Today more than ever, building sales figures and maximising ROI is critical, not just for success but for survival. We all know itís a tough world out there. The direct merchants who have invested in intelligent, customer-focused marketing are staying ahead of the pack. The most successful are aligning on and offline, wrapping brand values around the product offerings and using technology to deliver dynamic, relevant communications that optimise their customersí experience.
Creating a bespoke CRM strategy can reveal how to talk to customers; what to say, what channel to use, when and how often. Ultimately, customers buy more if they feel understood and valued, so by making your campaign relevant and timely you will increase your likelihood of getting sales. As CRM and data marketing consultants, we see some excellent--and some less than successful--efforts to engage customers in CRM initiatives. There are many pitfalls, but there are also some simple health checks which can ensure an effective and efficient programme.
So what are the vital signs of a CRM or data-driven communications strategy?
Data gathering and permissions
Are you harnessing all your customers and prospect touchpoints correctly via the web, email, direct mail, in-store, social media, delivery and operations?
Think about each of these touchpoints as an opportunity to learn more from and about your customers and prospects. Itís imperative you gather the right information in the right format. Donít collect data you donít use or can source externally, only ask the questions that help you define future value.
Golden questions--if you had 20 seconds to ask a question of your customer what would it be? Be aware: from their address you can learn all about who they are, their lifestyles and how affordable your products are to them.
Make sure you seek ďall-inĒ permissions from prospects and customers, keep your contact channel options open and get their postal address--it makes all the other jobs possible. You can always give them channel options if they subsequently say no, for instance, ďplease donít email me anymore but post me your catalogueĒ. Email-only or badly permissioned data can render your customer unreachable. Oh, and for those good old phone and postal customers why not buy their email addresses?
A single view
You can only get the full picture of your customers if you have a working ďsingle customer viewĒ database. Get your individual customers into one place, have one household address with different families (surnames) and individuals, prioritise, segment and enhance the data, aligning all transactions and interactions across all your products, brands and channels. It is dangerous to keep your web customers and transactions as a separate group--they donít think about you that way!
How empathetic are you to your customers and prospects? Do you have a thorough understanding of their needs? Itís now time for some analysis; demographics plus Recency, Frequency and Monetary (RFM) values are a great start but now we can add preferred purchase route, gap between purchases, internet behaviour, disposable income and attitude to credit. Letís create some people segments that deliver volume and value for your product range. Simple RFM groups should have different offers; first order, getting the second order, upsell and average order builders or targeted cross-sell, how does each perform within your segments?
Take the time to assess which parts of your customer base to nurture and grow. Are you focusing on the profitable ones? Ask yourself, how you are treating them differently to the rest? Put them in the right order, ranking them from best to worst. Build a propensity model on the area of your business that has the biggest potential to grow or requires immediate focus, as youíll need to be able to target existing customers who have the highest likelihood to repurchase. Which channel brings you the best lifetime value, NOT the lowest cost per order? Review your product range and the mix they buy--this can drive clever incentives.
Loyalty? Or just giving the biggest discounts to the customers most likely to buy again anyway? Once you understand the key characteristics and behaviours of your most valuable customers, you can use that profile to go out and find others, either by buying lookalike data or by targeting your other media more effectively to the people who are going to be most receptive--and responsive. Lead generation is becoming a viable alternative to cold lists BUT donít venture down that route unless you are equipped to react to a lead within hours.
Messaging and the three Rs
Use technology, itís so cheap now there is no excuse for one size fits all marketing. Be relevant; recognise their value and reward their custom.
Dynamic email content, SMS messages and Call Me buttons to your call centre, website pop-ups that welcome, recognise and reward, versionalised letters or brochure wraps, direct mail using clever digital print, personalised offers in the catalogue; you have all these tools available, you just need a clear CRM journey.
One size doesnít fit all and in 2012 we shouldnít be just blasting everyone with the same message; thatís so 2002! Youíll be using all this rich information to create the right message in either email format or with a DM pack for your existing and prospective customers. To save time and cost, you can get by with one design template but split messaging for different customer segments and prospects. And never forget how they are talking to you--post, phone, web--are you reflecting their channel choices?
Look at the customer not the campaign. Now you need to feed all this wonderful information into your database. Take all the prospects and customers, opens, clicks, buys, transactions, order values and abandoned baskets, and make sure you capture the detail on each customer and prospect record. Only when you truly track and record the outcome can you build a customer ROI. Putting the outcomes at an individual level back onto your single customer view database completes the campaign history and enables the analysis of how it went. It provides you with the measurement tools to either fine-tune your campaign or do it all again--only bigger--and plan for the next one.
Pamela Bath is founder and chief executive of Blueberry Wave a CRM and data agency firm.
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