Techniques for improving customer retention

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Records in a database are an organization's greatest asset. Once a customer supports an organization financially, the direct marketer becomes responsible for converting the individual into a repeated source of income. After all, cultivating long-term customers produces a consistent stream of income for the organization without incurring additional acquisition costs.

How can marketers streamline customer retention while decreasing costs of undeliverable or unwanted mail? Effective database management.

Establish a single platform. Marketers' responsibilities span multiple channels of communication from direct mail and e-mail to telemarketing and Web site activity. Storing information gathered by each point of contact in a single, user-friendly environment will optimize the quality of future interactions.

Without a unifying platform to store data, organizational cost and effort in gathering customer information could be duplicated due to lack of communication between departments.

Perform data hygiene regularly. A clean, current file is crucial to a marketer's goal of maintaining contact with past customers. Change-of-address processing (NCOALink) identifies and returns all address updates submitted to the U.S. Postal Service; NCOALink processing should be performed twice a year. Addresses processed through CASS Certified software comply with postal standards, and those processed through the Locatable Address Conversion System (LACSLink) will return 911 address conversions for rural route addresses.

In addition to postal hygiene, individual hygiene - such as deceased processing - will reduce future costs by removing individuals that should not be contacted from the file.

Manage contact information meticulously. Some customers may prefer communication by e-mail, but some would rather receive a few specific direct mail pieces a year. Other individuals do not want to receive free gifts from the organization, but they do wish to receive all other mailings.

The best way to encourage repeated activity from each of these individuals is to honor their requests. By creating and using flags to indicate customers' preferences, the marketer can identify appropriate individuals for all mailings. Since some organizations struggle with high staff turnover, avoid internal confusion by assigning consistent, clean, and universal flags that are easily understood by new employees.

Marketers can focus on achieving concrete goals without dealing with the headaches of database management. By outsourcing these needs, marketers can rely upon vendors for expertise in complex database development, data hygiene, security, and maintenance.

Reputable firms duplicate the organization's data and store it in secure, off-site locations to guarantee backup in case of theft, corruption or general restoration. Backup generators provide these secure facilities with reliable sources of power. Outsourcing to a data management firm also offers a menu of services ranging from data entry to merge/purge and NCOALink processing.

With regularly implemented data management practices, direct marketers can spend less time thinking about controllable factors that affect customer retention, and more time on developing the next successful campaign.

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