Savvy companies in Richmond are capturing information every time a customer comes into contact with any of its departments. The touch points include a customer purchase, a customer requested service call, an online query, or mail-in rebate card. These data are collected by the company’s contact center and organized into a data warehouse. Company personnel can capture, query, and analyze the data. Inferences can be drawn about an individual customer’s needs and responses. Telemarketers can respond to customer inquiries based on a total picture of the customer relationship.
Through datamining, marketing statisticians can extract useful information about individuals, trends, and segments from the mass of data. Datamining involves the use of sophisticated statistical and mathematical techniques such as cluster analysis, automatic interaction detection, predictive modeling, and neural networking. It can be ideal to run datamining alongside online marketing done by an elite internet marketing company. A company that wants to learn the most from its database needs to engage the services of a person of company skilled in datamining.
Using the Database
In general. companies can use their databases in five ways:
To identify prospects. Many companies generate sales leads by advertising their product or service. The ads generally contain a response feature, such as a business reply card or toll-free phone number. The database is built from these responses. The company sorts through the database to convert them into customers.
To decide which customers should receive a particular offer. Companies are interested in selling, upselling, and cross-selling their products and services. Richmond, Virginia-based companies set up criteria describing the ideal target customer for a particular offer. Then they search their customer database for those who most closely resemble the ideal type. BY noting response rates, a company can improve its targeting precision over time. Following a sale, it can set up an automatic sequence of activities: One week later, send a thank you note; five weeks later, send a new offer; ten weeks later (if the customer has not responded), phone the customer and offer a special discount.
To deepen customer loyalty. Companies can build interest and enthusiasm, by remembering customer preferences; by sending appropriate gifts, discount coupons, and interesting reading material.
To reactivate customer purchases. Companies can install automatic mailing programs (automatic marketing) that send out birthday or anniversary cards, Christmas shopping reminders, or off-season promotions. The database can help the company make attractive or timely offers.
To avoid serious customer mistakes. A major bank confessed to a number of mistakes that it had made by not using its customer database well. In one case, the bank charged a customer a penalty for late payment on his mortgage, failing to note that he headed a company that was a major depositor in this bank. He quit the bank. In a second case, two different staff members of the bank phoned the same mortgage customer offering a home equity loan different prices. Neither knew that the other had made the call. In a third case, a bank gave a premium customer only standard service in another country.