Turning Hits Into Marketing Intelligence

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What do your customers want? Whether you're a large multi-channel retailer or small specialty Web merchant, the ability to successfully answer that question is central to everything you do. Yet, on second examination, is the question, as phrased, answerable? Larger enterprises generally have more diverse merchandise, a more robust business and less generalities one can draw about its customer base. Moreover, most companies recognize that their profitability hinges more on retaining a core of loyal, repeat, high-end customers than a horde of off-the-street traffic.


To make this a meaningful exercise, let's restate the question: What do your most profitable and reliable customers want?


Across industries and channels, there is a customer-relationship management trend to better understand and serve customers, and segment them into distinct demographic and marketing groups. Large corporations are installing million-dollar data warehouses and special CRM applications that track customer activities across the enterprise, collecting data at all touch points.


These closed-loop systems continuously update the company's knowledge base about key customers. This information can be shared and used throughout the organization to personalize and enhance the customer experience. Not only can companies customize services and product offerings, they can concentrate their marketing resources and time on strengthening relationships with their most profitable customers rather than marketing to the masses.


No media lends itself to analyzing customer behavior and personalizing services better than the Internet. New online technologies provide sophisticated analysis of Web traffic to determine who your online visitors are, what they experience, how they move through your site, and their interests and preferences. Recommendation engines, powered by personalization software, provide customized purchase and service offerings.


Below are some of the services and tools available to help Web marketers understand who their customers are, how they segment, how often they visit, where they come from and what turns them on. With profile-driven Internet marketing solutions, you can reach precise audiences for optimized ROI and performance. The Web traffic auditing and analysis applications also can measure the performance of a banner ad or a marketing campaign, and chart your site's performance against industry benchmarks.


Getting to Know You


Small stores and service establishments have a distinct advantage. Over time, the shop owners and their staff get to know the regulars by sight, greet them by name and learn what they like and order. This friendly, highly personal interaction has shaped our experiences as customers, and sets our expectations about good service and helpful sales advice.


Needless to say, the ability to spot a preferred customer walking through the door is much more difficult for large department stores, national franchises and major service providers. These big organizations have devised marketing strategies enabling their best customers to identify themselves, typically by using premium services such as VIP-only service windows, restricted toll-free numbers, high-bonus reward programs or a special-status credit card.


Online interactions with customers add a whole new level of complexity to identifying top-tier customers and rewarding them with personal service and expert recommendations. Most Web sites are not equipped to distinguish the person behind the click. Therefore, while they have a lot of raw data about numbers of visitors and what information was requested, the individuals performing these activities remain a mystery.


Let's look at the raw data. Web servers create log files. These files record every visitor activity that occurs on the Web site: a request for an HTML page, to have an active page executed or a graphic downloaded. Each of these activities is called a hit. Every request for information is recorded with an IP address, the type of browser used, how the visitor found the site, what he asked for and when.


Technology allows you to access, mine and interpret this dense site-traffic data. A host of online traffic and analysis solutions can turn a Web site's click-stream data into meaningful market intelligence.


Traffic measurement in its basic form is the hit counter. Free versions of traffic counters abound but are of limited use. They display a running total of visitors in a small box, which only has meaning to you since the installer designates the starting number - "Um. 1 million is a nice round number."


A new generation of traffic counters provide accurate real-time information about site activity. Web Side Story, San Diego, has a subscription service that monitors traffic on a page and breaks down the page views into useful categories, such as unique visits, reloads and return traffic. The site activity can be viewed in graph form by traffic type or time frame.


While traffic counters can provide a broad overview of site traffic, you are still left in the dark about the identity and interests of the visitor who felt compelled to return twice within an hour. That probably is someone worth getting to know better. Now you can with the sophisticated class of Internet traffic-analysis tools.


These comprehensive Web site analysis solutions track activity, identify usage patterns and segment and profile customers by demographic groups and interests. Armed with this knowledge, an e-business can tailor marketing and merchandising promotions to specific customer subsets and then measure the effectiveness of these banner ads or e-mail marketing initiatives in terms of audience draw and response rates.


I/PRO, Redwood City, CA - a company specializing in Web traffic measurement, verification and analysis - has a range of services. These services include NetLine for Sites, which gauges a Web site's audience size, profile and behavior; NetLine for Enterprises, which reports on discrete business segments of your enterprise Web site; and NetLine for Networks, which is designed for a network of Web sites requiring multiple account reporting.


Macromedia Inc, San Francisco, which acquired Andromedia at the end of 1999, also has graduated Web traffic measurement and analysis tools for Internet businesses of differing size and complexity. ARIA, its solution for single hosts, records and reports on customer behavior in real-time and provides drilldown capabilities for evaluating daily, weekly or monthly traffic trends. ARIA for Enterprises can crunch data across multiple servers and provide one consistent view of customer activity to aid marketing, sales and merchandising strategies.


Fremont, CA-based Accrue Software Inc.'s Accrue Insight is a scalable Web tracking and analysis application that offers a unified view of customers by integrating Web-based visitor information such as (resets, stopped downloads and visit duration, with demographics, transactions and other enterprise data. The application analyzes this data to provide insights into how visitors navigate through a site, which search engines and portals refer the most qualified prospects, what content appeals to which customer segments and customer preferences and habits.


Getting Personal


Smart shop owners keep mental dossiers on their best clients and automatically steer them to the merchandise that complements their lifestyles, tastes and budgets. Harnessing technology to approximate these one-on-one exchanges is at the heart of the CRM model.


In the race to acquire and retain customers, Internet companies of all size and description seek ways to add that personal touch. In response, the Web has spawned a new generation of customer profiling and personalization technologies.


Real-time recommendation engines learn about an individual's preferences by analyzing customer preference and behavioral data. This information often is augmented with results from customer surveys and responses to special promotions and offers. Based on this emerging profile, the engines identify a community of like-minded individuals who share similar tastes and interests. Using the community's historical preferences and online activities as a predicator, the recommendation engine makes personalized recommendations to the individual, and refines its targeting criteria with each customer interaction.


One example is Palo Alto, CA-based ClickAction's E-mail Relationship Management technology. This outbound, permissions-based e-mail campaign management solution targets offers for individual customers. Personalization and targeting tools make ERM a "marketers" solution for building true one-to-one, personalized relationships over e-mail. Additionally, the ClickAction ERM permission profile easily integrates with enterprise legacy data, rule-based permission targeting techniques, data analysis and modeling tools.


MessageMedia, Boulder, CO, another leading provider of e-messaging solutions, builds customer relationships online. MessageMedia's UnityMail provides a complete solution for targeted, personalized, and accountable e-mail list management and Internet permission marketing. In addition to standard e-mail list server functions, UnityMail can perform unique functions such as targeted e-mail (filtering and data segmentation), personalized e-mail, dynamic content editing, trackable URLs and campaign sequencing.


Macromedia's LikeMinds personalization software builds a unique affinity group around each Web visitor in real time to generate recommendations that will appeal to an individual customer. Built for dynamic e-commerce environments, LikeMinds constantly upgrades its knowledge bank by factoring in new customer visits, customers' evolving tastes and changes in a site's merchandise and service offerings.


High-performance Internet traffic analysis and customer profiling solutions are enabling Web marketers to view their customers as individuals and tailor programs and offerings to suit their likes and dislikes. The benefits in terms of improved ROI, more informed decision-making and greater customer satisfaction and retention are immeasurable.
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