Database Driven Direct Marketing

1
Database Driven Direct Marketing

• Chapter 3

2
Customer Database Defined

• Customer Database- a customer
• database is a list of customer names to
• which additional information has been
• added in a systematic fashion

3
Objectives of a Customer Database

• To get to know customers better
• To sell different products or services to
  existing customers
• To introduce new products or services
• To distribute information about an upcoming event
  or sale
• To introduce new employees
• And moremuch more!!

4
Types of Data To CollectFor A Customer Database

• Customers Name
• Address
• Telephone Number
• E-Mail Address
• Transaction Data

5
Recency/Frequency/Monetary

• Evaluates customers on mailing lists in reference
  to their transactions over time
• 20 points per each variable
• weights will vary
• See example in text

6
Match Codes

• An abbreviated name/address record
• Allows each record to be matched with other
  records
• A match code is generated for each name on the
  list
• Example Address Derived Match Code
• Ann Stafford 82301SAF930AEX8A3
• 9330 West Arlington Rd
• Alexandria, VA 22301

7
Merge/Purge

• A process using match codes to identify and
  delete duplicate names and addresses
• Keeps house lists from being duplicated
• Can remove names that requested no solicitations

8
Database Maintenance

• Lists are perishable
• Constant control and maintenance is required
• Includes identifying and eliminating any
  duplicate records
• Three categories of database maintenance

9
3 Categories of Database Maintenance

• 1. Nixie removal
• 2. Change of address
• 3. Record status updates

10
Nixie Removal

• Defined mail that has been returned by the
• Postal Service because it is undeliverable as
• addressed

11
Change of Address

• Should be requested through the Postal Service
  (NCOA)
• Promotions that are mailed out to improper
  addresses may result in a financial lost

12
Record Status Updates

• Transaction data
• Marital status
• Deaths

13
Database Security

• Proper Storage
• List Marking salting or seeding
• Discouraging Theft

14
DM Uses of a Database

• Profile Customers
• Retain Best Customers
• Thank Customers For Their Patronage
• Capitalize on Cross-Selling/Continuity Selling
• Develop A Customer Communication Program
• Perform Marketing Research
• Generate New Customers
• and MORE!!

15
Database Enhancement

• Defined Refers to adding and overlaying
  information to customer records to better
  understand and describe the customer

16
Reasons To Enhance a Database

• 1. Learn more about the customer
• 2. Increase the effectiveness of future
  promotional activities targeted to current
  customers
• 3. To better prospect for new customers that are
  similar to current customers

17
Data Enhancement

• External
• Geographic Address
• Telephone Number
• Gender of Head of Household
• Length of Residence
• Number of Adults at Residence
• Number of Children at Residence
• Income
• Occupation
• Marital Status
• Make of Automobiles Owned

• Internal
• Age
• Gender
• Income
• Marital Status
• Family Composition
• Street Address
• E-Mail Address
• Length of Residence
• Size of Household
• Type of Housing

18
Lifetime Value of A Customer

• Customers should be viewed as an investment
• Without customers there is no business
• If a marketing effort results in the acquisition
  of new customers who will generate value over
  time the action is desirable

19
Chapter 3 Case

• Smithfield Foods