CRM Issues Sweep Canadian DM

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TORONTO - In Canada the buzzwords in retail are the same as the buzzwords in just about any industry these days - Customer Relationship Marketing and dot-com.

The Canadian retail landscape has undergone some massive changes over the last few years. The introduction of mammoth Walmart, the demise of the mainstay Eaton's along with other Canadian retailers previously deemed to be untouchable, has left remaining retailers either badly damaged or enjoying the spoils.

In the midst of this significant change, one undeniable element binds retailers together - the need to anticipate customer needs through database driven strategies.

Consider the exponential growth and interest that Canadian retailers have shown in recent years towards response modeling and customer profiling. In addition to this, retailers such as Sears Canada have redesigned themselves building multichannel retail networks, which include stand-alone furniture stores, catalogs and a significant Internet presence. As reported recently in the Toronto Star, Paul Walters, CEO of Sears Canada, is quoted as saying, "the future lies with understanding the buying habits of individual customers."

Relatively new players in the burgeoning big box bookseller segment such as Chapters and Indigo have revolutionized traditional book sales in Canada both at the retail level and online. At the same time, smaller independent booksellers are going into receivership in an effort to regroup and reorganize.

Diane J. Brisebois, president/CEO of the Retail Council of Canada, a not-for-profit, industry-funded association with more than 8,500 members, says, "independent merchants tell us their success lies in a stronger understanding of product merchandising and excellent customer service." Brisebois concludes that, "many of them agree you can't compete solely on price - you must improve the value to the customer."

It seems logical then that a major challenge faced by retailers is to not only maintain but grow their current customer base. Now that most retailers accept many credit cards other than their own, another challenge is to attract the customer to one credit card using an affinity program.

Many retailers have basic information that will allow them the opportunity to study their customers through their shopping habits as recorded on their credit card purchases. Tracking the history of the customers helps the retailer to forecast upcoming trends.

When the retailers' databases are not providing enough information for proper analysis or the information is dated and seemingly unusable, outside sources can be called upon to help.

Database solutions companies offer a wide variety of products, which can benefit retailers in their marketing efforts with both current and prospective customers. Using teams of expert programmers and innovative thinking, they are specialists in launching new products and new techniques for direct marketing in Canada.

These companies can clean data, verify records, and do NCOA, updating the client's database and creating a usable marketing tool. They can provide retailers with prospects that mirror their best customers, and they can provide them with the names of non-customers in their prime market areas.

These solution-minded teams are adept at merging databases, appending information, overlaying data, studying the results, and analyzing the data, all to provide the client with new knowledge about their customers or potential customers.

The analysis should include profiling of existing databases, modeling, and GIS to provide recommendations that help a client to reach their marketing objectives.

Specifically, GIS can help retailers identify marketing opportunities within their individual store trading areas. Areas for both high penetration and low penetration of customers can be approached with separate strategies for prospecting such as addressed and unaddressed mail for the different types of areas.

List brokerage departments can also work with retailers who may be looking at direct mail or alternative media to drive traffic into their retail outlets, measure market activity or take their first steps into cataloging. Executed correctly, retailers and packaged goods companies have not only successfully identified where their current market exists but also areas that may be underserved.

As an important consultant to a retailer's marketing strategy team, the broker can offer a wealth of expertise in the selection and targeting of direct response media prospects. These experienced professionals conduct invaluable research and draw on extensive resources to help retailers reach the hottest prospects and ensure vigorous response. But it does not end there. A good broker will provide not only the media sources with the highest potential for response, but provide extensive analysis and interpretation of campaign response.

It seems inevitable that change will continue in the Canadian retail market as significant forces continue to play themselves out. In the midst of this change, many retailers have already made smart use of the services offered by database solutions companies as well as direct response media brokers in order to help them stay on top of the latest marketing wave.

"Retail is on a roll," remarks Brisebois. "An increase in confidence, more people working and healthier paychecks mean it's finally fun to go shopping again. Consumers appear to have the money to buy a little extra for themselves, their families and their friends." Catch the wave.

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