Wasteless marketing thanks to customer data analysis

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By: Wise Marketer Staff |

Posted on January 27, 2009

Wasteless marketing thanks to customer data analysis

In an environmentally-challenged world it's not surprising that there is a lot of interest in waste, and this principle applies just as much to the marketing department as any other, according to Lance Walker of Fly Buys, New Zealand.

Whether it's recycling rubbish at the roadside, or people carrying groceries in their own bags instead of using vast numbers of new plastic bags, evidence of consumer concern over the environment is everywhere. As Walker points out, this concern is not limited to eco-conscious consumers: It applies equally to cost-conscious executives.

One area in which almost every business can save on waste - and therefore lessen their environment impact - is to change the way they communicate. For example, most consumers watch hours worth of television commercials promoting products that they'll never buy and waste time opening direct mail that won't interest them.

On the corporate side of this equation, marketers are wasting millions of dollars sending messages that effectively fall on deaf ears. If this waste could be measured in physical terms - perhaps in terms of failed mailers or even the TV carbon footprint - the metrics and their financial meaning would certainly be horrifying.

According to Walker, "It all comes down to a single word: relevance. Or, more accurately, a lack of it. Even if consumers are prepared - or even resigned - to wasting time consuming messages that aren't relevant to them, spare a thought for businesses. In difficult economic times they need to reach customers more than ever, but they really can't afford to waste anything. They need to make sure their messages are relevant every single time."

For decades, marketers have talked about the need to mass-broadcasting their messages and to start talking with customers on a one-to-one basis, treating each customer as an individual. This means offering customers something that's both useful and relevant, and ideally at exactly the right time. But achieving this goal requires a deep understanding of the 'who', 'why' and 'what': who you're talking to, why they'd want to listen, and what you'd like them to do or think.

The key, Walker says, lies in customer information. Ideally that information will be multi-dimensional, gathered from transactional and loyalty programme data, geo-demographics, preferences, and attitudes. Some of the data will be quantitative and some will be qualitative, but the richer the data, the better the chance of understanding what it is that motivates individual customers.

Fly Buys uses this level of customer data in three ways:

  1. To develop relevant communications and offers;
  2. To analyse and predict how customers might behave in the future;
  3. To respond to events in the customer's life.

"If we know the customer likes a particular brand or product then we can ensure we talk to them about that brand or product rather than one they don't like," explained Walker. "This means that if a customer does one thing, we can respond in a relevant way, and if they do something else, we can still be relevant in our response. This means they always get an offer that is likely to meet their needs and that is relevant to them at that moment."

Over the past six months Walker has developed a data management and mining tool to help companies understand what's really on consumers' minds. If the company sees that a particular customer may be in a phase of their life where they need a new product or service, it can try to meet that need. For example, if you a customer is intending to travel during the next six months, Fly Buys simply makes sure that they receive several relevant travel offers. "It's this relevance that's the key to minimising communications waste, and it's in-depth customer information that makes this kind of relevance possible," Walker said.

"In the consumer markets of the near future, this is no room for failing to understand exactly who you're talking to, why you're talking to them, why they'd want to listen to you, and what you'd like them to take away from the conversation," concluded Walker.

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