaneously increasing our return on investment."

The Customer Partnership itself has taken a positive step by purchasing the latest Contact Optimizer v3.0 from Alterian, which will enable the company to streamline customer targeting at an individual level, to model potential contact scenarios, and to assess the likely impact on responses and budgets before applying them to actual outbound campaigns.

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