Panel: Digging Money From Your Data
NEW YORK -- A panel of marketing and list experts at the Direct Marketing Association's List Vision conference Aug. 16 cited five areas where marketers can enhance their data and increase their revenue.
These involved mining internal data, evaluating data for development, minimizing risks with promotions, selecting the right data to collect in enrollment and how to identify new sources of mailable names.
"We recommend for our clients to use third-party data, data mining and to make sure that metrics are available to evaluate and test these analytic tools," said Don Austin, director of client strategy at May Development Services.
Tracking transactions is key when deciding which clients are in danger of becoming inactive, Mr. Austin said.
For online transactions, marketers should look for indicators of long-term value. Most shoppers are satisfied with their first purchase and are more likely to have longevity if they purchase a slew of items.
However, consumers are less loyal in online purchasing. They often shop around for the best deal on various Web sites before buying. Therefore, when in doubt, test and test again.
"Every mailer needs to do their own testing to determine their score group," said Marijke Bekaert, director at HCI Direct. "This is especially true when you have to decide whether or not to reactivate a failed group."
Multichannel marketing should be embraced in the form of e-mail updates. This should go hand in hand with customer retention and adding e-mail to those efforts.
"We need to drive communication on a proactive basis, which will result in improving list rental rates," said Johanna Rivard, managing director at Ziff Davis Internet Group.
Ms. Rivard said that companies could improve list rental revenue by adding firmagraphics such as number of employees, sales volume and business/industry and also by adding demographics such as job function, gender and household income.
"We will be able to mail deeper into our score classes while maintaining our profit levels," she said.
The DMA is in the process of compiling deceased and bankruptcy files to assist companies further.
When doing promotions, organizations must avoid lists with poor payment rates and ensure that the house file models maximize their front- and back-end profitability.
"There is no such thing as an average customer, and all lists are not created equal," Mr. Austin said. "There are lists that have a horrible long-term value, though the upfront response rate is high, so clustering and then pulling the names out of the databases will work best for you."
A challenge to this method, however, is that direct marketing doesn't have enough names as it used to.
"We have to loosen up our tight selects and go deeper into lists and databases," Ms. Bekaert said. "Finding names isn't an easy thing, so you have to work at preserving it."