Behavioral targeting can be magic bullet to drive profit

Share this content:
Rick Witsell
Rick Witsell

If you could identify which names in your next mailing are likely to become high lifetime value customers — and which aren't — would you change your deployment strategy? 
That's the idea behind optimizing campaigns through list scoring. Accessing a large source of behavioral performance data with the right predictive model can have a dramatic effect on mail campaign profitability. 

The trick is to model consumers for desirable behaviors, such as "likely to buy multiple times." With high mailing costs, generating one-time response is not enough. Behavioral segmentation strategies let marketers identify consumers who will develop long-term, continuous-buying relationships.

A predictive model targeting behaviors that drive profit — not those that drive response — can let you redirect outbound campaigns toward higher lifetime value customers.

Creating a behavioral insight generator does not require dramatic changes in planning, costs or scheduling. Experienced marketers have detailed histories on a large number of lists, demographic segments and "recency, frequency and monetary" variables. Most marketers already deploy models designed to identify "look-alike" or "responder" types. 

Creating a model that targets profitable behavior simply requires different data and a new mindset. It means sharing P+L metrics with the model development team so they can identify profitable behaviors. Armed with this custom-developed model, marketers can make profit-driven decisions before a single envelope hits the printer, including: 

• Which names to promote and which to suppress 

• What offer(s) to make — a higher price point could mean more revenue from high-ranking customers, or a more valuable premium could stimulate response

• Find more consumers to market to — many marketers increase their mail-able universes by targeting top-performing names within expansion segments and marginal list sources

Thinking in terms of behavior versus response is helping sophisticated marketers generate higher rates of net profit on campaigns — increases of 20% and more are not uncommon. Marketers who are willing to think differently about how they target consumers will be driving innovation within their multichannel efforts and reaping the rewards.


Next Article in Direct Mail

Sign up to our newsletters

Company of the Week

Brightcove is the world's leading video platform. The most innovative and respected brands confidently rely on Brightcove to solve their most demanding communication challenges because of the unmatched performance and flexibility of our platform, our global scale and reliability, and our award-winning service. With thousands of customers and an industry-leading suite of cloud video products, Brightcove enables customers to drive compelling business results.

Find out more here »

Career Center

Check out hundreds of exciting professional opportunities available on DMN's Career Center.  
Explore careers in digital marketing, sales, eCommerce, marketing communications, IT, data strategies, and much more. And don't forget to update your resume so employers can contact you privately about job opportunities.

>>Click Here

Relive the 2017 Marketing Hall of Femme

Click the image above