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Using Database Marketing to Target Loyal Customers: A Small Business Guide

1 Mar

by Joel R. Evans and Barry Berman

As we noted last month, too many firms concentrate on how to woo new customers and do not pay enough attention to what they can do to gain the loyalty and increased patronage of their current customers. One of the ways to improve this situation is to develop a customer database and use it to better communicate with these customers.

WHAT IS DATABASE MARKETING? It is a way of collecting, storing, and using pertinent information about customers. Although customer databases are often associated with computerized management information systems, they may also be used by small firms that are not computerized. 

Here is an illustration of how a small, non-computerized firm can rather easily set up and utilize a customer data base: 

  1. People could be asked for their names, addresses, telephone numbers, and product interests by having forms and pencils available at the checkout counter. They could be encouraged to provide the data by offering a monthly raffle and awarding a low-value prize to the winner.
  2. The customer information gathered in step 1 would be entered onto large index cards. The company would alphabetize the cards and keep them in a filing cabinet.
  3. Once customers have filled out forms, they would be asked for their names on each subsequent trip to the store. Thus, information in the database files would be updated from the sales receipts.
  4. Separate special mailings could be targeted at regular customers and at noncustomers in the database.

By adhering to the preceding procedures, a firm could learn more about its most important customers and treat them better. For example, in many situations, some version of the 80-20 principle probably applies, whereby 80 percent of sales are made to 20 per- cent of customers. With database marketing, a firm could identify those 20 percent and better satisfy them through superior product selection, announcements of special sales, personal attention, etc. In addition, the firm could identify and place heightened emphasis on the next 40 percent of its customers, a group that has often been ignored by companies.

Via database marketing, a retailer could also determine which customers are no longer shopping with that firm and which customers are shopping less often. In these instances, people may be called– in a cordial manner–to find out why they are no longer shopping with the company (or shopping less). Based on the explanations given, the firm could then offer special promotions geared directly to those people.

Research studies have repeatedly shown that people will patronize a firm with which they have been unhappy if they are given the opportunity to voice their opinions (which may be complaints), they are listened to in a courteous manner, and they feel that a firm has responded to their concerns. By no means are those customers “lost causes.” In fact, properly dealing with the customers who have had gripes might lead to even stronger loyalty by them to the firm.

What’s the key to successful database marketing? It must be viewed in a positive way as a beneficial tool, and not as an unwelcome and burdensome chore. KNOWLEDGE IS POWER; AND POWER LEADS TO PROFITS.
 

Marketers Need to Know: Is This End of the Facebook Free-For-All for Brands?

13 Feb

Facebook now derives several billions a year from its advertising fees to companies. But the rules keep changing. Are you prepared for what’s next?

According to Dayna Rothman, writing for Marketo:

“Ah Facebook, you never know what’s coming next! Facebook continues to change their newsfeed algorithm, making it increasingly difficult for brands to reach their fans through organic posts, forcing marketers to rethink their approach to social media. With many of the new Facebook updates and focus on user privacy and preference, organic reach continues to fall short. If you are a large brand only 2-8% of fans actually see your posts and only .073% of brands’ fans actually interact with these posts! Facebook says that these changes are in the interest of keeping users happy, but at the same time, Facebook’s ad revenue continues to climb — are paid ads a marketer’s only hope?”

“Take a look at our infographic as we explore the relationship between Facebook and brands. Is it the end of the Facebook free-for-all? And if so, what can we as marketers do about it?”

 
The End of the Facebook Free-For-All for Brands

Brought to you by Marketing Automation Software by Marketo

 

Understanding “Proximity Marketing”

11 Feb

Here’s another term for our marketing toolbox: proximity marketing. Do YOU know what this is and why we should grasp this concept?

As Marketing Tech Blog explains it:

Proximity marketing is any system that utilizes location technologies to directly communicate with customers via their portable devices. Uses of proximity marketing include distribution of media at concerts, information, gaming and social applications, retail check-ins, payment gateways, and local advertising. Proximity marketing isn’t one single technology, it can actually be implemented utilizing a number of different methods. And it’s not limited to smartphone usage. Modern laptops that are GPS enabled can also be targeted through some proximity technologies.”

To learn more, take a look at this infographic from the UK’s Choice Loans.
 

 

Internet, Social Media, and Mobile Usage Statistics from Around the Globe

30 Jan

We Are Social is a global conversation agency located in Singapore, New York, London, Paris, Milan, Munich, Sydney, and São Paulo. It has put together an OUTSTANDING slideshow with “more than 350 infographics, including global snapshots, regional overviews, and in-depth profiles of 30 of the world’s largest economies.

Take a look at this slideshow.
 

 

How Do College Students “Connect” with Brands?

27 Jan

Marketers today recognize the enormous buying power of college students and very much want to gain their attention and patronage. But are marketers able to “connect” with college students through media channels which they most favor?

As eMarketer puts it:

“Amid their interest in millennials, marketers look to the 19 million-plus U.S. college students as an audience worth courting. After all, it is a mostly millennial subset that already deploys considerable spending power and (with degree in hand) will be poised to outearn and outspend noncollege millennials for decades to come, according to a new eMarketer report, ‘U.S. College Students 101: Updating Fundamental Facts About This Diverse, Digital Cohort.’”

“Regardless of medium, advertising is just one of many influences on students’ purchase decisions, and not the most important. When an August 2014 Fluent study asked students to say what shapes their back-to-school purchase decisions, the top of the list was populated by peer opinion and money-saving offers.”

Click the chart to read more.
 

 

A Look Back at Some WAY Off Predictions

26 Jan

Last week, we posted about JWT Intelligence’s 100 best predictions for 2015.

But how about some past predictions by others that really turned out to be wrong? Take a look at this infographic.
 
TheFutureThatNeverHappened13FailedPredictionsThatCouldntHaveBeenMoreWrong_52f3d195d2fa1_w1500
 

JWT Intelligence’s 100 Key Predictions for 2015

23 Jan

Each year, JWT Intelligence offers 100 interesting trends to be aware of for the coming year. Here are its 2015 predictions.
 

 

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